Property Transfer Tax and Mortgage Fees Reduced (but unlikely to be enough)

Excludes Condominiums of higher value than THB 3,000,000

The expected reduction in the property transfer tax to 0.01% from 2.0% and mortgage registration to 0.01% from 1.0% were approved by the Thai government on 11th January and will become effective once passed in the Royal Gazette (and will then be effective until 31st December 2021). The bad news is that these discounts aren’t applicable to condominiums of higher value than THB 3,000,000 which is most of the property market in downtown Bangkok, and what weighs the most in the property sector on the banks’ balance sheets.

This same discount on the tax and fee was previously implemented in May 2019 and expired in May 2020. Since then the property market has slumped further although property prices have yet to drop significantly in Bangkok or enough to attract bargain hunters. The latest announcement might help to spur buyers of land with buildings, townhouses, or single, detached or commercial buildings outside of the downtown Bangkok area where prices are relatively more stable, however, in our view it would have been better to include condominiums of all values as was the case prior to 2019 as this did notably improve property sales.

Our law team specializes in property transfers, queuing at the Land Department on your behalf to buy/sell a property under a proxy agreement between you and our lawyer. We can also estimate the capital gains tax due, and suggest the best payment option to settle this cost effectively.

Land & Property Tax – this new tax continues to be discounted

Last week, the Thai cabinet announced a 90% reduction in the land & property tax which was is meant to be paid by April 01st for each calendar year. The tax for residential is 0.3% or now becomes 0.03% while for commercial buildings which is 1.2% that now becomes 0.12%. There is no tax applicable on the primary residence if it’s worth less than THB 10,000,000 and this tax catches people who have a house registration book but who own property which isn’t registered in this book. (i.e. property that the owner does not live in). If a foreigner has never registered their name in any house registration then it’s possible that they may not receive a notification from the district office even if they own more than one property. But this situation may not last for long.

There are benefits for a foreigner having your occupancy registered in a house registration book which can include obtaining a residency ID card (you can request) which is a more convenient means of carrying an ID with you than is a bulky passport.

MBMG can assist with obtaining a house registration book for you at a reasonable price.

Please send your request for more details to: info@mbmg-group.com | Tel: +66 02 665 2534 to 9