Costs, Taxes and Government Fees When Buying Property in Thailand
Property Acquisitions via Company Takeover
If a property transaction occurs by taking over a company (this could be a Thai company or an offshore company), then the owner of the property in question remains the same company. No transfer of property ownership has occurred, and no real estate transfer taxes or fees are payable. Instead, the transaction involves a share transfer.
In the case of a Thai company, the government imposes a 0.1% stamp duty on the value of the shares.
In the case of a foreign company, no taxable event has occurred in Thailand, and there is no Thai tax liability.
Property Acquisitions by Setting up a New Company
When a property is acquired without taking over an existing company, there is a transfer of ownership and a real estate transaction is deemed to have occurred. In this case, government taxes and fees are payable, potentially adding up to around 6% of the contract price.
The taxes and fees vary depending on whether the ownership is leasehold or freehold.
Leasehold Ownership
When acquiring a lease of land or building, both stamp duty and a lease registration fee are payable. These are based on the total rental value across the lease term.
- Stamp duty: 0.1%
- Lease registration fee: 1%
In Thailand, the seller normally pays the stamp duty. The lease registration fee is typically split 50:50 between both parties.
Summary of Leasehold Transfers:
| Tax/Fee | Rate | Party Liable |
|---|---|---|
| Stamp duty | 0.1% | Seller |
| Lease registration fee | 1% | Buyer and seller share 50:50 |
Freehold Ownership
For freehold transactions (e.g. land or a freehold condominium), the following fees and taxes apply:
- Transfer registration fee: 2% of the land office appraised value.
- Withholding tax: 1% if the seller is a company (calculated on the higher of appraised value or purchase price).
- Specific Business Tax (SBT) or Stamp Duty:
- SBT applies if the property is registered in a company’s name or held in a personal name for less than 5 years.
- If SBT does not apply, stamp duty of 0.5% applies instead.
Theoretically, the transfer fee is split 50:50, and the seller is liable for withholding tax and either SBT or stamp duty. However, in practice, many deals are negotiated with all taxes and fees shared equally between buyer and seller.
Summary of Freehold Transfers:
| Tax/Fee | Rate | Party Liable |
|---|---|---|
| Transfer registration fee | 2% | Buyer and seller share 50:50 |
| Withholding tax | 1% | Seller |
| Specific Business Tax | 3.3% | Seller |
| Stamp duty | 0.5% | Seller |
Declared Value and Future Capital Gains
In Thailand, the declared value of a property — the figure recorded at the Land Office — is often lower than the actual sale price. This declared value is used to calculate both transfer fees and, later, the capital gain if the property is resold.
While declaring a lower value can reduce upfront taxes and fees, it also increases the apparent profit on resale. This can lead to higher capital gains tax in the future, particularly if the full market value is declared when the property is sold.
Buyers should seek legal advice before deciding how to declare the purchase price.
Compliance Note
Where a company is being set up to acquire the property, buyers must ensure that the structure is fully compliant. In particular, Thai shareholders must not be nominees — they should have a genuine interest in the business, and the company must be established as a profit-making enterprise, not solely as a holding vehicle for the property. Given the current environment of strict enforcement, proper legal guidance is essential. Read more about ownership structures for buying property in Thailand.
