What are the taxes and utility payments for property owners in Thailand?

Taxes for property owners in Thailand

Property owners in Thailand face the necessity of fulfilling certain tax obligations, as well as considering expenses for utilities and insurance for their properties. It is also important to take into account the nuances related to renting and selling real estate.

Property ownership tax

All property owners, regardless of whether they are citizens of Thailand or foreigners, are required to pay annual taxes on property ownership and rental. Special attention should be paid to the land and building tax, which was introduced on January 1, 2020. This tax does not differentiate between types of property and is calculated based on the market value of the property and its intended use.

Tax benefits for owners

There are certain tax benefits for specific categories of owners:

• Villas:Owners of villas priced up to 50 million baht (approximately 1.3 million dollars) are exempt from paying taxes.
• Apartments:Apartment owners whose properties are valued at no more than 10 million baht (approximately $271,300) can also avoid paying taxes if they are registered as permanent residents.

Tax rates for 2024

The tax rates for this year have been determined as follows:

• For land used in agriculture - 0.01%.
• For residential real estate — from 0.02% to 0.1%.
• For objects with a different purpose — from 0.3% to 0.7%.
• Vacant propertiesThey are also taxed at rates ranging from 0.3% to 0.7%.

Tax obligations are determined as of January 1st of each year and must be paid by April. Failure to meet this obligation can result in severe penalties of up to 40% of the unpaid amount.

Rental income

When receiving income from rental properties in Thailand, it is important to consider local tax regulations. The country's tax system is quite complex, so it is highly recommended to seek the services of local brokers for advice on optimizing tax obligations.

Personal income tax

For people spending more than 180 days a year in Thailand, income tax is calculated on a progressive scale:

• Up to 150,000 baht — 0%.
• From 150,000 to 300,000 baht — 5%.
• From 300,000 to 500,000 baht — 10%.
• Incomes over 5 million baht are taxed at 35%.

Taxes for non-residents

Non-residents typically face a fixed tax rate of 15% on income earned in most cases. Considering the variety of regulations, it is important to understand that taxation can vary depending on the type of visa and other circumstances.

Taxes for companies

As for companies, they must also pay income tax on rental income, which is determined by a progressive scale. For legal entities, there is a tax rate of 0% on profits up to 300,000 baht. Therefore, businesses need to closely monitor changes in tax legislation to avoid potential issues with tax authorities.

Conclusion

Thus, it is important to understand that the tax system for property owners in Thailand is characterized by many features and nuances. Taxes, utility expenses, and insurance all represent a comprehensive approach to doing business in this country. With proper planning and consultations, it is possible to significantly optimize financial costs and reduce the risk of unexpected situations.

Taxes on rental property in Thailand

In Thailand, rental housing and associated taxes are of significant importance to property owners. If you earn income from renting, you may be eligible for various tax benefits depending on the amount of income you receive.

For example, if your rental income ranges from 8,100 to 3 million baht, the tax amount will be 15%. However, if your income exceeds 3 million baht, the tax rate increases to 20%. This is important to consider because landlords can receive a standard tax deduction of30%from the total rental income.

In addition, there is the possibility of obtaining a deduction for actual expenses if you have the appropriate supporting documents. Be sure to keep in mind that the tax return must be submitted to the local tax authority or filed online through the official tax service website.

Value Added Tax (VAT)

In addition, property owners in Thailand may face another tax obligation known as value-added tax (VAT). This tax applies to both individuals and legal entities that regularly offer goods or services, provided that their annual income exceeds1.8 million baht.

The standard VAT rate is10%However, a temporary reduction was established by the government until7%Until September 2024. Tax reports must be submitted by the 15th of each month, based on data from the previous period.

Utility payments

As for utility services, their cost depends on:

• Type of real estate;
• Her location;
• Areas;
• Provided services.

The more amenities and conveniences a residential complex offers, the higher the utility bills will be for the owner. Standard services may include:

• Round-the-clock security;
• Cleaning of common areas;
• Pool and landscaping maintenance;
• Elevator and garbage disposal.

On average, the cost of services from a management company ranges from0.6 to 3 US dollarsper square meter per month.

Electric power supply

In Thailand, all utilities, including electricity, are under government control, and electricity is supplied by two main operators:

• Metropolitan Electricity Authority (MEA), which serves Bangkok;
• Provincial Electricity Authority (PEA), which provides electricity to other regions.

Payments for electricity are made based on the meter readings, and the electricity tariff starts from0.06 dollarsper kilowatt-hour. Usually, the monthly electricity expenses amount to100 to 200 dollarsespecially if you actively use air conditioners, which is common in hot climates. Fair use of electricity can reduce monthly expenses by30-60 dollarsfor an apartment with an area of 50 square meters.

Water supply

In the water supply sector in the country, there are also two main companies: the Metropolitan Waterworks Authority (MWA), which provides services in Bangkok and its surroundings. Each of these services requires careful attention and an understanding of your rights and responsibilities as a property owner in Thailand.

Water supply management in Thailand

In Thailand, water supply management is handled by the Provincial Waterworks Authority (PWA), which has offices in every region of the country. The water that enters residential buildings is heated through electric boilers, while the water that exits the system is supplied in a cold state. The electricity bill is issued at the beginning of each month and is based on actual usage from the previous period. It must be paid within the first two weeks after receipt; otherwise, significant penalties may be imposed.

Measurement and cost of water

The unit of measurement for water in Thailand is the cubic meter, which is referred to as a "unit" here. The average price of one unit is about$1Typically, the costs of water supply for citizens range from100 to 200 baht ($2-6)per month. Often, when moving into a residential complex, a deposit is required for several months in advance, after which the manager provides a report on the expenses. Utility bills for water and electricity can also be paid at most large supermarkets.

Gas supply

As for gas supply, stove owners in Thailand are forced to use gas cylinders since there is no centralized gas supply system in the country. When purchasing for the first time, a deposit for renting the container must be paid along with the cost of the gas. The deposit is about1500 baht ($40)...and the price of gas cylinders ranges from...300 to 500 baht ($8-14)If you need to replace an empty cylinder, just call the store, and a new cylinder will be delivered while the old one is picked up for refilling.

Telecommunication services

Speaking of telecommunications services, foreigners in Thailand hardly use landline phones. The leading mobile network operators in the country are:

• AIS
• DTAC
• TrueMove
• TOT

SIM cards can be purchased both at the offices of these operators and in regular supermarkets. The cost of local calls starts from1 baht ($0.03).

Internet and television

Mobile internet users can choose packages that cost around$15-20per month. For stationary internet in an apartment, the price usually starts from$20 to $30monthly, with prepayment, often for a year, which can be made at the provider's office or at the reception. The most well-known satellite TV provider in the country is True Visions, with services starting from$10per month. Payment can be made either directly to the supplier or through the manager, and in some residential complexes, television may already be included in the overall service fee.

Real estate insurance

It is important to note that in Thailand, there is no mandatory property insurance for foreigners. Property owners can choose to take out an insurance policy if they wish. Before contacting an insurance company, it is advisable to find out whether such expenses are included in the annual budget for maintaining the property, as in some complexes this service may already be included. The average cost of an insurance policy is about400 baht ($11-12)per month, which will amount to approximately in a year4,600 baht ($125).

Real estate in Thailand

Currently, real estate in Thailand offers a wide range of interesting options, one of which is an apartment in Phuket for €81,320, with an area of 34 m². We organize online presentations and provide the opportunity to conduct transactions remotely. You can make payments in both rubles and using cryptocurrency. This property is great for rental, and the launch of sales for a large residential complex is scheduled for May 2024. My name is Leon, and I will be happy to answer your questions. Be sure to inquire about current prices and availability at the time of your request!

Unique projects in Phuket

Phuket features over 30 exclusive residential projects. If you're interested in current offers, feel free to contact us! Among them stands out a luxurious condominium with a well-developed infrastructure, located in the resort area of Bang Tao. This property is part of a wide range of real estate available in the Thai market.

Apartments in Pattaya

Additionally, in Pattaya, there is an opportunity to purchase an apartment for €55,200, with a total area of 36 m². Online presentations and remote purchasing options are also available, with payment in rubles or cryptocurrency.The Orient Jomtienproud of its unique blend of Eastern charm and modern technology. Elegant green gardens and the smooth contours of the pool harmoniously fit into the original architecture of the building, adding sophistication to it.

Comfortable apartments in Phuket

Apartments in Phuket with full finishing can be a great option for comfortable living. For example, an apartment costs €91,956 and has an area of 52 m².Vega CondominiumIt stands out with its unique combination of modern design and luxury, making it the perfect place to live. The architectural solutions of the project symbolize majestic sea waves and the pursuit of natural harmony.

Investment options in real estate

If you are considering options for investment, take a look at a two-story townhouse in Pattaya, priced at €173,900, with an area of 151 m².Villa La Richie— this is a modern building that includes 8 residential units, each with access to a pool and a spacious terrace. This project was designed as a hotel complex, making it attractive to renters.

Apartments in the Pratumnak area

In addition, in Pattaya, you can buy an apartment for €43,745 with an area of 25 m². It is located in a prestigious area.Pratamnokknown for its greenery, where the residence of the Thai princess was built. Surrounding it are:

• golf courses,
• elite restaurants with breathtaking views,
• night markets,
• clean beaches.

These factors create a cozy atmosphere for living.

Apartments near international schools

It is also worth noting the apartment in Phuket priced at €57,988 and covering an area of 29 m². It is located in close proximity to three international schools. For example, the school...Kajonkiet ThalangIt is located 300 meters from the property, making this accommodation an ideal choice for families with children.

Choosing real estate in Thailand

Thus, the choice of real estate in sunny Thailand is diverse, and everyone can find the optimal option, whether for living, vacationing, or investing. Feel free to contact us for clarification on all the details and current market prices!

Speaking of the international educational organization Headstart, it is worth noting that it is just six minutes away from the popular Hei Schools network, which is located a five-minute drive away in Phuket. This indicates the strategically convenient location of the condominium, providing access to educational institutions and various infrastructure.

The Robinson Talang shopping center is located nearby, as well as the large wholesale market Macro, where you can find some of the best prices currently available in Phuket.

Luxurious villa in Samui

This complex also features a luxurious villa in Samui, with an area of 180 square meters. The villa includes three bedrooms and three bathrooms, making it a great investment opportunity. The price of this property is400,356 euroswhich makes it suitable for both permanent living and renting.

• The expected rental income exceeds7%.
• The option to pay in installments makes the offer even more attractive.
• The villa is located on a green hillside.
• A panoramic view of the surrounding seas and valleys.

Sunrise Hotel

The Sunrise Hotel offers magnificent opportunities for guests, combining stunning sea views with proximity to picturesque, untouched beaches. If you are considering investing in real estate in Thailand, DDA Real Estate presents a variety of offers from Pattaya, starting at prices from72,700 eurosfor an apartment with an area of 44 square meters with three rooms.

Moreover, we confirm the possibility of conducting remote transactions; payment can be made in rubles or cryptocurrency.

Alza Real Estate & Development

Alza Real Estate & Development offers a unique experience when purchasing real estate in Thailand, providing you with the best deals on the Pattaya market. For example, the Oasis residential complex includes three modern buildings that beautifully blend into the region's tropical landscape.

• You can choose from a variety of options, starting with small studios that are just26 square meters.
• And ending with spacious apartments.
• Each listing includes an option for an online viewing.

Investments and lifestyle

For those looking for attractive options and profitable investment opportunities, Oasis stands out among other properties in Pattaya, offering not just housing but a unique lifestyle surrounded by nature. Consider investing here and enjoy life in one of the most picturesque places in the world, where every moment will feel like a vacation.

Don't miss the chance to be part of this exceptional project and enjoy the most comfortable living and relaxation conditions!

At Alza Real Estate & Development, you can find the best options for real estate investments in Pattaya, Thailand. For example, you might consider a 35 square meter apartment priced at €49,900. This offer includes online viewings and the ability to complete transactions remotely, with payment options in rubles or even cryptocurrency.

Buying property on the island of Phuket

On the magnificent island of Phuket, located in the heart of Thailand, there are many wonderful living conditions. You can enjoy an abundance of amenities, including lush swimming pools, children's playgrounds, and a gym equipped with boxing gear. The complex also features comfortable coworking spaces and designated work areas, making it an unparalleled place for both relaxation and productive work.

DDA Real Estate Project

The DDA Real Estate project offers unique apartments with an area of 32 square meters at a price83,680 €This makes the purchase accessible to a wide range of interested buyers. The ability to complete the transaction remotely simplifies the process, and payment can be made in both rubles and cryptocurrency. This property is also ideal for renting out, and the pre-sale of the third phase of the Ozone Signature condominium is currently underway.

• Discounts for early buyers:200,000 baht.
• As a gift — a complete set of furniture.

Convenient location of the complex

The complex is conveniently located between the shopping avenue Boat Avenue and the magnificent golf courses of Laguna Phuket. Notably, the famous Bang Tao Beach is just a five-minute drive away, making it even more appealing. Building A of this complex features 118 modern apartments designed for comfort and coziness.

Stunning villas from Azure Home Co Ltd

Azure Home Co Ltd offers its clients luxurious villas with prices starting from470,000 €for a villa with an area of 270 m2. The villas have four bedrooms and three bathrooms and are located just three hundred meters from the coastline, surrounded by lush tropical gardens and pools. This magnificent place to live combines tranquility with developed infrastructure and is close to the airport and major attractions of Phuket.

Villas in Amrits Luxury Villas

The Amrits Luxury Villas sect offers33 stunning villasthat will undoubtedly impress with their design and features.

Collection of villas on Bang Tao Beach

In addition, there is a collection of thirteen magnificent villas on Bang Tao Beach available starting from879,919 €Each villa boasts impressive dimensions (481 m2) and includes five bedrooms and five bathrooms. They are designed with a focus on eco-friendliness, privacy, and luxury, making them truly unique. The modern villas with private pools feature a carefully thought-out design that ensures a high level of comfort.

Real estate rental in Phuket

If you are planning to rent out your property in Phuket, there are several options worth considering. Foreign owners can choose from three main approaches.

Self-rental

The first option is self-rental. In this case, you will have to organize everything on your own:

• Prepare the accommodation.
• Finding tenants.
• Address all arising issues.

This approach will require significant time resources and a deep understanding of the market, but it has the potential to generate high income. It is important to note that according to Thai law, properties without a tourist license cannot be rented out for short-term stays. Licenses are primarily granted to complexes that have hotel infrastructure, but unfortunately, not all projects have such certification to allow for short-term rentals.

Real estate agency services

The second option is to use the services of a real estate agency. In this case, you can sign a contract with a professional company that will handle all aspects related to renting out your property. This way, you'll have the opportunity to focus on other important matters without worrying about the day-to-day tasks.

Real estate management

Professional realtors can take care of all the concerns related to managing your property and ensuring its rental. They will handle finding tenants, advertising your property, collecting rent, preparing the apartment for leasing, meeting tenants upon their arrival, and overseeing the eviction process.

Moreover, the specialists will ensure that cleaning, tax payments, and utility bills are taken care of on time, which will significantly ease your life. You also have the option to coordinate with the agency the dates of your vacation and the times when the apartment is available for rent.

The real estate market in Thailand

Many companies are actively working in the real estate market in Thailand, covering various regions of the country. You can learn about them through specialized platforms that provide information about their services. In particular, it is worth paying attention to apartments in popular residential complexes in Phuket, where there is a demand for options with one or two bedrooms.

Management companies in this region offer rental services and oversee the condition of the properties. Some residential complexes have hotel management, such as Wyndham and Hilton, which adds extra reliability for tenants.

Rental programs

Property ownersThey can consider the possibility of participating in rental programs that offer guaranteed income. Typically, such offers provide a return of around 5-8% per year, and in some cases, this figure can reach 20% net income per year.

Therefore, when choosing an apartment, it is important to decide in advance on the complexes that offer such services.

Acquisition of real estate in Phuket

If you are considering an optionreal estate purchasesIf you are in Phuket, you should familiarize yourself with the current information and recommendations. For example, it is important to consider that the management company is primarily responsible for managing the properties, and this aspect plays a significant role when choosing accommodation.

Sales process

The process of selling real estate in Thailand involves several important stages that need to be taken into account:

• First of all, the owner should decide how he intends to sell his property.
• It is possible to do this independently, which includes active advertising: placing ads on various platforms, collaborating with agencies, and organizing showings.
• You can also use the services of an agency, in which case you need to inform the management company about the planned sale, as potential buyers often contact them directly.

Features of transactions

Every transaction for the sale of secondary housing has its own unique nuances, which can depend on a variety of factors:

• Legal status of the object.
• Seller's status and financial situation.
• The availability of installment payment options.

It is important to ensure proper legal support for the transaction; the cost of professional legal services can range from 700 to 1000 dollars.

Taxes on sales

The taxes that need to be paid upon sale also depend on various conditions:

• Object status.
• Legal status of the owner.
• The period of ownership of the apartment and the appraised value of the property determined by the land department.

When conducting transactions, both parties—buyers and sellers—must pay a registration fee, which is 2-3% of the property's value. This is a mandatory requirement for formalizing the transfer of ownership rights.

Registration of a long-term lease agreement

The registration of a long-term lease agreement, also known as leasehold, requires the payment of a registration fee, which is 1% of the total amount specified in the agreement. In addition, business owners and individuals who have owned their property for less than five years are required to pay a special business tax (SBT). The rate of this tax is 3.3% of the higher value between the sale price and the cadastral value of the property.

Taxes on real estate sales

When the ownership period of real estate exceeds five years, the seller must pay the stamp duty, while the SBT tax is no longer applicable. The stamp duty rate is set at 0.5% of the sale price or the cadastral value, depending on which of these amounts is higher. Registering a long-term lease also requires the payment of stamp duty, which is 0.1% of the amount specified in the lease document.

Withheld tax

It should be noted that when selling real estate, the seller must pay the withheld tax. If the seller is a legal entity, the tax rate will be 1% of the contract amount or the established value of the property, whichever is higher. If the seller is an individual, the income tax will be calculated on a progressive scale, deducting the standard deduction, which is determined by the period of ownership.

Income tax rates

In Thailand, income tax is calculated at the following rates:

• up to 300,000 baht – 5%
• from 300 to 500 thousand – 10%
• from 500 to 750 thousand – 15%
• from 750 thousand to 1 million – 20%
• from 1 to 2 million – 25%
• from 2 to 5 million – 30%
• over 5 million – 35%

The amount of the standard deduction depends on the period of ownership: 92% for 1 year, 84% for 2 years, 77% for 3 years, and so on, down to 50% for 8 years and more.

Example of calculating sales tax

To better understand how the tax is calculated upon sale, let's consider the following example. Imagine that the seller has owned the condominium for less than two years, and its official appraisal is 3 million baht. First, it is prudent to deduct the standard exemption:

3,000,000 – 3,000,000 × 84% = 480,000 baht. After that, we will divide the amount by the number of years of ownership:

480,000 / 2 = 240,000 baht. Now let's apply a 5% tax rate to this amount:

240,000 × 5% = 12,000 baht. When we multiply this amount by the duration of ownership, we get:

12,000 × 2 = 24,000 baht — this is the amount the seller will have to pay. However, it is important to remember that this tax cannot exceed 20% of the transaction value.

Main findings

So, the main conclusion is that property owners in Thailand are required to pay annual taxes on ownership, rental, and sale of their properties. The amounts depend on various factors, so it is important to consult with professional accountants and brokers to optimize tax obligations. Additionally, residential complexes in Thailand have maintenance fees that range from $0.6 to $3 per square meter per month. The level of services provided in these complexes directly affects the amount of these fees. Utility payments are also calculated based on meter readings, which should also be taken into account when budgeting.

Conclusion

In conclusion, I would like to summarize and emphasize that understanding taxes, utility payments, and other financial obligations is a key aspect for property owners in Thailand. Throughout the article, we examined important aspects, including taxation principles, from land and building taxes to rental income tax, as well as the nuances related to utility services.

It's important to remember thattax ratesandbenefitsThey depend on various factors, such as the cost of the property and the owner's status, as well as the intended use of the real estate. Tax exemptions for certain categories of property owners serve as an incentive for investing in this sector, provided that all legal norms and requirements are met.

Utility payments

In terms of utility payments, they can vary depending on the type of property, its location, and the services provided. Definitely, manage your expenses wisely to avoid unexpected financial burdens. Optimizing utility payments and being mindful of energy consumption can also significantly reduce your monthly costs.

Recommendations

We also recommend consulting local specialists and brokers who can help you understand all the nuances of taxation and property maintenance costs. Considering all the factors mentioned above, a property owner who is informed about their rights and obligations will be able not only to preserve but also to increase their investments, making their living space in this beautiful country even more comfortable and profitable.

Final thoughts

In summary, it is important to note that proper management of one's own property in Thailand requires attentiveness and responsibility, but in turn, it opens up numerous opportunities for owners to realize their ambitious plans. This is the foundation of successful real estate investment in a country with a rich culture and amazing possibilities.