Purchasing Real Estate in Thailand: Description of Transaction Fees and Responsibility for Payment.

As with any real estate market, buying property in Thailand will incur additional costs and fees. Before buying real estate, you may encounter transfer fees, business taxes, and state survey fees, but what are they? And who is responsible for paying them? Here's what you need to know.

Transfer duty. The Thai Land Department levies a fee of 2% of the assessed value of the property.

Business Tax. This tax is 3.3% of the assessed value and is only imposed if the property is sold within the first five years of ownership. If it does not, a state fee will be charged instead.

The state fee. A tax of 0.5% of the registered value will be levied. If business tax applies, no state tax is required.

>Tax withholding. It depends on whether the seller is a company or an individual.

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The withholding tax for the company is 1% of the appraised value or 1% of the sale price, whichever is higher. On the other hand, if the seller of the property is an individual, tax withholding is calculated at progressive rates based on the assessed value.

Who pays for transfer fees and taxes?

In most cases, developers split all costs 50/50 with buyers. However, in private transactions, the seller often incurs most of the costs, which include business tax, state tax and withholding tax. On the other hand, buyers are expected to pay 1% of the 2% transfer fee in general. However, this is very case dependent and subject to negotiation. It is common to agree in advance on how much of these taxes and duties will be paid by the sellers or buyers. It's also worth talking to a real estate agent or lawyer beforehand. Keep in mind that fees are different when registering a rental and buying a property from a developer.