Building Tax and Property Tax in Thailand

The introduction of legislation of Building Tax and property tax in Thailand in 2020 has brought about changes for all property owners, in Phuket and nationwide. The primary objectives of this legislation were to address income inequality issues effectively increase tax earnings and improve the efficiency of property tax collection procedures.

Some of the revisions brought about by this legislation consist of;

The traditional way of computing property tax using the evaluated value established locally has been substituted with an approach based on the value of both structures and land determined by the treasury department resulting in a more dependable and transparent process.

Residential properties that used to be exempt, from property taxes are now required to pay taxes well This change has led to a considerable rise, in the amount of revenue collected from property taxes

Variable Tax Rates Update;, than a fixed rate of 12 50% a sliding scale is now in place adjusting based on the property’s usage to ensure taxes align, with its intended purpose and worth.

Responsibility, for property tax collection falls on the district administration of each jurisdiction known as tambon.

Property Assessment Values; The values used to assess property, for tax purposes are in sync, with those utilized for land transfer fees and taxes recorded at the nearby land registry office.This information gets revised periodically to mirror the market values as assessed by the finance department as detailed in the Property Appraisal Act (2019). It is anticipated this modification will lead to property assessment values aligned with present market conditions.

Taxation regulations, in Thailand regarding property construction and development.

The Land and Building Tax in Thailand is applicable to a range of properties such as land parcels and buildings along with condominium units; however certain exemptions exist for property types as, per the laws provisions. Below are some aspects to note about properties and exemptions governed by the law;

1. Taxable Assets Include Land and Buildings as Condominium Units subject, to taxes based upon their assessed value.
2. Certain properties are not liable, for the Land and Building Tax as per exemptions outlined in the regulations – these include properties owned by the entities or utilized by foreign governments, like embassies and consulates and those serving religious purposes among others.
3. Residential Property Tax Benefits, for Homeowners ; Homeowners can take advantage of tax benefits based o n their property’s value. The exemptions include the following ;
   a. Individuals who own both the land and buildings do not have to pay taxes for properties valued at, than 50 million baht.
   b. Residential properties worth, than 10 million baht are not subject to taxation for people who own the building and not the land, such, as condominium owners.
4. Tax Exemption, for Primary Residence Clarification; Please keep in mind that the tax exemption for properties only pertains to the residence of the owner, not any other properties they may own or use as second homes, which are subject, to taxation based upon their assessed value.

Please consider seeking advice, from a tax expert or the appropriate authorities to make sure you grasp and follow the Land and Building Tax laws correctly including any exemptions that may apply.

In Thailand’s Land and Building Tax system tax rates vary depending on how the property’s used. These rates fall into four categories, each, with its maximum rate as of 2020;

• Properties dedicated to agriculture, known as properties are classified in this group. Are subjected to a tax rate of 0…15 percent based on their assessed value.
• Residential properties refer to properties utilized for living purposes such, as condominiums (condos) apartments and houses. Are recognized as properties, in the tax system where a tax rate of 0․30 percent is applied to the property’s assessed value.
• Non residential or non agricultural properties refer to those used for industrial purposes of residential or farming activities. The tax rate applicable, to properties is set at 1/20th of the property’s assessed value.
• Unoccupied Buildings; Properties that are empty or not being used for any purpose are considered properties, in this context.The starting tax rate, for properties is set at 1 2%. Moreover the tax rate goes up incrementally every three years with a rise of 0 5% capping at the rate of 1%.

Please bear in mind these rates represent the rates and the specific tax amount could vary depending upon the assessed value of the property as determined by the treasury department in accordance, with the Property Appraisal Act.

It’s wise to seek advice, from a tax expert or refer to the guidelines and regulations issued by the authorities in Thailand for precise and current details, on tax rates and possible changes.

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