Selling Property

Selling property.

For selling a property a title search must be performed to prove ownership of the property and all documents must be legalized officially.

Once all the terms have been agreed between the buyer and seller it is then time to make the sales agreement which must be signed by both parties. There is no legal requirement for this document to be notarized, but any and all copies must be signed stating that they are true copies of the original document. This is also the stage at which a deposit is paid by the buyer. Should the buyer not pay the balance within a agreed period of time then the deposit is not refundable (usually 30 days). The transfer tax can be paid by the buyer, seller or both parties, this need to be agreed in the sales contract.

When the sale closes then both the buyer and seller will need to be in attendance to sign the final documents. In Thailand this can be done with the selling agent or with a lawyer. The land registry office will also need to see both parties. If the property has been bought through a company then a lawyer will have to be appointed to help with the sale due to the amount of legal paperwork that will need to be dealt with.

The Thai law also states that several pieces of documentation will be required. Depending on the circumstances surrounding the sale they can include some or all of the following, Title deeds, proof of identification such as a passport, a marriage or divorce certificate if this is relevant, property tax documents, the house registration documents, the purchase agreement and the power of attorney form if this is relevant. For the sale of condos there are other forms that will also be required including a foreign exchange transfer form that is available from the bank, a document stating that there is less than 49% foreign ownership in the condo building and a document stating that there are no outstanding maintenance fees for common ground applicable to the property. If there is still a mortgage owing on the property then the mortgage lender or bank will also have to be involved in the selling process as they will have the title deeds for the property.

Capital gains tax will apply on the sale of the house. This can vary due to length of ownership of the property, so those who have lived in their houses longer will pay a smaller percentage of tax. The tax laws in Thailand are standard regardless of whether the property was bought or was inherited or was gifted to the owner.

Selling Taxes:
The taxes when selling a property are the same as when buying, except there is also a withholding tax. This tax ranges form from 0 to37%. The tax rate varies based on the income of the seller as follows:
1. 0 to 80,000 THB: 0%
2. 80,001 to 100,000: 5%
3. 100,001 to 500,000: 10%
4. 500,001 to 1,000,000: 20%
5. 1,000,001 to 4,000,000: 30%
6. 4,000,001 and above: 37%

The basis of the tax is the government appraised value less a deduction of between 50% and 92%, depending on how long you own the condo. The longer you own the condo, the lower the deduction from the appraised value, and therefore your withholding tax liability is higher. Specific withholding rates are as follows:
1. 92% if you have held the property for one year,
2. 84% for two years,
3. 77% for three years,
4. 71% for four years,
5. 65% for five years,
6. 60% for six years,
7. 55% for seven years,
8. 50% for eight years or more.
As with buying property, the following taxes apply for purchases of property:
Transfer Fee of2% ( 0.01% until April 2009) of land assessed value.
Business Tax of 3.3% (0.11% until April 2009) of the sales price or the assessed value, whichever is higher, must be paid in cases that a seller has a property in his possession for less than 5 years.
Stamp Duty of 0.5% of the appraised price must be paid only when a specific business tax is not applicable.

Sellers:
The decision to sell a home is often dependent on many factors. Whatever your reasons are for selling, my proven effective marketing strategies will ensure that you get the highest possible price for your home. I guarantee to provide you with professional, ethical and confidential service and keep you fully informed every step of the way.

At ATS we will guide and assist you with all the procedures regarding a property sale.