I had a look through some of the recently posted messages and replies but simply don't understand the personal income tax calculation.Is it calculated progressively? I have owned my condo for 8 years and am considering selling it for THB 6,5 mio. I understand the transfer fee of 2%, the stamp duty of 0,5%, no need for the specific business tax having owned my condo for 8 years - right - but am not sure about the personal income tax I will expect to pay. Appreciate any help you can extend and best regards, D
In a normal sale (where a private individual, foreign or Thai, sells his condo) the withholding income tax shall be calculated at a progressive rate with a deduction depending on the number of years of possession.
For companies withholding income tax payable at the time of transfer is fixed at 1 % over the registered sale price or government assessed value of the property, whichever is higher.
Sample calculation for an individual person selling his condo:
The sale price (equal to government assessed value) is 800,000 baht, the period of ownership is 2 years and 5 months (= for tax calculation this will count as 3 years). There is a deduction based on the years of ownership as follows:
1 years = 92%
2 years = 84%
3 years = 77%
4 years = 71%
5 years = 65 %
6 years = 60%
7 years = 55%
8 years or more = 50%
In this case the deduction is based on 3 tax years of ownership = 77% x 800,000 baht = 616,000 baht. The personal income withholding tax base is 800,000 baht less 616,000 baht = 184,000 baht, divided by 3 (the number of years of ownership) = 61,300 baht as the amount to calculate the yearly personal income tax.
The income tax rates in Thailand are:
Less than 100,000 baht = 5%
Between 100,000 and 500,000 baht = 10%
Between 500,000 and 1,000,000 baht = 20%
Between 1,000,000 and 4,000,000 baht = 30%
More than 4,000,000 = 37%
New Income Tax rates
Income between 0 to 150,000 baht is exempt
Income between 150,000 to 300,00 has a tax new tax rate of 5%
Income between 300,000 to 500,000 is 10 %
Income between 500,000 to 750,000 has a new rate of 15%
Income between 750,000 to 1,000,000 remains at 20%
Income between 1,000,000 to 2,000,000 has a new rate of 25%
Income between 2,000,000 to 4,000,000 remains at 30%
Income from 4,000,001 upward has a new rate of 35 % (slashed from 37%)
Calculation below based on old Income Tax rates, must be recalculated
In the sample it is less than 100,000, so 5% income tax of 61,300 baht = 3065 baht personal withholding tax times 3 years ownership = 9200 baht to be paid as personal income withholding tax to the land office at the time of ownership transfer and registration from seller to buyer.
As you owned the condo less than 5 years specific business tax is charged at a rate of 3%, plus a municipal tax of 10% over the amount of the specific business tax, bringing it to 3.3% x 800,000 = 26,400 baht. (note: specific business tax is applied over the selling price or gov appraised value whichever is higher).
The transfer fee is 2% over the appraised government value, in this sample the appraised value is equal to the sale price, so 2% of 800,000 baht is 16,000 baht.
In the sample expect to pay a total of around 55,000 baht all-in at the land office. Note, the actual calculation by the land office depends on variables such as the number of years of ownership, the registered actual sale price and the assessed government value of the unit.