Property Tax is imposed and collected annually. In Thailand, property tax is divided between House and Land Tax and Local Development Tax, so owners of land and/or buildings may be subject to either one or another.
House and Land Tax
The House and Land Tax Act governs property tax imposed to owners of buildings, houses, structures or land rented or used for commercial activities. It is not a tax on property values, but instead is a tax that is levied on income earned from renting out or leasing out properties.
Taxable property under house and land tax includes industrial or commercial buildings, houses not occupied by the owner and the land on which these are situated.
In the case of industrial or commercial buildings or houses situated on the land which is under the ownership of another person, the owner of the buildings or houses is liable to the local authority for the house and land tax.
The tax is imposed annually at a rate of 12.5% of actual or assessed annual rental value of the property. If a building is damaged, the rental value will be reduced considering the amplitude of the damage. If during one year the building becomes vacant, the rental value will be reduced respectively.
The taxpayer must submit the tax return at the Municipal or District Office where the land and buildings are located within February of each year. Within 30 days after being assessed, he must make the tax payment.
If the payment is made after the due date, the taxpayer will be subject to a surcharge of up to 10% of the assessed value. If the payment is made after four months past the due date, the district officer can seize or sell the property.
Local Development Tax
The Local Development Tax Act governs the tax imposed annually on the owners or the possessors of land on which nothing is built, mountains and water basins.
Local development tax is imposed at rates ranging between 0.25% and 0.95% of assessed value of the land, excluding improvements. The value of the land is determined based on the average values of land in the area where the land is located.
Land subject to land and house tax, small parcels of land for residential use, and land for agricultural purposes, and certain other categories of land are exempt of this tax.
If the land is cultivated in excess of the exempt area, the taxpayer must pay for the land that exceeds 50% of the tax rate. On the other hand, for land that is not cultivated the taxpayer must pay two times the tax rate.
The taxpayer must submit a tax return at the Municipal or District Office where the land is located within January of the first year in which the land value is evaluated. The reevaluation is usually made every four years or earlier if the land is transferred or the size of the land is increased or decreased. The taxpayer must make the payment every year within April or, in case the appraisal value is announced after the end of March, within 30 days after receiving the notification.
If the taxpayer does not file a tax return, he will be subject to a surcharge of 10% of the local development tax that is owed.
If the taxpayer fails to make the payment, he will be subject to a surcharge of 24% per annum of the tax payable or the land may be seized or sold.