Family Money: Get real about real estate
- Part 4
Managing director of Westminster Portfolio Services (Thailand) Ltd.
Fees & Taxes
Whenever a property in Thailand is bought or sold three
taxes have to be paid. Many buyers (especially foreigners) fail to take
these into account. It should be decided beforehand whether the buyer or
seller will be responsible for paying these.
Because of the peculiar local system of taxing property
on an arbitrary assessed value as determined by the Land Department rather
than true market value, these taxes could amount to a considerable
percentage of the purchase price.
First there is a property sales tax of 0.11% of
assessed value or the sale price whichever is higher, as well as a
transfer fee of 0.01% of the assessed value of the land. Also a stamp fee
of 0.5% of the assessed value or the sale price - again, whichever is
However, there is no property sales tax if:
* The seller has owned the property for at least five
* The seller has used the property as his primary
residence for at least one year prior to the sale.
* The seller received the property as an inheritance.
If you haven’t determined during the negotiations
that the seller will pay the taxes upon transfer, you could get a nasty
shock when a tax bill arrives - often some two or three months after the
sale is completed - since the seller often neglects to mention this
liability. (And after all, why should they tell you if you don’t already
know or ask? As in all business transactions anywhere, caveat emptor is
the rule: Let the buyer beware).
Once you have acquired property, you must pay property
taxes on it. If you rent out the property, the tax is 12.5% per year on
the annual rental revenue. (Which is why so many local rentors want the
lessee to pay tax for them, as they don’t want to lose 12.5% of their
There is also a tax on non-rental property. This
depends on location and land classification, and varies from 0.025% to
0.095% a year.
In addition, if the house is purchased through a
company, one has to bear in mind that corporate tax is higher than
personal tax, and the cost of setting up the company has to be considered
as part of the initial investment outlay, even if this is a relatively
modest additional cost - perhaps around US$1,000 all told.
Then, when you want to sell the property, it is simply
a matter of transferring the shares of the holding company to the buyer,
without the necessity of re-registering the land titles. There are of
course costs and fees involved in this exercise, but typically only a few
thousand baht all told. Again, get a professional business representative
or lawyer to do it all for you.
Selling a property ‘naked’ (i.e., without a company
‘wrapper’), you may be liable for all of the fees that were applicable
at the time of purchase (see above). You would also have to pay income tax
on the sale amount.
Deductions are calculated using a table from the Land
Department, which is based on how long you have held the property. If you
(or your local wife/girlfriend) received the land from an inheritance,
there is a standard deduction of 50%.
Otherwise, the deductions are as follows: 92% if you
have held the property for one year, 84% for two years, 77% for three
years, 71% for four years, 65% for five years, 60% for six years, 55% for
seven years, and finally reaching 50% for eight years or more.
For example, if you have held the land for four years,
the deduction is 71%. Therefore, if you sold the property for 1.25 million
baht, you would be liable for tax on 362,500 baht. This taxable income is
then divided by the number of years you held the property (divide 362,500
by 4 to get 90,625).
The tax owed is then calculated from the standard
personal income tax brackets (see the table at the end of this article).
From the tax brackets, 90,625 baht is liable to tax of 531.25 baht. You
then have to multiply by the number of years you held the property. Take
531.25 and multiply by 4 to get the final tax figure of 2,125 baht.
It may seem a bit silly to divide, and then multiply by
the number of years you held the property. However, this means that in the
end you pay less tax, because a lower base is used for the tax bracket
calculation. If this division and multiplication did not occur, in the
example above you would have had to pay 27,250 baht in income tax at
There are two further requirements:
* For sale of inherited, non-commercial or
non-investment property, the final tax figure must be no more than 20% of
the sale price.
* No matter how long you have held the property, the
number of years you use in the division and multiplication process for the
tax calculation cannot exceed 10.
There are also certain special cases where the income
tax does not apply:
* The property is inherited or is an unsolicited gift,
and is in a rural area, and the sale price is no more than 200,000 baht.
* The property is given to your children, or is
appropriated by the government.
Buying and selling property can be a complex matter,
and you should ask a lawyer for complete advice.
Tax Brackets - 2003
* Income of 0 to Bt.80,000: 0
* Bt.80,001 to 100,000: 5%
* Bt.100,001 to 500,000: 10%
* Bt.501,000 to 1,000,000: 20%
* Bt.1,000,001 to 4,000,000: 30%
* Bt.4,000,001 and above: 37%
Personal Directions: Drop a pebble in the water...
By Christina Dodd,
founder and managing director of Asia Training Associates
The simplest analogies, I find, have the most effective
results when it comes to trying to communicate. I found this poem recently by
James W Foley and I think it is a gem in demonstrating a very important and
fundamental part of our behaviour and it goes like this:
“Drop a pebble in the water; just a splash and it is
But there’s half-a-hundred ripples circling on and on and
Spreading, spreading from the center, flowing on out to the
And there is no way of telling where the end is going to
Drop a careless unkind word, and in a minute it is gone;
But there’s half-a-hundred ripples circling on and on and
They keep spreading, spreading, spreading, from the center
as they go,
And there is no way to stop them, once you’ve started
them to flow.
Drop a word of cheer and kindness; just a flash and it is
But there’s half-a-hundred ripples circling on and on and
Bearing hope and joy and comfort on each splashing, dashing
Till you wouldn’t believe the volume of the one kind word
It is a fact and it is reality that even as adults, we have
to re-learn or re-think the basics from time to time. We get carried away by
the fact that we are all grown-up and begin to masquerade the part of “being
an adult”, rather than act and live the part. So many parents are intent on
ensuring that their children develop into good human beings and in the process
of doing this, forget themselves and their own need to review their
development. We don’t suddenly reach an age and then stop learning. The
learning process begins inside the womb and continues until the day we die.
It is a rare opportunity we get to be able to take a look
inside and to do a bit of self-examination. Whenever I hold self-development
programs I remind the participants that they should look at this opportunity
as a well-deserved break away from the frantic chaos of daily life, and a
break that is going to provide them with the energy to re-charge the batteries
and clear the cob-webs! The first thing that they learn to do is to empty
their minds and to visualize the next few days as a blank piece of paper that
is going to be coloured-in using fresh new crayons. An interesting and
exciting thought and release for many, as they begin the process of
self-assessment and discovery of who they really are and what they really want
to get out of life.
If this kind of program is something you are personally
interested in and want to join, please let me know. The course runs for two
days and is very intensive in so far as it is full of activities that provoke
thought and action. It is highly interactive and requires everyone to
participate to their fullest ability. Most people end up doing this and
because they give it everything they’ve got - they gain so much benefit from
This form of program is a unique and powerful form of
personal development training that has been the catalyst for many people, in
many places, to strive for a much happier, more meaningful and more productive
It covers issues such as trust and communication, builds
self-esteem, self-confidence and self-worth in each individual. It focuses on
inner strengths, qualities and abilities and explores self-awareness, human
behaviour and attitudes. It looks at change, the need to change, and the way
to make positive changes. It examines personal values and ideals close-up.
It is a journey of discovery, of finding out about yourself
and who you really are. It is a journey that will make you realize how
important it is not to dwell in the past, but to move towards the future and
to get on with your life. It helps you to understand more deeply why it is
that you do the things that you do.
It helps you to understand the significance of goals and
why they are so essential to living life and wanting a better life. It is an
adventure that allows you to see that you have tremendous abilities hidden
inside you that you have not used and if you are able to bring them out and
use them - you can achieve so much more.
It is a profound experience that helps you feel the deep
value of relationships with those around you, with your family and the ones
you love. It helps you to understand the value and importance of your very own
This program is for people of all ages, from all parts of
society, from all backgrounds. It is for people of all nationalities, for
people of all beliefs. It is for everyone who is looking for something more -
for a life filled with purpose, achievement and above all - happiness.
In many ways it is a giant wake-up call! Much of the
content is familiar to all of us but we have, quite honestly, lost sight of
the real issues and become lost in the activities of daily life so much so
that it has not allowed us the breathing space we need - as human beings - to
continue to grow.
Many people who have participated in this style of program
with me over the years still write to me today, staying in touch even with
just a card to let me know how they are getting on with life. It is an
extremely fulfilling part of my work and I am so delighted at the fact that
they have made the effort. That speaks volumes!
If you’d like to know more and if you would like to
participate in one of our self-development programs, please contact me at
Christina. [email protected]
Until next time, have a wonderful week.
The Doctor's Consultation by Dr. Iain
Corness: Sleep Apnoea and Snoring
by Dr. Iain Corness
Snoring affects around 50% of the population at some stage
in their lives, so you are not alone! What causes snoring? Simply, it is the
tissues in the back of your throat vibrating as you breathe. Soft or loose
tissue makes the possibility of snoring much more likely, as does the depth of
There are other factors involved in the snoring pattern as
well. Lying on your back is one, as is going to bed with a skinful (nice
non-medical term) of alcohol on board. Alcohol, as many men have found out, is
a muscle relaxant, not the other way round.
Unfortunately, as we get older, we are also more likely to
snore as the muscles in your throat and soft palate lose some tension.
Enlarged tonsils (those strawberry shaped glands in the
back of your throat) can partially block the air passage and produce snoring
as well. A blocked nose from any cause will also force you to sleep with your
mouth open, and again you are more likely to snore.
Even your uvula (the thing that hangs down like the clapper
on a bell in the back of your throat) if it is large can predispose you
towards snoring, so there’s lots of chances for you to become a rip-roaring
Treatment? There’s no real specific medical treatment.
Obviously lose weight and getting generally fit helps, and avoid the skinfuls!
One old remedy was to sew a cotton reel on the back of your pyjama jacket -
this was to stop you sleeping on your back, however there’s not too many
people wearing PJ’s these days! I even read a medical article about 6 months
ago that suggested all that was needed was for one’s bed partner to give you
a kiss on the cheek. You can give this a clinical trial if you wish!
Now while snoring can be a real pain for your bed partner,
there is another condition which is much more serious called Sleep Apnoea (or
Apnea if you are American). This is where you snort for a few minutes and then
stop breathing altogether for 15-30 seconds, then restart breathing and
snoring again in a repetitive cycle. Very often this wakes the patient up and
in the morning they feel dreadful, having had a very poor night’s sleep.
What has happened here is that the air passage relaxes so
much that it closes over and stops the flow of oxygen and carbon dioxide
builds up in the blood. This raised level alerts the brain to physically
restart the breathing cycle, but unfortunately wakes the patient as well.
So what can be done about this problem? Well first you have
to do all the items that are indicated for snoring, and if that fixes the
problem, that’s fine. However, the chances are that the problem will still
be there. The treatments now are more physical. There is a special mask that
can be worn, to push oxygen into the lungs. This is called Continuous Positive
Airway Pressure (CPAP), and sufferers need to use the CPAP machine and mask
for a long time. You may have to continue it for years!
After CPAP there are various types of surgery that can be
done to remove excess flabby tissue in the back of the throat. Again these are
not fun, but may be the last resort. The doctors to see are respiratory
physicians and be guided by them.
I read all these long letters full of woe that you seem
to get every week from yet another farang who has had his heart (and
wallet) stolen by another girl of the night. They should just be more
careful, that’s all. I have found the most wonderful, tall and good
looking, perfectly groomed girl, her parents are both in good health and
her grandparents are deceased. She has no children, and no brothers or
sisters and from all reports, the buffalo is happily grazing. I am
thinking of asking her to marry me. All it takes is a little looking and
you can find the girl of your dreams in Thailand.
Dear Very Happy,
Hillary is happy for you too, Petal. There’s only
a couple of points that worry me just a little. This girl of your dreams,
did you just dream her up, or is she real? And if she is, are you sure
this is a “girl”? Check her passport immediately. Finally, before
getting down on bended knee I would suggest getting the local vet to check
the buffalo and furnish a report, witnessed by the local policeman, as
long as he is not related.
Is there an alternative to the unfriendly ‘song taew’
drivers in this city? I am so tired of their grunting when I ask them to
take me somewhere, and it really is off putting not just for me, but for
my overseas guests as well. What can be done, Hillary? It is not good for
me at all.
Dear Bussed Off,
Yes, there is an easy alternative. It’s called
My name is Noy and I is the lady in the Caring Chris
saga. (To put this letter into correct perspective, here is a very
condensed version of Caring Chris’ letter published eight weeks ago ...
“Dear Hillary, I’m blessed with exceedingly good looks, great sense of
humour, intelligent, highly educated, kind hearted and a snappy dresser.
On my first night out I was very lucky to meet an attractive girl on her
first night in the city. She came from Udon Thani and her name was Noi.
She fell for my looks and charm. She kept blowing wind in my face and said
many times, “I lub you too much.” She bowled me over and within days
we finished up in her Moo Bahn in Udon, and she wanted to marry me. After
a few days I began to get a little disappointed with the whole affair and
being woken in the middle of the night with the cockle-doodle-do’s
cockling, dogs barking, motorbikes revving up, sticky rice and somtum
daily, loud music, no hot water, creepie-crawlies and Noi’s mobile phone
constantly ringing. I then decided to call the whole thing off and went to
Pattaya. Noi said no matter what she still lubbed me too much and she
would follow me in a day or two. As I hadn’t heard from her after a week
and I still cared for her I decided to call her mobile. She said that her
Mama was “Mai sabai” and it may be a few more days before she would
come. It was just then that I got the shock of my life when this big
Harley Davidson whizzed by with my darling Noi astride the pillion with
her arms tightly clutched around the long haired driver. Needless to say,
I was devastated and hurt and for a while suffered from mild depression.
To this day I don’t know why she would associate with the looks of a man
like that and give up a man of my looks, charm and generosity. Caring
Now back to Noy’s response ... Now is the time for
all us Thai lady to stand up against the never ending whinging, bitching
and moaning the falangs sling at us, so let us look at the other side of
the coins. We did not put a gun to your head in coming here. Just because
you give us a few baht you own us? No way Jose. You say we get an Oscar
for cheating and tell lie and say Hello Handsome Man and butterfly and
sweet talk. OK we no angels, but all that is part of the package and if
you don’t like it you lump it. Wise up handsome old man. So next time
you see a young beautiful Thai lady walk down the soi’s with some old
bald headed, pot bellied, technicolour rat tail with the roots dyed grey,
consider you lucky because back home that lady would more likely be
somebody’s grandmother. Finally all you ‘Goi’s’ in the sois, and
including Ireland’s Caring Chris, put up or shut up. And Hillary, as one
lady to another I hope you agree.
Dear Noy (Udonthani),
I think you have very eloquently shown the “other
side of the coins” as you put it. The “Handsome old men” of this
world should all read and re-read your letter before coming over to
Thailand and getting involved in this situation. You have beautifully
illustrated the old adage - “You Get What You Pay For”. As Noy states,
“OK we no angels” - you have all been warned!
Camera Class: Good pictures - For One Shilling!
by Harry Flashman
I discovered an old book the other day, which I had written
about a couple of years ago. It bears repeating. My old friend, Jan Olav Aamlid
had left it for me. Called “How to make good pictures - a book for the amateur
photographer” it had been published by Kodak in London, and cost one shilling!
For one shilling you could buy a 170 glossy paged instruction book.
Unfortunately there was no date in the book, but looking at the photographs
printed in it, I would put the date at around 1920. Horse-drawn hansom cabs and
bi-planes are certainly from another era.
Things have changed photographically too. Before the world
developed that wonderful little pop-up flash on your compact camera, that
“knows” it has to come up when the light levels are low, Kodak were offering
the Amateur Flashlight Outfit for those who would brave the dark. I quote from
our one shilling book, “The procedure is simple. The powder is crushed and
mixed as indicated, then the taper is fixed in position at one end of the tray.
When ready to make the exposure, the taper is lit and the lamp slowly tilted
until the powder falls on the flame.” The book goes on a couple of pages
later, “When more than one flashlight picture is to be taken, the windows
should be opened between each flash to free the room thoroughly from smoke,
otherwise all the pictures after the first few are liable to have a slightly
Further advice to the amateur with his flash powder and taper
include, “If the room is darkened the sudden flash of light so strains the
eyes of the sitters that it almost invariably gives them a staring look, but if
the room is already illuminated by gas or electricity, the strain is not so
great and the eyes will have a natural expression.” I would imagine that
sitting in a closed room with some lunatic with crushed flash powder and a lit
taper would make anyone stare a little! Yes, we certainly get it easy these
There is one complete chapter on photographing interiors,
with exposure times quoted around the 10 minute mark. They do caution, “The
camera must be placed on a tripod or other rigid support for making time
exposures. If time exposures are made with the camera held in the hands, the
pictures will be blurred.” Now isn’t that the understatement of the year.
The mind boggles at a hand-held 10 minute time exposure!
However, it does have some very pertinent facts, still used
today. With portrait photography, the book suggests, “As an example, take a
young man with too prominent ears; it is obvious in this case that the full face
would be displeasing, so turn the face slowly away from the light until the ear
nearest the light disappears from the line of sight.” The book also says that
if this still does not fix the problem, get the young man to rest his head on
his hand and hide the appendages that way!
But for me, the best part of the book was in the first few
chapters where the basic principles of photography are explained in detail, even
showing the differences between the difference in manufacture of lenses.
Exposure control is well documented, and the amateur photographer who followed
this book through to the end would have no longer been a true “amateur”.
In those halcyon days, the budding photographer was also his
own darkroom assistant and much of the book is devoted to D&P (Developing
and Printing) and how to avoid the traps and pitfalls there-in. For those of you
who have dabbled (or rather dipped and dunked) you will agree that it does give
another dimension to picture taking, one that has all but disappeared these
days, with the advent of the 1 hour auto-processor.
No, it was a most interesting book, with some parts being decidedly
“quaint” but others still as salient today. Thank you, Jan Olav.
Recipes from Rattana: Kao Soi
This is a Burmese curry. Being a “peasant” meal from
India and the Shan states, the chicken pieces retained the bones, but fillet is
best. I use pre-prepared as Kao Soi Seasoning Mix (Lobo), available at all
Ingredients Serves 4
Chicken thigh fillet 500 gms
Coconut milk 600 mls
Lobo Kao Soi Mix 1 pkt
Fish sauce 10 mls
Soy sauce 5 mls
Lemon Juice 5 mls
Sugar 1 tspn
Cooking oil 100 mls
Egg noodles (“Bamee”) 300 gms
Peanuts (roasted and ground) 4 tbspn
Onion (chopped) 4 tbspn
Shallot (chopped) 4 tbspn
In the wok, heat 200 mls coconut milk and stir in the
seasoning mix (low heat for 2 minutes). Increase to medium heat, add chicken
thigh pieces and cook for 3 minutes.
Now add rest of coconut milk, 600 mls of water, fish sauce,
soy sauce, lemon juice and sugar. Lower heat and simmer for around 6 minutes.
In a separate wok add oil and when hot add half the egg
noodles and fry till crisp. This will not take long. Remove from the oil and
allow to drain.
In a small pot, add the remainder of the egg noodles to
boiling water and boil for 2 minutes.
Put equal portions of soft egg noodles into four bowls. Add
the chicken and curry to each. Put fried noodles on top, then sprinkle on the
onion, peanut and shallot.
Dr Byte's Computer Conundrums
Spam, scams and hoaxes
In this issue we are going to continue with our look at
spam. Many people who responded to the last couple of columns about this
issue have raised another area of concern that is addressed below.
Spam is many things to many people. To some of us it’s
the excessive number of junk e-mails we receive and what we can do about
this. It is also something else we also have to deal with and that’s hype.
Can we trust the claims made by some of these e-mails and web sites?
Maybe it’s time to remember the door-to-door
salesperson with the bag full of tricks. At least you could shut the door if
there wasn’t a foot in the way.
Scary or true? Be wary!
Most of us think of hype as exaggerated or extravagant
claims, especially in advertising or promotional material. Sometimes it is
deceptive and sometimes even deliberately misleading. I think most of us
have become a bit immune to this because of the constant exposure. But it
always seems that someone, somewhere comes up with a fresh approach that is
not immediately recognized. Con artists have been around since the beginning
of time and are always willing to take advantage of another “hot
prospect”. A little common sense should make sure you don’t fall prey to
the new scams on the block. Let’s examine a few we get by email everyday.
“Complimentary Vacation Package” - this one has been
around a long time, but has now found its way into e-mail. It usually starts
off with “Congratulations! You will be our guest in Orlando, Florida, home
of Walt Disney World, for 4 days and 3 nights. All compliments of major
Vacation Resort Developers.” Reading it, you might feel you have won a
contest. In actuality, this is not the case. It is a high pressure sales
campaign designed to sell you a “timeshare” vacation package.
Another variation promises deeply discounted vacation
packages. You pay for a package that seems great on the surface, but in
reality is either third rate accommodations or doesn’t exist at all.
“Guaranteed Winner” - they state - “You’re going
to get one of these top five prizes, guaranteed!” In this scam you
normally send some information by return email or fill out a form on a web
site. You supply your telephone number to be eligible and lo and behold, a
telemarketer calls you to confirm that you have been chosen for one of the
five “valuable” prizes; however, you must pay a processing fee for
handling, customs duties or taxes, and you must send a check or money order
to them by overnight mail. If you actually receive a prize, its usually
small trinkets of minimal value, or worthless discount coupons or vouchers.
Or, you might receive an e-mail informing you that your
order has been received and processed, and your credit card will be billed
for the charges. The trouble is, you haven’t ordered anything.
They contacted you using bulk email, using inactive
return addresses which prevent you from refuting the orders by email. They
do provide a telephone number in the area code 767, which is actually in the
West Indies. They try to keep callers on the line as long as possible, and
you are reportedly billed as much as $25 per minute. Be aware that your
local telephone company will bill for any Thai Telephone services provided.
Another current scam offers you a cut of stolen money
from Nigeria that was stolen and they need your help getting the money out
of the country. They of course want a cut of the money that they claim will
be wired to your personal bank account. You of course are expected to pay
them their share up front. The money, however, never arrives in your bank.
This is just a variation of the Nigeria Scam which I am sure you already
know about. You do, don’t you?
One group sends hundreds of thousands of unsolicited
emails to people directing them to web sites promoting the Mega$Nets and
MegaResource programs. When you visit one of their web sites you can
download copies of the software program which contains a list of five names
and addresses. The software program and web sites direct you to send twenty
dollars to each of five people listed in the software in order for you to
get yourself placed at the top of the list of names. A variation of this one
is the 15 year old boy, who’s mother found $70,000 in his bedroom one day.
This is simply the old fashioned chain letter. Actually, there are a lot of
chain letters floating about the web and all should be avoided.
Another email promises guaranteed Credit Card approval!
One group offered Visa cards to the credit-challenged “to put you back in
the mainstream of financial life in high style” at an interest rate of
only 4.9%. How? Through the magic of using offshore banks in tax haven
countries. There is, however, a $100 processing fee and $25 per month charge
regardless of use.
Some people really believe that they have been selected
to be in the Internet Version of “Who’s Who”. This one started years
ago and was sent to every company executive in the USA - They will include
your listing at no charge - oh, would you like a copy? “Send $98 to us and
it will be delivered to your doorstep.”
The latest scam I personally received was from UK Lotto
International telling me that I was a Category B Winner and so long as I
contact the sender within 1 week, I could collect a considerable amount of
Sterling. The e-mail included a detailed explanation of how the sender made
their cut of the proceeds. A look at the real UK International Lottery Web
Site immediately exposed the scam with an exact copy of the e-mail I
received warning that this was a hoax. Sad but true, so no, I didn’t win a
penny. But then the good side is I didn’t lose my arm and a leg too.
There is simply no way to adequately cover all the scams
that are around at this time. So before jumping into any of these “make a
million while you sleep” plans, use a little “due diligence” and check
them out. The money you save will be your own.
If you have any tips that you’d like to share, or any
questions about your internet or pc experience, contact me: Dr Byte,