Gift tax on Thai property: what a parent-to-child or spouse-to-spouse transfer actually costs

Does gifting a villa or land to a Thai spouse or child avoid Thai property taxes because no money changes hands? Not entirely. A lifetime gift of Thai immovable property sits under its own set of Revenue Code exemptions — separate from, and in addition to, the Land Office's transfer fee and the Specific Business Tax or stamp duty already covered in Costs, taxes and the FET form and Specific Business Tax's 5-year exemption. This guide covers the layer those don't: personal income tax on the gift itself.

The three exemption tiers under Section 42

• Immovable property gifted to a legitimate child (Section 42(26)) — exempt up to ฿20,000,000 per child, per tax year; adopted children don't qualify for this specific exemption.
• Maintenance or gifts from ascendants, descendants or a spouse (Section 42(27)) — covers a parent, grandparent, child, grandchild or registered spouse giving property or money, exempt up to ฿20,000,000 per tax year.
• Gifts received on a customary or ceremonial occasion from anyone else (Section 42(28)) — a much lower ceiling of ฿10,000,000 per tax year, relevant if the intended recipient is a long-term partner who isn't a registered spouse, or another relative outside the first two tiers.

Above the threshold: a flat 5%, not Thailand's ordinary rates

Any amount above these thresholds doesn't have to be added to the recipient's ordinary income and taxed at Thailand's progressive personal income tax rates, which run up to 35%. Sections 48(4/1), 48(6) and 48(7) of the Revenue Code let the taxpayer instead elect a flat 5% on just the excess — a materially better outcome for a large one-off transfer than folding it into a normal year's income.

This sits on top of the transfer fee, and sometimes Specific Business Tax

• The Land Office's transfer fee itself drops to 0.5% of the appraised value for a qualifying gift between direct family (parent-child or spouse-spouse), instead of the standard 2% — a separate saving from the income-tax exemption above, applied automatically at registration.
• The Specific Business Tax exemption is narrower. As covered in Specific Business Tax's 5-year exemption, only a gift to a legitimate child is explicitly SBT-exempt — a gift to a spouse or parent doesn't get that specific carve-out, and instead needs to qualify under the ordinary 5-year holding or 1-year house-registration tests, or pay 0.5% stamp duty when SBT doesn't apply.

Who this actually applies to, given the foreign-ownership ban

Because a foreigner cannot hold Thai land directly (see How foreigners legally own a villa), the party making or receiving a land gift under Section 42(26) or (27) has to be someone who can lawfully hold that land — typically a Thai spouse, or the Thai side of a company structure, gifting to their own Thai children while still alive. A foreign spouse's interest in that land is usually protected separately, through a registered usufruct or superficies, which isn't affected by who holds the underlying title.

Exactly who is liable to pay — donor or recipient — is where sources diverge in practice: some describe the 5% as collected from the recipient at the point of Land Office registration, others describe it as effectively falling on the transferor alongside the other transfer-day taxes. Settle this in writing between the parties before signing, and have a Thai tax advisor confirm the calculation. Used deliberately, a lifetime gift within the ฿20 million exemption is a legitimate way for a Thai family member to move land to the next generation early — an alternative worth weighing against simply waiting for intestate succession or the ฿100 million inheritance tax threshold to eventually apply instead.