Understanding Inheritance Tax
Before discussing inheritance tax, let's briefly explain what "inheritance tax" is.
Inheritance tax is a tax levied on the value of the inheritance each heir receives from the deceased's estate. The heirs are responsible for paying the tax, and there are often deductions and tax rates that benefit heirs closely related to the deceased. This results in closer heirs bearing a lower tax burden because they pay a proportional tax on the value of the inheritance they receive.
__________________________________________
When does Inheritance Tax occur?
It occurs when the deceased dies. If each heir receives a net inheritance, either in one lump sum or in multiple lump sums, and the total value exceeds 100 million baht, they are liable to pay the tax as stipulated by law.
__________________________________________
Who is liable to pay inheritance tax?
Those liable to pay inheritance tax are the recipients of each inheritance from the deceased, whether received in one lump sum or in multiple lump sums, if the total value of the inherited assets exceeds 100 million baht. After deducting any inherited debts exceeding 100 million baht, inheritance tax must be paid only on the amount exceeding 100 million baht.
__________________________________________
Calculation of Asset Value on Inheritance Tax Date
All types of real estate, including houses, condominiums, and land, are subject to inheritance tax. There are two main cases:
Real Estate Located in Thailand
The assessed value of the real estate for the purpose of collecting registration fees for rights and legal transactions under the Land Code shall be used, minus any encumbrances or liens, according to the criteria stipulated in the ministerial regulations.
Real Estate Located Abroad The value is calculated as follows:
1. If the real estate is located in a country with an assessed value for registration of rights and legal transactions, the assessed value of the real estate for the purpose of collecting registration fees for rights and legal transactions shall be used according to the laws of that country.
2. If the real estate is located in a country without an assessed value for registration of rights and legal transactions, the price certified by an authorized agency or organization in the country where the real estate is located shall be used.
3. In other cases, the market price on the date of inheritance shall be used.
__________________________________________
Inheritance Tax Rates
Inheritance Tax: Those liable for inheritance tax must calculate and pay tax at a rate of 10% of the taxable value of the inheritance. However, if the heir is a parent or descendant, the tax rate is 5% of the net taxable value of the inheritance.
__________________________________________
Filing and Payment of Inheritance Tax
Those liable for inheritance tax must file an inheritance tax return (Form 60) and pay the tax within 150 days from the date of receiving the inheritance. The form can be printed from the Revenue Department's internet system and can be filed and paid at any branch of the Regional Revenue Office or at other locations as designated by the Director-General.
In cases of filing and paying the tax after the specified deadline, the tax must be paid along with a surcharge of 1.50% per month or fraction thereof on the tax due, with a penalty of twice the amount of tax due. The surcharge will be calculated from the deadline for filing the return until the date of full payment.
The appointment of an executor to act on behalf of the taxpayer must be made within 180 days. If no executor is appointed, the process must be completed. The heirs entitled to inherit the deceased's estate are required to file tax returns and pay taxes within 150 days of the expiration of the 180-day deadline. In cases of multiple heirs, they must agree to designate one heir as the responsible party for paying the taxes. If they cannot reach an agreement, any heir may petition the court to appoint an executor of the estate.
__________________________________________
(Thank you for the valuable information from DD-Property)
