The Board of Investment of Thailand has now focused on the housing options for low-income Thais. This approach is to enable and encourage housing developers or agencies to deliver housing facilities at affordable rates in the market.
Announced on March 15, 2024, the key points of this scheme are as follows:
- Developers seeking tax privileges from the Board of Investment (BOI) must have plans to build townhouses, single-detached houses, and condominiums worth 1.5 million THB or less.
- Each townhouse or detached property must have a floor area of at least 70 square meters, while condominium units must have a minimum floor space of 24 square meters.
- To qualify for the tax privileges, property developers must also obtain endorsement from the Government Housing Bank (GHB).
- Developers interested in this promotion must submit their applications to the BOI before the end of the following year (2025).
What are the Benefits?
To stimulate the creation of affordable housing for low-income households, the Board of Investment (BOI) provides lucrative tax incentives to qualified real estate development projects.
These projects are exempt from corporate tax for up to three years, covering 100% of investment costs excluding working capital and land acquisition. These exemptions apply to investments in roads, public amenities, and public use spaces within the development's scope.
In response to the demand for affordable housing options, the Bank of Thailand's (BOI) tax incentives for developing housing for low-income Thai citizens, coupled with the government's measures to expand the price range eligible for reduced transfer and mortgage fees, aim to address this critical need. These initiatives not only benefit homebuyers and real estate developers but also have broader economic implications. By stimulating various sectors and promoting economic growth, they contribute to the overall well-being of the Thai economy.
With the government's commitment to providing accessible housing solutions, the Thai real estate market is poised for positive growth. These measures create opportunities for low-income individuals to secure affordable housing, while simultaneously supporting property developers in addressing this crucial societal need.
Not all Projects are eligible for this BOI Promotion!
To qualify for the BOI Thailand promotion, at least 80% of the project's residences must comply with the usable area and price criteria. The minimum usable area is 24 square meters for condominium units and 70 square meters for townhouses and detached houses. Furthermore, the residences can be sold solely to private individuals, and the sale price for each condominium unit or house (inclusive of land price) should not exceed THB 1.5 million.
Additionally, the projects must comply with the following:
- Have a car park, CCTV throughout the project, a 24-hour security guard, cleaning staff, a common area, and other facilities in appropriate proportions.
- Obtain BOI approval of the building plan and layout.
- Hold a permit for the construction of a building under building control laws and other relevant regulations.
- Obtain approval from the Government Housing Bank before applying the BOI.
Companies must submit applications for promotion to the BOI by the end of 2025, as per the official notification. New low-income residential projects promoted by the BOI will receive a corporate income tax exemption for the same duration as A4-promoted activities (usually three years).
Only the construction costs associated with roads, other facilities, or public utilities commonly used within the project will be considered when calculating corporate income tax exemptions. Construction costs for residences, houses, buildings, or commercial structures, regardless of whether they are intended for lease or sale, are not included.
How can we help?
The BOI formulates the schemes and we help individuals and businesses adhere to the eligibility and process parameters flawlessly. In this effort, we can help you with:
- Company Registration in Thailand - you need a company before applying for BOI Promotions
- Project Feasibility Study for BOI Promotions
- Documentation Support for BOI Application
- Setting up your Accounting and Tax Systems
All you need to do is email us your requirements at officer@konradlegal.com for our team to know you and your project. Henceforth, it is on us to enable your business to avail of BOI Promotions in Thailand.
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