VAT and withholding tax on commercial rent in Thailand
When a company rents an office, shop or warehouse in Thailand, the invoice is rarely a single number. Rent and service charges are taxed differently, the tenant often withholds tax, and stamp duty and property tax sit in the background. Here is how it fits together, for tenants and landlords.
VAT: rent vs services
Under the Revenue Code, leasing immovable property is exempt from VAT. Services provided with the space are not: building management and service charges, furniture and equipment rental, cleaning and security, and utilities charged above cost are subject to VAT if the provider is VAT-registered (turnover above ฿1.8 million a year). The VAT rate is 7%, reduced from the statutory 10%; the government has approved keeping 7% until 30 September 2027.
Withholding tax: what the tenant deducts
| Payment | Withholding rate | Form |
|---|---|---|
| Rent to a Thai individual landlord | 5% | PND 3 |
| Rent to a Thai company landlord | 5% | PND 53 |
| Service fees | 3% | PND 3 or PND 53 |
| Rent to a foreign landlord without a Thai business | 15% | PND 54 |
A company tenant deducts the tax from each payment, files the return and pays it to the Revenue Department by the 7th of the following month on paper (later with e-filing), and gives the landlord a withholding tax certificate. The landlord then credits that amount against their own income tax. Individuals renting a home for themselves generally do not need to withhold.
Example: a company pays ฿100,000 rent and ฿50,000 service fee a month to a VAT-registered company landlord. The service fee carries ฿3,500 VAT. The tenant withholds ฿5,000 on the rent and ฿1,500 on the service fee, and transfers the balance to the landlord.
Stamp duty
A lease attracts stamp duty of ฿1 for every ฿1,000 of total rent over the term, about 0.1%. By law the landlord pays, but many leases shift it to the tenant. It must be paid within 15 days, by e-stamp for electronic contracts or at the Revenue Department. An unstamped lease cannot be used as evidence in a Thai court, and late payment attracts surcharges. Service agreements are not subject to this duty, another reason for the split.
Land and Building Tax
Since 2020, owners pay an annual Land and Building Tax. Commercial property falls into the "other use" category, with rates rising by appraised value from 0.3% up to 0.7%. The legal obligation is the owner's, but commercial leases often pass the cost to the tenant, so check the clause.
The landlord's side
- Individual landlords declare rent as income, can deduct a standard 30% for buildings or actual expenses, and pay progressive rates up to 35%, including a mid-year return.
- Company landlords pay corporate income tax, generally 20% of net profit, with lower rates for qualifying small companies.
- Leases over three years registered at the Land Office pay a 1% fee on the total rent. See commercial leases over 3 years.
Why prices are split into rent and service charge
Splitting the price changes where each tax applies: only the rent part carries stamp duty and the registration fee, while only the service part carries VAT and 3% withholding. For a VAT-registered tenant, the VAT on services can usually be reclaimed. The split must reflect real services, however: the Revenue Department can challenge an artificial split, such as a token rent with a very large service fee, and assess tax and penalties.
Frequently asked
Is office rent subject to VAT in Thailand?
How much withholding tax do companies deduct from rent?
Who pays stamp duty on a lease?
Who pays Land and Building Tax on a rented office?
Renting or letting commercial space?
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General information based on the Thai Revenue Code and professional commentary, checked October 2026. Tax rules change; not tax advice. Consult a Thai accountant or tax adviser.