Taxing a Thai property: the real cost on the French side

Almost all French-language content on Thai property claims that rent collected in Bangkok gives rise, in France, to a tax credit. That is incorrect. The France–Thailand tax treaty of 27 December 1974 eliminates double taxation by exemption with the effective-rate rule (Article 23 §1 a); the tax credit in §1 b) is reserved for a closed list of articles that includes neither Article 6, which covers income from immovable property, nor Article 13, which covers capital gains. The distinction determines what you pay, where you pay it, and what a well-prepared Thai tax return is worth — whatever ownership structure you choose.

Why does the 1974 treaty grant no tax credit on your rental income?

Signed in Bangkok on 27 December 1974 and in force since 29 August 1975, the treaty is commented on in the BOFiP under reference BOI-INT-CVB-THA — doctrine that is binding on the tax authorities, and therefore the source to cite before any law-firm commentary. Three articles are enough. Article 6 provides that income from immovable property is taxable in the State where the property is situated: your Bangkok rent falls to Thailand. Article 13 §1 sets the same rule for gains from the alienation of immovable property. Article 23 §1 a) states that income other than that referred to in §1 b) "shall be exempt from French taxes".

Everything turns on that cross-reference. §1 b), which organises the tax credit, covers a closed list: Articles 8, 10, 11, 12, 16 and 17 — shipping and air transport, dividends, interest, royalties, directors' fees, artistes and sportsmen. Neither Article 6 nor Article 13 appears: income from immovable property and capital gains fall under the exemption, and the exemption alone. The error repeated elsewhere is understandable — almost all the treaties France has signed since the 2000s use the tax-credit method. This one is fifty-one years old.

What the effective rate actually changes for your household

Exemption does not mean disappearance. Article 23 §1 c) reserves to France the right to calculate tax "at the rate corresponding to the total taxable income under French law". Your Thai rent is not taxed in France, but it is added to your French income to determine the average rate, which is then applied to your French income alone.

The effect is asymmetric: a household already in the top bracket will see its average rate barely move; a retiree with modest French income will see it shift noticeably. Same property, same rent, two opposite outcomes.

This income is reported on form no. 2047, attached to form 2042. The 2047 notice refers, for the effective rate, to line 8TI of form 2042-C, but provides for specific treatment of property income, with a possible reference to lines 4EA and 4EB. The exact box to fill in for foreign property income exempt with the effective-rate rule must be confirmed by a tax adviser for the current tax year: no filling-in instructions are given here.

The second open point is the most sensitive: the 17.2% social charges (prélèvements sociaux). Under the exemption method, the income does not enter the income-tax base, and therefore not the base for social charges on investment income either. That is the dominant analysis and it follows from Article 23 §1 a), but no BOFiP doctrine specific to the Thai case was found, and the firms consulted partly conflate the two methods. To be settled by a tax adviser before any decision.

The corollary nobody writes: every baht saved in Bangkok is a net gain

If France exempts, Thai tax is the only income tax actually borne on this rent. That changes how the Thai return should be approached.

The Revenue Code provides a flat 30% deduction on rent from immovable property: only 70% of gross rent is taxable, with the option of actual expenses if they are higher. The progressive scale starts at 0% up to THB 150,000, rises to 5% from THB 150,001 to 300,000, then to 10% from THB 300,001 to 500,000. The return must be filed before 31 March. And withholding tax is not final: it is an advance payment, and a landlord who files can claim the deduction and obtain a refund.

Under a tax-credit treaty, all of this would be neutralised: whatever you save locally, you pay back in France. Under the exemption regime, the saving is 100% net.

Two caveats. The withholding-tax rate on rent paid to a non-resident for Thai tax purposes is not established: FRANK Legal & Tax and HLB Thailand use 15% without citing a Revenue Code section, whereas rent paid by a Thai company to an individual falls under a 5% withholding regime. To be settled by a Thai tax adviser. In addition, the 35% bracket starts at THB 4 million according to the Revenue Department and at THB 5 million according to the law firms: a discrepancy to resolve before any calculation on high rents.

Why is the IFI the real hidden cost of a Thai condominium?

The doctrine is unambiguous: "the scope of the IFI is general: it corresponds to worldwide real-estate assets, that is, it includes all real-estate property and rights, held directly or indirectly, located in France or abroad" (BOFiP, BOI-PAT-IFI-10-20-20 §90). The legal basis is Articles 964 to 983 of the CGI. A condominium in Bangkok is within the base, from the first baht of its value.

The 1974 treaty changes nothing: it contains no article on wealth tax. No allocation clause, no treaty exemption. And Thailand levies no wealth tax: no double taxation, but nothing to offset either.

The contrast with a non-resident is striking. A French national whose tax domicile is outside France is liable to the IFI only on property located in France (CGI Article 964, 2°; BOFiP BOI-PAT-IFI-10-20-30): their Thai condominium is outside the base. Same property, same owner, radically different treatment. A five-year derogatory regime exists for those who return to settle in France after a period abroad; its scope should be clarified by a tax adviser.

We set out this trade-off between tax residence and ownership structure because it is decisive. We do not advise on it: it presupposes a genuine stay, the conditions of which fall under the visa regime and length of stay.

What do acquisition and ownership really cost, item by item?

At the Land Office, four levies coexist. The transfer fee is 2% of the value appraised by the authorities — not the price paid; its 50/50 split between buyer and seller is a negotiable contractual custom, not a rule of law. Specific Business Tax at 3.3% is due if the sale takes place within five years of acquisition, payable by the seller. Stamp duty at 0.5% applies otherwise: the two are alternatives and never cumulative. Withholding tax for an individual seller follows a progressive scale, with a deduction based on the holding period: the flat 1% rate seen everywhere applies to a legal entity. Without verification with the Revenue Department, we publish no quantified formula on this last point.

The 0.01% cut is not for you

According to the law firm Tilleke & Gibbins (3 July 2026), two Ministry of Interior regulations, issued after a Cabinet resolution of 30 June 2026 and published in the Royal Gazette on 1 July 2026 — a publication we have not seen ourselves — reduced the transfer fee to 0.01% of the official appraised value and the mortgage registration fee to 0.01% of the loan. The measure runs until 30 June 2027, capped at THB 7 million (€182,400) applied cumulatively to the price, the appraised value and the mortgage amount, and covers condominium units. But it requires the buyer to be an individual of Thai nationality. As of 13 September 2026, a French buyer pays 2%.

Land and Building Tax: 0.02%, not 0.3%

The Land and Building Tax Act B.E. 2562, applied since 2020, distinguishes between uses. A main residence benefits from an allowance of THB 50 million when the owner holds both land and building, THB 10 million for the building alone. A property held by a non-resident and let out never falls under this regime: it is taxed with no allowance, at 0.02% from the first baht, the scale rising from 0.02% to 0.10% depending on value (FRANK Legal & Tax scale, 7 October 2025). The 0.3% to 0.7% rates often quoted are those for commercial use. On a condominium appraised at THB 15 million, the gap between the two readings is THB 3,000 a year against THB 45,000.

That leaves the common-area fees, in the order of THB 40 to 80 per m² per month depending on the standard — a market order of magnitude, the most precise quantified source dating from 2022 — and the sinking fund, charged once on acquisition and calculated per square metre, whose amount we do not publish for lack of cross-checking. This is where our database is useful: across the 6,787 developments and 85,399 units we index, recurring-cost fields are filled in project by project, which makes it possible to quantify the cost of ownership before buying.

What a THB 15 million condominium costs, on both sides

A working assumption, not market data: a 60 m² one-bedroom apartment appraised at THB 15 million (€391,000), let at THB 50,000 a month, i.e. THB 600,000 of gross annual rent (€15,636), owned by a French tax resident.

Inheritance: French law designates, the Thai judge decides

EU Regulation 650/2012 sets a unitary principle: the law applicable to the succession as a whole is that of the State of the deceased's habitual residence at the time of death (Article 21 §1), and it applies even if it is not the law of a Member State (Article 20); Article 22 §1 allows a person to choose the law of their nationality. For a French national resident in France, it is therefore French law, including for the condominium.

Thailand does not recognise this regulation. The Act on Conflict of Laws B.E. 2481, Section 37, subjects succession to immovable property to the law of the place where the property is situated: the Land Office and the Thai judge will apply Thai law to the apartment. The result is a de facto split, one property treated under two logics. The reasoning follows from the two texts; it deserves review by a notary specialising in international successions.

On the tax side, the common fear is unfounded, but not in the hoped-for direction. The Inheritance Tax Act B.E. 2558, in force since 1 February 2016, only taxes above THB 100 million per beneficiary (€2.6 million), at 10%, reduced to 5% for a direct ascendant or descendant, with the legal spouse exempt; a return is due within 150 days. In the vast majority of cases: zero inheritance tax in Thailand. On the French side, CGI Article 750 ter, 1° subjects all property, located in France or abroad, to transfer duties where the deceased was domiciled in France — a scope that BOFiP doctrine (BOI-ENR-DMTG-10-10-30 §320) describes as "absolutely general". Article 784 A allows duties paid outside France to be offset, capped at the French tax relating to that property; but if nothing was paid in Thailand, there is nothing to offset. It is not double taxation: it is full French taxation. The absence of a France–Thailand inheritance treaty is, moreover, highly probable, but has not been verified against the official list.

What a foreign heir can keep, and what they must sell

The difference between an apartment and a villa is structural, and almost never explained.

For a condominium, Section 19/7 of the Condominium Act requires a foreign heir to notify the authorities within 60 days and to dispose of the property within a maximum of one year — unless they themselves fall within one of the eligible categories of Section 19, in particular that of the foreigner who has brought in foreign currency equal to the price. A child able to show a compliant remittance of funds can therefore keep it; failing that, the Director-General of the Department of Lands carries out a forced disposal.

For land, there is no equivalent. Section 93 of the Land Code provides that a foreign heir may be authorised by the minister to inherit within the maximum limits of Section 87; Section 94 requires land held irregularly to be disposed of within 180 days to one year, failing which it is sold by the authorities. How the two texts fit together should be confirmed by a Thai lawyer, but the direction is clear.

Probate: four to twelve months before anything moves

A court order appointing the administrator of the estate is almost always required: neither banks nor the Land Office release assets before that appointment, the only exception being small bank balances of THB 50,000 to 200,000 (€1,303 to €5,212). The firm Expat Tax Thailand, in a publication of 22 August 2025 — the only source on this point — gives observed orders of magnitude: 4 to 12 months for a simple estate, including 8 to 12 weeks of hearing delay alone, THB 100,000 to 300,000 (€2,606 to €7,818) in fees, and THB 800 to 1,050 per page of translation (€21 to €27).

A separate Thai will changes the trajectory: a dated document signed before two witnesses, whereas a foreign will must be translated, legalised and then validated by the court — a validation that is not automatic. A point to confirm with a notary: a Thai will limited to Thai assets must be drafted so as not to revoke the French will, and vice versa.

What you must declare in France

The exemption removes no obligation. The rent is declared on form no. 2047, "Revenus de source étrangère et revenus encaissés à l'étranger" (foreign-source income and income received abroad), 2026 edition, attached to form 2042: exempt, but declarable, otherwise the effective rate applied to your French income is distorted.

A Thai bank account opened to collect rent or pay charges triggers the obligation to declare any account opened, held, used or closed abroad, on form 3916 / 3916-bis. The firms' doctrine is unanimous on the existence of a fine per undeclared account per year, €1,500 in principle and €10,000 where the State concerned has not concluded an administrative assistance agreement with France. We do not decide which of the two amounts applies to Thailand: a tax treaty and an administrative assistance agreement are not the same thing. Finally, the property itself must appear in your IFI return if your assets make you liable to it.

When we model Philippe's case: 61, Bordeaux

What you can do now

Before signing, ask for the value appraised by the authorities (appraised value) of the unit as recorded at the Land Office — not the sale price. It is this value, and this value alone, that serves as the base for the 2% transfer fee and the 0.02% Land and Building Tax. Have the same document state the common-area fee per m² per month and the sinking fund charged at handover: these three figures reconstruct the real cost of ownership before you commit. Then keep every withholding-tax certificate issued by your tenant or their managing agent: it is the document that conditions the refund when you file your Thai return by 31 March.