Assignment During Construction Is Not Taxed. Or Is It?

Posts / By /

A common misconception is that if an assignment agreement is not registered with government authorities, then no taxes apply.

Let’s look at how this works in practice.

Why the “Tax-Free Assignment” Illusion Arises

An assignment agreement:

  • is not registered with the Land Department
  • is not accompanied by automatic tax calculation

This often leads to the incorrect conclusion:
that the tax authorities will not become aware of the transaction.

Key Point

If you receive income — it is subject to taxation.

Assignment of contractual rights is:

  • a transfer of property rights
  • and therefore taxable income

How the Tax Authorities Learn About the Transaction

Information does not come through registration, but through the developer.

The structure typically looks like this:

  1. Original agreement with the first buyer
  2. Tripartite agreement (original buyer — new buyer — developer)
  3. New agreement with the final buyer

These changes are recorded in the developer’s documentation and may be shared with the tax authorities.

Case Study

  • 2022 — apartment purchased for 10 million THB
  • 2023 — 6 million THB paid
  • assignment of rights for 8 million THB

Actual profit: 2 million THB

In 2025, the tax authorities:

  • send a request
  • require the assignment agreement and bank statements

Tax Calculation Result

  • Personal income tax: 350,000 THB
  • Late payment penalty: 94,500 THB

Total payable: 444,500 THB

What Is Important to Understand

Once the transaction is identified, the tax authorities:

  • request documentation
  • determine taxable income
  • assess tax and penalties

Lack of registration does not mean lack of control.

Conclusion

Assignment during construction:

  • is taxable if there is income
  • can be reviewed by tax authorities
  • requires timely declaration

Ignoring these obligations may lead to:

  • additional tax assessments
  • penalties
  • further audits

Recommendation

Tax planning should be done:

  • before entering into the transaction
  • taking into account the payment structure
  • and the expected profit

Author: Alexandra Agapitova
All rights reserved.
Copying and use of materials without written permission of the owner is prohibited.

Scroll to Top