Legal GuidelinesBUYING PROPERTY IN THAILAND
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INFORMATION GUIDELINES FOR BUYING PROPRTY IN THAILAND:-
Foreigners are restricted at the moment from owning land in Thailand in their own name, here are two effective ways in which you are able to register ownership of land while still complying legally with the Thai law.
a) Form A Thai Limited Company
The most popular structure to purchase land and proeprty for foreign investors is through a Private Thai Limited Company. The fact that not only the shareholders liabilities is limited to the amount of the shares they possess, but the Thai Private Limited Company Law also allows separation between investors body and the managerial body. The Section 1096 of the Civil and Commercial Code (CCC) has provided that a Limited Company is of a kind which is formed with a capital divided into equal shares, and the liability of the shareholders is limited to the amount, if any, unpaid on shares respectively held by them. The foreigner or signee director is limited to hold a limit of 49% of the company shares who control the company in any contractural dealings. A Private thai Limited company requires a minimum of three Thai promoters and must file a Memorandum of Association, convene a statutory meeting, register the Private Thai Limited Company, and obtain a company income tax identity card. The Company must also follow strict accounting procedures as specified in the (CCC), the Revenue Code and the Accounts Act. a balance sheet must be prepared once a yeaer and be filed with the Department of Revenue and Commercial Registration. In addition, companies are required to hold any income tax due from the salary of the regular employees. A qualified accounting service is obtainable through our services if required.
b) 30 Year Lease Option
The 30 Year Leasehold Agreement is an alternative way of buying land for foreigners. The Agreements are commonly written up as 30 year leases with an amendment written into the contract for two further 30 year renewals for a lease term of a total of 90 years. The lease contract can also include clauses that will bind the owner of the land to automatically allow freehold ownership if Thai Law changes to allow foreign ownership. Also the right to sell, sub-let or transfer the Lease Agreement. this will enable you through a Leasehold contract purchase to have full control over the land but not the ownership of the Lease term.
When buying property in Thailand you need to be aware that when you transfer the property there is a government stamp duty of 0.5%, a transfer fee of 2% and a business tax of 3.3% levied against an owner who has been in registration possession of the property less than 5 years.
This is an annual tax levied on the land ownershop, this is only a very small amount and is due each year.
There is 0% inheritance tax for all family members in Thailand
Buying a condominium is perhaps the easiest option offered to foreign nationals. The only limitations are when buying a condominium is the percentage of foreign people must only be 49% or less of the units sold in the condominium complex. The money sed to purchase the condominium has to be transferred from ouf of the couuntry, be documented by a financial institute in Thailand. This is processed with a Foreign Currency Transaction Form. In order to receive a Foreign Currency Transaction form you have to open a Thai bank account in the name of your condominium will be registered in. this allows your Thai bank to document the transfer of funds. At the time of the transfer of the property you, the new owner of the condominium, will be issued with a certificate called a Chanote or the full Thai Title is a Chanote Ti Din, which is the land paper. This the only type of freehold property a non Thai can own in their own name.
Payment Instruction for Foreign Purchasers of Condominiums in Thailand under the Condominium Act 1991, a non resident foreigner who purchases a condo unit must bring the funds to pay for the condominium from oversees. this means that the entire payment must be transferred into the country in a foreign currency. The beneficiary bank, Local Thailand Bank will then issue a Foreign Exchange Transaction Certificate which should be presented to the Land Department when registering the ownership of the condominium.
PAYMENT PROCEDURE FOR BUYING A CONDO IN THAILAND
Send the funds from your bank in your foreign currency into the nominated bank account in Thailand.
HOW TO OBTAIN A FOREIGN EXCHANGE TRANSACTION CERTIFICATE
a) The name of the sender must be the same as the purchaser indicated in the sale and purchase agreement
b) The money must be transferred as foreign currency. do not convert the payment into Thai Baht before making the transfer
c) Always indicate the purpose of the transfer i.e. To purchase a condominium at Unit Number in the development Condominium Name
d) Always use the exact wording in order to avoid misinterpretation by the Land Department
DISCLAIMER : the information provided on this website is for information purposes only. No warranty is expressed or implied as to any changes to the Thai government charges or rules. Before buying a property Hua Hin Property Company will advise you to seek the advice of a qualified legal adviser / accountant or you can use the legal department we will recommend.