Thai law stipulates that a foreigner may not own land in his name, he has the right of ownership of buildings only. If a foreigner wishes to purchase land to build a property he has 2 options; The land is purchased on a 30 year leasehold, with an option to extend the lease for further 30 year periods. Possession of the land is assured by virtue of the fact that the property occupies the land. The lessor cannot seize the property upon expiration of the lease, as the property is separate from the land.
If a foreigner is going to operate a business in Thailand then he may purchase the freehold of the land through his Limited Company. The land will be owned by the Company and will not individual.
Foreign Ownership of Property in Thailand
1) single gentlemen
Marriage with Thai woman must be buy house and land in her name
2.) Limited Company .
Foreigners can form a Limited Company and register the land as owned by the company. The foreigner can personally own maximum 49% of the company shares, and the remaining 51% must be in the names of Thai nationals, all of whom sign undated Share Transfer Contracts at the time the company is being registered.
If any of them should ever give cause for concern, they are simply replaced with another individual of Thai nationality. This effectively puts 100% control of the company and its assets in the hands of the foreigner – the sole executive director.
The Thai shareholders have absolutely no executive power within the company, nor need they be consulted over any issues at any time. (A Thai Limited Company must have minimum 7 shareholders – for example, one foreigner and six Thais). A popular misconception which causes foreigners unneccessary concern is that such companies are owned by foreigners and could be exposed to imagined special (future) legislation by an imagined (future) extreme nationalist government with the intention of robbing foreigners of their real estate investments in Thailand. The fact is, however, that Limited Companies are owned by the shareholders, not their directors, the foreigners. As such, Limited Companies are Thai juristic entities subject to Thai commercial law, and any changes to legislation must apply to all Limited Companies, not only those whose directors happen to be foreigners.
Thai law, both commercial and personal, is not so very different from legislation in most other countries, and it applies to all juristic entities in Thailand, foreign or Thai.
TH-property Inc.’s legal officer charges 22.000 baht for the establishment of a company with the minimum requirements for ownership of land. Such companies need not do any actual trading, and yearly taxes and audit fees are very low indeed.
Foreigners can lease land on a 30 year contract which contains a clause giving the lessee first option on a further 30 years.
The same contract, registered at the Land Office (Department of Lands), can be renewed every 30 years for a maximum of 990 years.
The lessor’s heirs are bound by law to honour the agreement, and the lessee can bequeath the lease to his/her heirs in a Last Will and Testement. The weakness with this solution is that the lessor can conceivably claim that the lessee is mismanaging the land to the detriment of its value, and can sue to dissolve the agreement. the point must be proven in court, but this could be a serious headache for the lessee.
4) Buying condominium
A foreigner buying a condo must transfer funds in foreign currency from a bank account outside Thailand to a Foreign Currency Account at a Thai bank, opened in the buyer’s name.
The transfer of funds must be in the same name as the name that will appear on the final purchase contract, ie. the buyer. Use Bangkok Bank, Kasikorn Bank (f.k.a. Thai Farmer’s Bank) or Siam Commercial Bank and be sure you tell them that the purpose of opening the Foreign Currency Account is to purchase a condominium.
Transfers out of this Foreign Currency Account into a Thai Baht account or some form of Thai Baht draft or check to the seller must be made in amounts USD 10.000 or more in order to qualify for a “Tor Dor 3” Certificate, issued by the buyer’s bank to verify that the originating funding came from outside Thailand in a currency other than Thai Baht. On the “Tor Dor 3” Certificate, it should state explicitly that the Thai Baht funds are used “to purchase a condominium” in Thailand. The department of Lands (Land Office) will refuse to execute the ownership transfer if the “Tor Dor 3” Certificate cannot be produced.