Are you considering buying a property in Phuket? If yes, then the first thing you should know is that foreigners can buy and own property in Phuket through a variety of ownership structures and land titles. It is straightforward and is not as complicated as you might think.
“This is extended to all Thailand”
Foreigners generally face restrictions on owning land in Thailand. However, there are specific ways they can navigate these restrictions. Here are the main avenues through which foreigners can own or control land in Thailand:
1. Leasing Land
Foreigners can lease land for an initial period of up to 30 years, with an option to renew for two additional 30-year terms, making a total potential lease period of 90 years. This lease agreement can be registered at the Land Department, which offers legal recognition and some security. Additionally, the lease can be sold or transferred to another party, who will benefit from the remaining lease period and any renewal options.
Key Points on Leasing Land:
- Initial Lease Term: Up to 30 years.
- Renewal Options: Two additional 30-year terms, subject to agreement between the parties involved.
- Registration: The lease should be registered at the Land Department for legal recognition.
- Transferability: The lease can be sold or transferred to another party, who will inherit the remaining lease period and renewal options.
- Legal Advice: It is crucial to seek legal advice to ensure the lease agreement is properly drafted and legally binding.
This approach provides a viable long-term option for foreigners to control land in Thailand without direct ownership, while also maintaining flexibility through the ability to transfer the lease.
2. Owning a Condominium
Foreigners can own condominium units outright, as long as the foreign ownership in the condominium does not exceed 49% of the total area of all units combined. This is the most straightforward way for foreigners to own real estate in Thailand.
3. Register / Setting Up a Thai Company
Foreigners can set up a Thai company to own land, with the company being majority-owned (at least 51%) by Thai nationals. The 51% ownership can be shared between two Thai shareholders. However, the foreigner can hold the remaining 49% – *DDPM.
*”Moreover, additional and important information are considered highly confidential and will only be Disclosed During Private Meetings with clients.”
Key Points on Setting Up a Thai Company:
- Ownership Structure: The company must be majority-owned by Thai nationals (at least 51%), which can be shared between two Thai shareholders.
- Foreign Ownership: The foreigner can hold up to 49% of the company.
- Control: The foreigner can maintain *DDPM within the company.
- Protective Agreement: Thai shareholders *DDPM.
- Legal Advice: It is essential to seek legal guidance to ensure the company structure and agreements are legally sound and enforceable.
This approach allows foreigners to *DDPM land in Thailand while complying with local ownership regulations.
4. Investment Promotion
Under the Board of Investment (BOI) or the Industrial Estate Authority of Thailand (IEAT), foreign businesses may receive permission to own land for specific purposes such as industrial activities. This is usually subject to specific conditions and approvals.
5. Through a Thai Spouse
If a foreigner is married to a Thai national, the Thai spouse can purchase land in their name. However, the foreign spouse must sign a declaration that the funds used to purchase the land are the personal property of the Thai spouse and that the foreigner has no claim to it.
6. Inheritance
A foreigner can inherit land from a Thai spouse, but they may need to sell it within a certain period unless they can obtain approval to retain it.
Legal and Practical Considerations:
- Legal Advice: It’s crucial to consult with a legal expert familiar with Thai property law to navigate these options safely. This service can be provided by Fusion88 Group Real Estate.
- Due Diligence: Conduct thorough due diligence on the property and ensure all transactions are legally compliant. This process can be handled by Fusion88 Group Real Estate.
- Legal Documentation: Ensure all agreements, leases, and company structures are well-documented and legally sound. Fusion88 Group Real Estate offers this service to ensure all legal aspects are properly managed.
Fusion88 Group Real Estate can provide comprehensive support in legal advice, due diligence, and legal documentation, helping foreigners navigate the complexities of owning or controlling property in Thailand.
Summary:
While direct ownership of land by foreigners in Thailand is restricted, there are several methods to gain property rights or control. Leasing, owning condominiums, setting up a Thai company, investing under BOI schemes, and utilizing marital status are viable strategies. Always seek professional legal advice to ensure compliance with local laws and regulations.
The distinction lies between ‘registering a Thai company’ and ‘setting up a Thai company.’
“Registering a Thai company” typically refers to the legal process of officially establishing a business entity in Thailand. This involves submitting the necessary documentation, such as articles of incorporation, to the relevant government authorities, such as the Department of Business Development. Registering a company grants it legal recognition and allows it to operate within the bounds of the law.
On the other hand, “setting up a Thai company” encompasses a broader range of activities beyond just the legal registration. This may include securing office space, hiring employees, obtaining necessary permits and licenses, establishing bank accounts, setting up accounting systems, and developing a business plan, among other tasks. Setting up a company involves all the practical steps necessary to make the business operational and sustainable.
In summary, while registering a Thai company is a specific legal process, setting up a Thai company involves the broader process of establishing and operationalizing the business entity.