Can Foreigners Buy Land in Thailand? Honest Advice

Summary

In this video, Joe Remax discusses foreign ownership of landed property in Thailand, explaining that while it's illegal for foreigners to own land directly, there are ways around it, such as setting up a Thai-majority owned company to hold the land title. He outlines the pros and cons of this approach, including potential legal risks and additional costs of company maintenance. Joe advises consulting a lawyer and being aware of the inherent risks involved in bypassing the law.

Takeaways

• 🏢 In Thailand, foreigners are generally not allowed to own landed properties such as townhouses, single homes, or land.
• 🏘️ The most popular method to circumvent this is by forming a Thai company to hold the land title, with certain legal precautions.
• 📝 Another legal option is leasing land for up to 60 years through a long-term lease agreement.
• 🤝 The advantage of using a company is that it allows foreigners to own land indirectly, and selling shares avoids land transfer taxes.
• ⚖️ There are risks involved with using a company, as the law requires at least 51% Thai ownership, which might lead to loss of control.
• 💼 Setting up and maintaining a company involves ongoing costs, such as monthly accounting fees and annual audits.
• 🔍 The Thai government occasionally audits shell companies, and those not generating income may be forced to shut down.
• 👮‍♂️ It's crucial to work with a competent lawyer to ensure the company is set up correctly and to mitigate legal risks.
• 💡 Condos are an exception where foreign ownership is straightforward and allowed under Thai law.
• ⚠️ The video host emphasizes that while it's possible to own landed property as a foreigner, it comes with inherent risks and should be approached with caution.

Q & A

What is the primary topic discussed in Joe Remax's video?

The primary topic discussed in Joe Remax's video is foreign ownership of landed properties in Thailand, which includes townhouses, single homes, and pieces of land.

According to Thai law, can foreigners own landed properties?

No, according to Thai law, foreigners are not allowed to own landed properties.

What are the two main options Joe Remax mentions for foreigners to own land in Thailand?

The two main options mentioned are forming a company to buy the land and leasing the land for a long term.

What is the advantage of owning land through a company in Thailand?

The advantage is that it allows foreigners to own a villa, townhouse, or piece of land under the company's name, and when selling, there are no land transfer taxes as it involves selling shares in the company.

What are the potential risks of setting up a company to own land in Thailand?

The potential risks include the requirement for the company to be 51% Thai-owned, which means foreigners cannot legally control the company, and there's a risk of proxy shareholders potentially selling off the asset.

What are the ongoing costs associated with owning a company in Thailand for land ownership?

The ongoing costs include monthly tax returns, government form filings, annual audits, and hiring an accountant, which can amount to approximately two hundred dollars a month.

What does Joe Remax suggest regarding the legal structure of a company for land ownership?

Joe Remax suggests that the legal structure should be carefully set up with proxy shareholders and signing back their voting rights to ensure the foreign owner retains control and to avoid fraud.

How does the Thai government sometimes respond to foreign-owned companies that own land?

The Thai government may audit these companies, and if they are not creating an income or running a profit within a reasonable time, they may be ordered to shut down and liquidate their assets.

What is the '30 plus 30' lease arrangement mentioned in the video?

The '30 plus 30' lease arrangement refers to the legal maximum lease term in Thailand, which is 30 years with the option to renew for another 30 years, allowing foreigners to lease land for a long term.

What advice does Joe Remax give to foreigners looking to buy property in Thailand?

Joe Remax advises foreigners to involve a lawyer, ensure the legal process is correctly followed, and understand the risks and extra costs involved in owning a company for land ownership.

What is the difference between owning a condo and owning a landed property in Thailand for foreigners?

Owning a condo is straightforward and allowed under certain criteria, while owning landed property is more complex and typically involves setting up a company or leasing.

Outlines

00:00

🏡 Foreign Ownership of Landed Properties in Thailand

Joe Remax discusses the intricacies of foreign ownership of landed properties in Thailand, such as townhouses and single homes, which are not allowed for foreigners under Thai law. He explains alternative methods, like setting up a Thai company with 51% Thai ownership to hold land title, and the concept of leasing land for up to 60 years. He warns of the legal risks involved, such as the necessity for proper structuring with proxy shareholders to maintain control and avoid potential asset loss. He also mentions the financial implications, including the costs of maintaining a company and the legal and administrative expenses involved.

05:02

📚 Navigating the Legalities of Foreign Land Ownership

In the second paragraph, Joe Remax emphasizes the importance of understanding the risks and legal requirements when foreigners attempt to acquire landed properties in Thailand. He advises consulting a lawyer to ensure all legal formalities are correctly handled to avoid complications. He outlines the potential issues that can arise from government scrutiny of companies set up for land ownership, including the risk of forced liquidation if the company does not generate income. He concludes by reiterating the need for caution, proper legal guidance, and awareness of the ongoing costs associated with owning a company as a means to own land.

Keywords

💡Foreign Ownership

Foreign ownership refers to the right of individuals or entities from outside a country to own property within that country. In the context of the video, foreign ownership of land in Thailand is restricted by law, which is a central theme. The video discusses various methods and implications of how foreigners can navigate these restrictions to own landed properties like villas or townhouses.

💡Landed Properties

Landed properties are real estate assets that include a building or structure attached to land, such as a single-family home, townhouse, or a piece of land. The video specifically addresses the challenges foreigners face in owning such properties in Thailand due to legal restrictions, making it a key concept in understanding the video's content.

💡Condos

Condos, short for condominiums, are a type of real estate where individuals own their unit while sharing ownership of common areas with other unit owners. The video script contrasts the straightforward ownership process of condos with the complexities of owning landed properties, highlighting the differences in Thai property laws.

💡Leasing Land

Leasing land is a legal method of using land in Thailand without owning it, where the title remains with a Thai citizen. The video mentions this as an alternative for foreigners who cannot own land, allowing them to lease for up to 60 years through two consecutive 30-year leases, with the right to build on the land.

💡Company Formation

Company formation is the process of legally establishing a new company. In the video, it is discussed as a common method for foreigners to indirectly own land by purchasing the land under a company they control. This method, however, comes with legal and financial considerations that are central to the video's message.

💡Proxy Shareholders

Proxy shareholders are individuals who hold shares in a company on behalf of the actual beneficial owner. The video explains that to comply with Thai law, which requires at least 51% Thai ownership, foreigners often use proxy shareholders. This practice is part of the legal strategies discussed to navigate property ownership restrictions.

💡Land Transfer Taxes

Land transfer taxes are fees or taxes imposed by the government when transferring land ownership. The video highlights that by selling shares in a company that owns the land, rather than the land itself, foreigners can avoid these taxes, which is a significant financial consideration in the property ownership process.

💡Accounting and Audit

Accounting and audit are financial processes essential for maintaining a company's legal and fiscal compliance. The video points out that owning a company in Thailand, which is often necessary for foreign land ownership, involves monthly tax returns, government forms, and annual audits, adding to the cost and complexity of ownership.

💡Government Audits

Government audits are examinations conducted by the state to ensure compliance with laws and regulations. The video warns that the Thai government occasionally audits companies, especially 'shell' companies set up for land ownership, to ensure they are operating legitimately. This is a risk factor highlighted in the video for foreigners owning land through companies.

💡Risk Mitigation

Risk mitigation involves采取措施减少或消除风险的影响。在视频中，讨论了通过合法咨询和正确的公司结构来减少绕过泰国土地所有权法律的风险。这是视频传达的关键信息之一，强调了在考虑通过公司结构拥有土地时必须理解和管理的风险。

💡Legal Counsel

Legal counsel refers to the advice and services provided by a lawyer or legal professional. The video emphasizes the importance of seeking legal counsel when navigating the complex laws surrounding foreign land ownership in Thailand. It is presented as a crucial step to ensure that all actions are lawful and to protect the foreign owner's interests.

Highlights

Foreign ownership of land in Thailand is restricted by law.

Anyone can own a condo in Thailand as long as certain criteria are met.

Landed properties include townhouses, single homes, and pieces of land.

Foreigners are not allowed to own landed properties under Thai law.

There are ways to circumvent the law, but it's not recommended without legal advice.

Leasing land is a legal option for foreigners, with a 30+30 year lease possible.

Forming a company is a popular method to own land, but it comes with risks.

When selling land through a company, there are no land transfer taxes.

The company must be 51% Thai-owned to comply with Thai law.

Proxy shareholders and signing back voting rights are common practices to maintain control.

There are risks involved with setting up a company to own land.

It's crucial to do it correctly to avoid losing control of the asset.

There are ongoing expenses associated with owning and maintaining a company.

The government may audit shell companies that do not generate income.

Legal counsel is essential to set up a company correctly and understand the risks.

The worst-case scenario could be being forced to sell the property.

Condo ownership is straightforward and legally provided for foreigners.

For landed property, it's advised to work with a lawyer to understand the costs and risks.

The video offers insights into common advice on owning property in Thailand.

There are potential pitfalls to be aware of when considering property ownership.

Transcripts

hi it's joe remax coming to you from my

office in bangkok thailand

in this video we're going to talk about

foreign ownership

of land in thailand so i have another

video

about ownership of condos

and that is pretty well straightforward

anyone can own a condo in thailand

as long as it falls under certain

criteria and certain criteria are met

not really complicated today i'm going

to talk about foreign ownership of

landed property and what do i need mean

by landed is anything attached to land

such as a townhouse a single home

a piece of land these are what i call

landed properties

under thai law foreigners are not

allowed

to own landed properties the law in

thailand

is enforced however there are

ways around it so what i'm telling you

here

is not as a lawyer it's from my

experience

in in what i've seen done in the

industry so

please my caveat is i'm not a lawyer you

should talk to a lawyer about

these things the question today is i

want i don't want a condo

or there's no condos where i want to

live i want to buy a piece of land and i

want to have a little bungalow or

something like that how do i do it

you have a couple options the most

popular

is to form a company and buy

your land in that company and i'll talk

to you about that in a second

another one is leasing land and this is

legal

if the title of the land stays with the

thai citizen

then that's fine and you can lease for

30 years plus another 30 years

you can get a long-term lease and you

can build on it

the easy case is 30 30. so

now we go back to option number one that

i talked about that

a lot of people do is setting up a

company and in that company you will

hold the title for the land it sounds

good

but there's some pitfalls so let's look

at a few pros and cons on this

one is that you can own a villa

or a townhouse or a piece of land

in the name of that company so that's

great you found a way to own the land

another pro is that when you go to sell

rather than selling the title

of the land and the associated taxes

associated with that

you can sell the shares in the company

and of course there are

no land transfer taxes when you ship

exchange shares so

that is a benefit the cons are that you

really are skirting the law the

um the law is that foreigners are not

supposed to

own land in thailand

under thai law when you set up a company

it has to be 51

thai owned so this is to say that you

actually don't

cannot control a company that's the way

the law is designed

now lawyers will structure it with proxy

shareholders and so forth and

signing back their voting rights to

avoid any fraud

that no one can sell your land from

under you

so you can you can do something like

this

and a lot of people have

okay so if you set up a company

there are a couple risks one is that

it needs to be done correctly if it's

not done correctly

and there's 51 percent

held by proxy

shareholders and they do have voting

rights

they do have the ability to to sell off

your asset

so that has to be done very carefully

and make sure that that you know

you you keep control of the voting the

another thing is expense

when you own a company it has to

submit tax returns every month it has to

fill in government forms it has to

do an audit once a year and by

so you have to factor in that extra cost

of ownership it's not

free so typically you're talking

accounting on something like that would

be about

100 150 dollars a month that you need to

factor in

and then an additional about i'm trying

to think what the number is it's

it's about fifteen thousand baht which

would be about seven hundred dollars a

year

to get your audit done so think about

that you're talking maybe two hundred

dollars a month uh to maintain the

company to hire

an accountant to do all the forms and

submission the other thing is that com

once in a while the government will kind

of focus on these kind of shell

companies and audit them and if they're

not

creating an income and running a profit

within a reasonable

amount of time they will say that you

need to shut down this company

and liquidate its assets hence

you need to be careful a little bit that

whatever advice you get for

establishing a company that your

your legal counsel helps you

and sets things up correctly

so those are the pros and cons i

i know quite a few people that do manage

to acquire a fixed asset

on on land and but you have to go in

with the eyes open you have to

understand what the risks are

it can be done understanding that

there's an inherent risk by

skirting the law i guess the worst case

scenario would be that you are forced to

sell

at some point in time so i hope that

gave you some insight to some of the

kind of um you know advice you get from

from uh chat groups and facebook

and social media and all these experts

on owning

property there are some gotchas

so be careful and if you're a foreigner

looking to buy property

you know certainly i would advise

getting a lawyer involved

i would be careful

that you select a good one if they don't

do the job correctly if the job's not

done correctly you

you you run the risk of losing your

asset

which can be significant amount of money

so

backing up condos there's no problem the

law provides for that

if you want to do some kind of landed

property wrap it up very tightly with a

lawyer

making sure that you've got everything

under control and understand that

there'll be some extra costs

involved to keep that company

operational and running

and yeah if you need any help

we're here so thank you for listening

and hope to catch you guys later

tune in next week for another video