Buying property in Thailand as a foreigner

Thailand is a sought-after destination for foreigners to purchase property, be it for personal use, rent, or retirement. There are, however, limitations on foreign ownership under Thai property laws. Here’s how foreigners can legally own property in Thailand, through what means, and everything you need to know before buying.

Do Foreigners Can Own Land in Thailand?

Thai law prohibits foreigners from owning land in the country; however, they are allowed to legally own condos and lease land under certain circumstances. Here’s how:

1. Buying a Condominium

Foreigners can own up to 49% of the overall saleable area of a condominium project. The other 51% must be held by Thais. To be eligible to own property, foreign purchasers need to verify appropriate documentation that the funds for the purchase originated from overseas.

2. Leasing Land or Property

Foreigners can rent land for a maximum of 30 years but can renew. Rent contracts must be registered at the Land Department for legal protection. This is a commonly practiced method for any foreigners who want to construct a house in Thailand but not break ownership tax rules.

3. Thai Company Ownership

Owning land with a Thai Limited Company is another option. However, it cannot exceed 49% in terms of foreign ownership of the company. Most of its owners must be Thai nationals, and the corporate structure must meet Thai corporate and real estate regulations.

4. Do You Always Get to Keep Shared Property When You Get Married?

Property can be registered under the name of a foreigner married to a Thai national (also known as a foreign owner). However, the foreign owner has to legally state that they have no interest in the property. That approach involves legal documentation that should be done very carefully to avoid future claims.

A Guide to Purchasing Property in Thailand as a Foreigner

• Hire a Trustworthy Real Estate Agent – Choosing a good local agent will help you cut through all the noise and confusion of Thailand’s property market so that you get the best deals possible and steer clear of scams.
• Hire a Thai Property Lawyer – This helps to ensure your property titles are verified, due diligence is completed, and checks for Thai property law compliance are completed. You must protect your investment.
• Transfer Funds Correctly – For condo purchases, the money should come from a foreign bank account to a Thai bank account and be documented for “the purchase of property.” This is important for the registration of ownership.
• Register the Property – With condominiums, the ownership transfer is at the Land Office, where you also need to pay the taxes and fees. If the land is leased, then the lease must be registered as well for legal protection.

Taxes and Fees When Purchasing Property in Thailand

Buyers can expect the following costs:

• Transfer Fee – 2% of the value of the property.
• Withholding Tax – 1% on entities, progressive for individuals.
• Business Tax – 3.3% for resale within 5 years.
• Stamp Duty – 0.5% (if business tax doesn’t apply).

Conclusion

Foreigners need to plan their purchase meticulously, seek legal assistance, adhere to local laws, and follow proper protocols for buying property in Thailand. Even though land cannot be owned directly, condominium ownership, leasehold agreements, and company structures can all serve as valid solutions. If you take the proper steps and work with professionals, you can invest successfully in Thailand’s real estate market as a foreigner.

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