What happens if thai tenants dont pay rent to us?

[ubonr1971]

We are thinking about buying a building as an investment. Regarding a lease contract the 2 options are

1. Get it registered at the land office for 10 yrs and tenants pay the tax for this

2. Dont register it and just have a standard contract.

 

In the event that they stop paying the rent, what happens in each of the above circumstances. I realise its all about whats in the contract, but legally do they have more rights if its registered at the land office i.e. harder to get them out.

 

In situation n.o 2 can one assume its possible to lay a heavy hand to get them out in extreme circumstances?

 

thanks

[CharlieH]

MOVED to real estate forum //

[BestB]

why would you register residential lease at the land office and whoever told you tenants would be paying the tax?

 

Unless you mean, you want to buy and rent the entire building as commercial, in which case again, what makes you think tenants would be paying the tax?

 

Tax is your responsibility not the tenants, yes you can put it on to tenants and vast majority will just walk away unless its a prime location.

 

I am also pretty certain, by law you have to register commercial lease, naturally not every one does it, to avoid tax, also known as tax evasion.

 

So what happens if tenants stop to pay rent? you would have to go to court to evict them. Should they decide to put up a fight and ask for your tax payments, then you know the answer to that.

[ubonr1971]

52 minutes ago, BestB said:

why would you register residential lease at the land office and whoever told you tenants would be paying the tax?

 

Unless you mean, you want to buy and rent the entire building as commercial, in which case again, what makes you think tenants would be paying the tax?

 

Tax is your responsibility not the tenants, yes you can put it on to tenants and vast majority will just walk away unless its a prime location.

 

I am also pretty certain, by law you have to register commercial lease, naturally not every one does it, to avoid tax, also known as tax evasion.

 

So what happens if tenants stop to pay rent? you would have to go to court to evict them. Should they decide to put up a fight and ask for your tax payments, then you know the answer to that.

tenants pay the tax bc they are motivated to register a lease at the land office to protect themselves (ie avoid being evicted and unfair rent increases). Landlords dont want this and thus the onus of the tax falls on the tenants.

[BestB]

2 hours ago, ubonr1971 said:

tenants pay the tax bc they are motivated to register a lease at the land office to protect themselves (ie avoid being evicted and unfair rent increases). Landlords dont want this and thus the onus of the tax falls on the tenants.

Tenants are motivated to have commercial lease registered ? Yes but you have not answered what kind of lease

 

No, tenants are not motivated to pay the tax because tax is owners responsibility. Making tenants pay is another version of scam and tax evasion , does not mean it stops landlords but it also does not change the fact . 

[worgeordie]

All my problems have been with Thai tenants,which

is why i don't rent to them any more.

regards worgeordie

[KMartinHandyman]

Same as tenants anywhere I bet, stop paying as long as they can, ruin the place and then disappear.

[ubonr1971]

7 hours ago, BestB said:

Tenants are motivated to have commercial lease registered ? Yes but you have not answered what kind of lease

 

No, tenants are not motivated to pay the tax because tax is owners responsibility. Making tenants pay is another version of scam and tax evasion , does not mean it stops landlords but it also does not change the fact . 

You're still in a nanny state mind set. This is thailand.

 

 

We rented a building for 10 yrs and insisted on registering the lease at the land office. the landlord didnt want to do this. we saw it as protection from future rent increases and being kicked out. we paid the tax. you are wrong when you say 'No, tenants are not motivated to pay the tax because tax is owners responsibility.'. you sound inexperienced

 

Its the same with the annual building tax. they make us pay this. its thailand. we dont go complaining about 'tax evasion'. its the way its done in thialand, nothing we can do about it. please stop thinking that your back home in the nanny state where you grew up

[smutcakes]

In Thailand in Commercial or industrial leases i would say 95% of leases put the burden of property tax on the lessee. Strictly speaking it is a landlord tax but the authorities dont care who pays it as long as it is paid. If the lessee does not want to pay it they are free to not lease at that property and try somewhere else.

 

Obviously the old Property Tax which was based on 12.5% of the rental payments which facilitated the structure of the separate lease and service agreements is being changed commencing next January. From then property tax will be changed from a lease rate based calculation to a calculation on the value of the land and building. Will be interesting to see what affect this has on property tax amounts, and whether it will abolish the current lease and service agreement structure.

 

Most landlords do not see any benefit in having registered leases so are content to use the 3+3+3 model. I suppose we will see in the coming years if it turns to a tenant market that landlords become more keen to have the additional security of tenure a registered lease creates.

 

You are required to register the lease if it is more than 3 years. The cost of registering the lease at the land department is 1.1% (1% registration, 0.1% Stamp) of the total gross lease payments.

[RichardColeman]

All the high turnover of houses in our Choc Chai is down to non-paying Thais. No, farang living here far as I have seen in the past 4 years has been removed for non-payment of rent. Unless you are doing this build in the 'sticks' then I'd avoid Thais without a serious deposit !

 

 

[BestB]

1 hour ago, ubonr1971 said:

You're still in a nanny state mind set. This is thailand.

 

 

We rented a building for 10 yrs and insisted on registering the lease at the land office. the landlord didnt want to do this. we saw it as protection from future rent increases and being kicked out. we paid the tax. you are wrong when you say 'No, tenants are not motivated to pay the tax because tax is owners responsibility.'. you sound inexperienced

 

Its the same with the annual building tax. they make us pay this. its thailand. we dont go complaining about 'tax evasion'. its the way its done in thialand, nothing we can do about it. please stop thinking that your back home in the nanny state where you grew up

Got ya, so because you were scammed , you now also going to scam ????

 

And best part is , this is thailand , so it’s ok????

[4evermaat]

18 hours ago, BestB said:

So what happens if tenants stop to pay rent? you would have to go to court to evict them. Should they decide to put up a fight and ask for your tax payments, then you know the answer to that.

 

But what happens when the lease is up?

 

My understanding is that if they don't pay, you can just get rid of them.

 

15 hours ago, worgeordie said:

All my problems have been with Thai tenants,which

is why i don't rent to them any more.

regards worgeordie

 

How much of a security deposit / rent up front do you request?  I know some thai landlords who request 2-4 months or more, especially if you want a discount.

 

But part of it is due to popularity of the area.

 

I can understand it from a business perspective.  You want to make sure the tenant will stay or be able to afford the business.

[lust]

No rent payment and you can shut off their utilities. Can’t stay in a condo very long without water and electricity.

[chilly07]

The lease/contract will dictate who pays land tax. Registering the lease ensures repossession will be by court order with costs. Non payment of rent with unregistered tenancy will lead to immediate summary repossession 

[Cricky]

19 hours ago, ubonr1971 said:

In the event that they stop paying the rent,

This would be the least of your problems.

 

A mate of mine had an apartment building, all tenants were Thai.

He had endless problems with Tenants and Drugs.

 

Do yourself a favour, try another business/investment.

[Mavideol]

17 hours ago, worgeordie said:

All my problems have been with Thai tenants,which

is why i don't rent to them any more.

regards worgeordie

have one more than you.... ALL my (any kind) problems were always with the tenants regardless of their origin/background/race/color/religion thus decided to sell and no more tenants at all, ever since my previous sleepless nights disappear...., should have sold long ago

[BestB]

2 hours ago, 4evermaat said:

 

But what happens when the lease is up?

 

My understanding is that if they don't pay, you can just get rid of them.

 

 

How much of a security deposit / rent up front do you request?  I know some thai landlords who request 2-4 months or more, especially if you want a discount.

 

But part of it is due to popularity of the area.

 

I can understand it from a business perspective.  You want to make sure the tenant will stay or be able to afford the business.

If the lease is up and you have not signed a new lease it becomes month by month lease where either party can break the lease by giving 30 days notice 

[BestB]

24 minutes ago, Mavideol said:

have one more than you.... ALL my (any kind) problems were always with the tenants regardless of their origin/background/race/color/religion thus decided to sell and no more tenants at all, ever since my previous sleepless nights disappear...., should have sold long ago

In case of OP I think he is referring to commercial lease, though refusing to confirm . 
 

but I guess now you understand why there is “key money “ at least have a lump sum to fall back on in case of idiotic tenants????

[Captain 776]

I dont know the law here but in USA the tenants have way more rights than the homeowner landlord and NEVER EVER rent to Section 8 low income.........NEVER

[tifino]

21 hours ago, ubonr1971 said:

tenants pay the tax bc they are motivated to register a lease at the land office to protect themselves (ie avoid being evicted and unfair rent increases). Landlords dont want this and thus the onus of the tax falls on the tenants.

sounds more like a tea money bribe, than a Tax

[ross163103]

Agree with VYCM; try another business besides renting to Thais. Keep in kind you have no rights over here and unless you have LOTS of money that you can put in brown envelopes and spread around, or know some powerful, rich Thais that can help you, more than likely any police/courts will take the Thai side.

[4evermaat]

17 hours ago, Captain 776 said:

I dont know the law here but in USA the tenants have way more rights than the homeowner landlord

 

That is true overall.  But it varies state to state.   I remember Georgia having more landlord-friendly rules.  One month eviction notice and then you can have the sheriff remove the tenant.  Maybe that has changed.

 

But places like New York City tenants could stay for 6-18 months.

 

17 hours ago, Captain 776 said:

and NEVER EVER rent to Section 8 low income.........NEVER

 

Why is this?  Isn't that guaranteed income paid directly to the landlord?

[ubonr1971]

23 hours ago, lust said:

No rent payment and you can shut off their utilities. Can’t stay in a condo very long without water and electricity.

but its easy for them to open/ register new accounts in their own name

[4evermaat]

15 minutes ago, ubonr1971 said:

but its easy for them to open/ register new accounts in their own name

 

if they can open their own meter and put the deposit for them, why can't they pay the rent?

[Tomahawk21]

On 10/7/2019 at 4:53 AM, KMartinHandyman said:

Same as tenants anywhere I bet, stop paying as long as they can, ruin the place and then disappear.

why do people have to be such ass holes ?

[Democracy74]

You should only register the lease on the title deed if you have already been paid upfront for the full registered rental term.

 

If you decide to take a deposit and then take monthly payments then you should not register the lease at the land office.

 

 

[BestB]

53 minutes ago, Tomahawk21 said:

why do people have to be such ass holes ?

To pay back in kind to good landlords who make tenants pay their tax?????

 

or take 3 months to fix something 

[Tomahawk21]

12 hours ago, BestB said:

To pay back in kind to good landlords who make tenants pay their tax?????

 

or take 3 months to fix something 

ive been a very successful landlord for many many years in the UK never encountered any of these sorts of problems. i do believe if you have a good property above the breadline renters, you get better class of tenant, if any of my properties have problems i fix them straight away, not on the cheap either. had one of my tenants over 20 years and others at between 10 and 15 years. 

[GSec]

If the business plan is to rent to thais, I would advice against.

The only exception is if the building is in a student ghetto ..students are always better behaved than low/working class thais and will agree to get out quickly if they cannot pay.

 

Get a reliable handyman/painter..you'll need him regularly.

[ubonr1971]

15 hours ago, Democracy74 said:

You should only register the lease on the title deed if you have already been paid upfront for the full registered rental term.

 

If you decide to take a deposit and then take monthly payments then you should not register the lease at the land office.

 

 

This comment is BS. We registered a 10 yr lease at the land office and we offered to pay the 20k tax as it gave us protection. Do you really think any landlord is going to expect a tenant like us to pay 10 yrs rent in advance just bc we are registering a lease at the LO? ha ha