Ltd co. changing name, etc.

[lordmullin]

Hi - I've seen a great looknig condo in Patong - good sq.m and price. Trouble is the guy selling it says it's NOT up for foreign ownership, but and I quote:

 

" As you said this is not Foreigner free hold unit.

This unit belongs to my paper company and I am a full power director.

Under the Thai law, Director can do anything ---- it means without anyone, 

I can change Ownership of the company with only my Signature to you..

 

In case you buy my condo  ---- I will give you my paper company with the unit.

--- ( if you established a new one --- very costly.and we need property transfer)

You can get The Unit and the Paper Company as well. it will be our negotiation.

 

In order to keep the company legal, you must prepare a financial report and submit it to the tax office.

I pay the accounting firm 20,000 TBH every year for that. That's all.

If you find a cheaper firm, it will be better, if you cannot, I will introduce mine.

I think 20,000TBH is very cheap.

 

It is the answer for you. --- Sorry for my bad English.

Excuse me, but please tell me. If all is well, the company can be transferred immediately.

Can you pay sametime? Are you in the UK now? Not Phuket?"

 

Does this look dodgy?

Thanks for any guidance - I'm new at this ????

[Gulfsailor]

Very common for properties that foreigner cannot own. The condo is in a company name. You don’t buy the condo, but the shares in the company and you become the director. The company will be a Thai company so at most you’ll acquire 49% of the shares. I suggest finding your own new accountant for the yearly audit and find your own Thai partners who can come up with the 51% (at least on paper). 

Please beware of the tax implication with an asset in a company name. If you ever want to sell the condo and the buyer is not interested in the company, the company will have to sell it and the profit in the books will be taxed. 

In my opinion it’s a lot of extra hassle and possible future cost compared to just having a condo in your private name in full. You can always check with the condo management if there is foreign allotment available in the condo building and then have the sellers company sell the condo to you as a private foreigner. You will then incur propery transfer fees, but at least no yearly accounting costs and unknown future liabilities. 

[Salerno]

13 minutes ago, lordmullin said:

Does this look dodgy?

 

Yes ... but no doubt you'll get the usual people along soon saying it's OK. If you buy using this method you are basically using a fake company to circumvent the law which could come back to bite you. How risk averse are you?  

[lordmullin]

Thanks to both of you - I will not be going any further with this one! I am quite risk-averse and want to get somewhere legit, with all i's dotted and t's crossed. Cheers Gents!

[I'll be hiring a local law firm to make sure I'm watertight.]

[VyacheslavKHV]

It is very unreliable option. Don't go for it. 

[Pilotman]

3 hours ago, Gulfsailor said:

Very common for properties that foreigner cannot own. The condo is in a company name. You don’t buy the condo, but the shares in the company and you become the director. The company will be a Thai company so at most you’ll acquire 49% of the shares. I suggest finding your own new accountant for the yearly audit and find your own Thai partners who can come up with the 51% (at least on paper). 

Please beware of the tax implication with an asset in a company name. If you ever want to sell the condo and the buyer is not interested in the company, the company will have to sell it and the profit in the books will be taxed. 

In my opinion it’s a lot of extra hassle and possible future cost compared to just having a condo in your private name in full. You can always check with the condo management if there is foreign allotment available in the condo building and then have the sellers company sell the condo to you as a private foreigner. You will then incur propery transfer fees, but at least no yearly accounting costs and unknown future liabilities. 

I agree.  Okay to go down that route for a house, but not a condo. Buy outright. 

[newbruisers23]

You don't need any of this to buy a single condo unit in Thailand.

As long as the condo building on the whole has majority Thai ownership, i.e. 51% of the units are owned by Thais, then a foreigner can own any unit in the building.

It is NOT the same as owning land, where you'd need to set up a scheme similar to what you posted -- and even in that case, it is unadvisable, but doable.

[Peterw42]

OP, the main issue with company ownership is who owns the Thai 51% of the company. Many people do the company ownership but the Thai half is a trusted Thai friend or lawyer etc.

 

[lordmullin]

Thanks everyone ????