Buying Vs Being A Lifelong Renter

[jamescollister]

People who think they circumvent the system by putting property in their kids name should really check what will happen in the case of a divorce. I don't claim to know the law but the kids will have a guardian and it's not likely to be the man. I think the guardian can decide the fate of property owned by minors. Right or wrong? I don't know.

Wife will win custody unless she is some yabba crazy nut case in jail.

If the land is in another child's name and you have a house on it [ not related ] only a court can remove you. It has to be in the child's interest, not the mother or father interest.

So if you put land in my kids or TP kids name, it's safe for you until they are 20 years old. Courts don't sell children's inheritance easy. they would be looking at life threatening illness and money was needed for treatment.

Wife is thinking about number 3 child so if anyone is thinking about buying a house I can beat TPs bid. If timed right you can have the whole 20 years. Jim

[TommoPhysicist]

People who think they circumvent the system by putting property in their kids name should really check what will happen in the case of a divorce. I don't claim to know the law but the kids will have a guardian and it's not likely to be the man. I think the guardian can decide the fate of property owned by minors. Right or wrong? I don't know.

Wife will win custody unless she is some yabba crazy nut case in jail.

If the land is in another child's name and you have a house on it [ not related ] only a court can remove you. It has to be in the child's interest, not the mother or father interest.

So if you put land in my kids or TP kids name, it's safe for you until they are 20 years old. Courts don't sell children's inheritance easy. they would be looking at life threatening illness and money was needed for treatment.

Wife is thinking about number 3 child so if anyone is thinking about buying a house I can beat TPs bid. If timed right you can have the whole 20 years. Jim

Just to point out when a minor is registered as the owner of land, both parents have to agree on the 'land manager' (usually one of the parents). Once appointed and their name entered on the Chanote, the land manager cannot be changed (except by death), custody of the child is irrelevant.

PS

JIm, mine is also trying for another ...... the race is on.

[parallaxtech]

Foreign Ownership in Thailand

Introduction:

Foreigners from all around the world buy real estate, both residential & commercial in Thailand. This essay attempts to explain the current laws & legal options available to potential foreign (non-Thai) purchasers.

Should you find any "passages" to be ambiguous or need further clarification on any matter, please do not hesitate in contacting us.

Ownership methods:

I. Condominium:

Acquiring a condominium is gaining in popularity amongst foreigners. A condominium is a building that can have its separate portions sold to individuals or groups for personal property ownership.

Foreign purchasers are allowed under Thai law to purchase and own condominiums in Thailand.

There are five classes of criteria which alternative qualify foreigners as owners of condominium:

a) Holding a residency permit under Thai Immigration law, or

b ) Permitted to stay in Thailand under the Investment Promotion law (BIO), or

c) A Thai registered entity with at least 51% of share held by Thai shareholder, or

d) Foreign juristic entity in receipt of a promotion certificate under the Investment Promotion law (BOI), or

e) A foreigner or foreign entity remitting a foreign currency into Thailand, or withdrawing money from Thai Baht account of the persons residing abroad, or withdrawing from foreign currency account.

Fortunately the last criteria applies to most foreign condominium purchasers and therefore it is the most typical way for foreigners to buy a condominium in Thailand.

According to the condominium act, foreigners or a foreign legal entity normally can acquire up to, but not exceeding 49% of a condominium block (direct freehold).

If a foreigner wants to register the purchase at the Land Office he has to submit a letter of guarantee from the condominium juristic person which proofs the proportion of foreign ownership among other documents. If the quota of 49% is already used, he can set a Thai company to purchase a condominium without restrictions. Another option is leasing. Condo-minium leases, like land leased are generally prepaid for 30 years with option s of renewing for two additional 30 year periods. In effect, the pre-paid rent is the same as a freehold or purchase price.

A further restriction according to the Condominium Act is that a foreigner must bring currency into Thailand to finance the purchase of the condominium. However, expats which are working in Thailand can use funds earned in Thailand on condition that their funds are paid into a non-resident account.

Further, the purchaser must obtain a Foreign Exchange Transaction form(FET) from the bank as proof of the remittance. This form will be issued by the receiving bank and is filed at the Land Department when the foreign purchaser registers the purchase. The amount of money fixed in the FET form must cover the whole of the condominium price. Should the remittance be less than $20000 USD, the bank will issue a "credit advice" in English which is not acceptable by the Land Office as proof of remittance for the condominium purchase. In case of this, the purchaser has to ask the bank to issue a "letter of guarantee" as evidence of remittance.

II. Investment / BOI:

Since 2002, a foreigner is permitted by the Ministry of Interior to purchase land up to one rai (1600 square meters) for residential purpose, on condition that he invests 40 million Baht in Thailand, for some purpose other than ownership of real estate itself. Actually, this option is problematical for the majority of foreign investors because of the legal restrictions involved and is relatively seldom used.

III. Leasing:

Leasing is a popular and straightforward option to acquire a property in Thailand. The maximum duration of a lease permitted under Thai law for non-commercial usage is 30 years, (for commercial usage 50 years),renewable for two additional terms of 30 years (commercial usage 50 years), if contractually agreed.

IMPORTANT! Any land leased for more than 3 years must be registered at the Land Department or it is only enforceable for the first three years.

It is possible under Thai law to lease land as an individual rather than through a Thai company.

IV. Corporate Ownership:

A further option is to establish a Thailand-registered company, preferably a Thai limited company, to acquire land. It needs a minimum of 3 different shareholders at all times, but only one director who can be a foreigner. At the beginning this director may have to be Thai in order to apply for the Tax ID and VAT registration of the Company. Thai law (land Code) requires that at lease 51% of the shares are held by Thai nationals and a maximum 49% of the shares may be owned by foreign shareholder because the land Code prohibition on foreign land ownership includes not only foreign individuals, but also Thai registered companies in which foreigners own more that 49% of the shares. Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

Since the foreign shareholder of the Thai Company can be a natural or a juristic person, it is possible to use an off-shore entity, e.g.a BVI (British Virgin Island) Company, for tax efficiency.

V. Managed Estates:

Currently, managed estates are very common. They all vary in structure. Normally the managed property is offered as a freehold purchase through Thai companies or with a leasehold structure concerning the buildings in combination with subscribing to a certain number of shares in a Thai company, which owns the land underneath the properties that are leased. This structure is advisable because the lessees of the buildings are more secure when they are also indirectly the "joint-landlords". With a land owning company which effectly protection that a lease is protected from being terminated by requiring typically at lease 75% of the owners to terminate a lease.

The potential problem with an "owner operated" managed estate is the necessity for the majority of the owners to confer & meet with each other. This may not be deemed as a practical or indeed attractive commitment.

[jamescollister]

Foreign Ownership in Thailand

Introduction:

Foreigners from all around the world buy real estate, both residential & commercial in Thailand. This essay attempts to explain the current laws & legal options available to potential foreign (non-Thai) purchasers.

Should you find any "passages" to be ambiguous or need further clarification on any matter, please do not hesitate in contacting us.

Ownership methods:

I. Condominium:

Acquiring a condominium is gaining in popularity amongst foreigners. A condominium is a building that can have its separate portions sold to individuals or groups for personal property ownership.

Foreign purchasers are allowed under Thai law to purchase and own condominiums in Thailand.

There are five classes of criteria which alternative qualify foreigners as owners of condominium:

a) Holding a residency permit under Thai Immigration law, or

b ) Permitted to stay in Thailand under the Investment Promotion law (BIO), or

c) A Thai registered entity with at least 51% of share held by Thai shareholder, or

d) Foreign juristic entity in receipt of a promotion certificate under the Investment Promotion law (BOI), or

e) A foreigner or foreign entity remitting a foreign currency into Thailand, or withdrawing money from Thai Baht account of the persons residing abroad, or withdrawing from foreign currency account.

Fortunately the last criteria applies to most foreign condominium purchasers and therefore it is the most typical way for foreigners to buy a condominium in Thailand.

According to the condominium act, foreigners or a foreign legal entity normally can acquire up to, but not exceeding 49% of a condominium block (direct freehold).

If a foreigner wants to register the purchase at the Land Office he has to submit a letter of guarantee from the condominium juristic person which proofs the proportion of foreign ownership among other documents. If the quota of 49% is already used, he can set a Thai company to purchase a condominium without restrictions. Another option is leasing. Condo-minium leases, like land leased are generally prepaid for 30 years with option s of renewing for two additional 30 year periods. In effect, the pre-paid rent is the same as a freehold or purchase price.

A further restriction according to the Condominium Act is that a foreigner must bring currency into Thailand to finance the purchase of the condominium. However, expats which are working in Thailand can use funds earned in Thailand on condition that their funds are paid into a non-resident account.

Further, the purchaser must obtain a Foreign Exchange Transaction form(FET) from the bank as proof of the remittance. This form will be issued by the receiving bank and is filed at the Land Department when the foreign purchaser registers the purchase. The amount of money fixed in the FET form must cover the whole of the condominium price. Should the remittance be less than $20000 USD, the bank will issue a "credit advice" in English which is not acceptable by the Land Office as proof of remittance for the condominium purchase. In case of this, the purchaser has to ask the bank to issue a "letter of guarantee" as evidence of remittance.

II. Investment / BOI:

Since 2002, a foreigner is permitted by the Ministry of Interior to purchase land up to one rai (1600 square meters) for residential purpose, on condition that he invests 40 million Baht in Thailand, for some purpose other than ownership of real estate itself. Actually, this option is problematical for the majority of foreign investors because of the legal restrictions involved and is relatively seldom used.

III. Leasing:

Leasing is a popular and straightforward option to acquire a property in Thailand. The maximum duration of a lease permitted under Thai law for non-commercial usage is 30 years, (for commercial usage 50 years),renewable for two additional terms of 30 years (commercial usage 50 years), if contractually agreed.

IMPORTANT! Any land leased for more than 3 years must be registered at the Land Department or it is only enforceable for the first three years.

It is possible under Thai law to lease land as an individual rather than through a Thai company.

IV. Corporate Ownership:

A further option is to establish a Thailand-registered company, preferably a Thai limited company, to acquire land. It needs a minimum of 3 different shareholders at all times, but only one director who can be a foreigner. At the beginning this director may have to be Thai in order to apply for the Tax ID and VAT registration of the Company. Thai law (land Code) requires that at lease 51% of the shares are held by Thai nationals and a maximum 49% of the shares may be owned by foreign shareholder because the land Code prohibition on foreign land ownership includes not only foreign individuals, but also Thai registered companies in which foreigners own more that 49% of the shares. Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

Since the foreign shareholder of the Thai Company can be a natural or a juristic person, it is possible to use an off-shore entity, e.g.a BVI (British Virgin Island) Company, for tax efficiency.

V. Managed Estates:

Currently, managed estates are very common. They all vary in structure. Normally the managed property is offered as a freehold purchase through Thai companies or with a leasehold structure concerning the buildings in combination with subscribing to a certain number of shares in a Thai company, which owns the land underneath the properties that are leased. This structure is advisable because the lessees of the buildings are more secure when they are also indirectly the "joint-landlords". With a land owning company which effectly protection that a lease is protected from being terminated by requiring typically at lease 75% of the owners to terminate a lease.

The potential problem with an "owner operated" managed estate is the necessity for the majority of the owners to confer & meet with each other. This may not be deemed as a practical or indeed attractive commitment.

Nice little read.

Question

Cooperate ownership, if you make yourself the director of a Thai company, would you not need a work permit.

And as I read it the Thai share holders have to be able to prove they invested their own money into the company. Not likely to find many locals wanting to buy shares in a house and land that makes no return just so a foreigner can live there. Jim

[parallaxtech]

From what I read you are given a work permit automatically with the company, but best to check with an atty. See below:

Thai limited company is the form of business whose capital is divided into a number of equal shares. The investors of a Thai limited company are called shareholders. It is the most popular form of business in Thailand because the liability of the shareholders is limited to the unpaid amount of the shares subscribed by them unlike Sole Proprietorships or Partnerships whose owners are exposed to unlimited liability of the business.

A Thai limited company must have at least three promoters (who become the initial shareholders of the company) who file a memorandum of association, convene a statutory meeting and register the company. During the registration, one can choose to obtain a tax identity card and to register the company into the social security system at the same time. Some companies are required to register into the VAT (Value Added Tax) system, depending on the types of business and the level of their gross income. They must also follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounting Act. Companies are required to close their accounts and have an auditor audit their books and file their audited financial statements once a year with the Revenue Department and the Department of Business Development.

A limited company registered in Thailand is considered a Thai company only if the majority of the shares are owned by Thais. If not, then that company is considered foreign according to the Foreign Business Law.

If your company is Thai majority owned, you can do almost any kind of legal business. However, if it is a foreign majority company, then you have to consult the foreign business law to see if your kind of business activity needs to obtain a foreign business license to operate in Thailand

The Thai shareholders (2) are usually friends of your lawyer so this is already prearranged and part of your fee. As far as your control/ownership -- two classes, whereby the foreignor has all voting shares and controls the company so nobody can take your land or company (see below):

Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

Edited February 12, 2013 by parallaxtech

[jamescollister]

You missed the part about shareholders -- two classes, whereby the foreignor has all voting shares and controls the company so nobody can take your land or company (see below):

Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

Lost me, are you saying you don't need a work permit to run a company in Thailand and the shareholders don't have to be able to prove they put their own money into the company.

Have a Limited Partnership company, set up by the SME Department and a good reputable business accounting company, Not read, seen or heard where I can be a managing director without a work permit. Jim

[jamescollister]

From what I read you are given a work permit automatically with the company, but best to check with an atty. See below:

Thai limited company is the form of business whose capital is divided into a number of equal shares. The investors of a Thai limited company are called shareholders. It is the most popular form of business in Thailand because the liability of the shareholders is limited to the unpaid amount of the shares subscribed by them unlike Sole Proprietorships or Partnerships whose owners are exposed to unlimited liability of the business.

A Thai limited company must have at least three promoters (who become the initial shareholders of the company) who file a memorandum of association, convene a statutory meeting and register the company. During the registration, one can choose to obtain a tax identity card and to register the company into the social security system at the same time. Some companies are required to register into the VAT (Value Added Tax) system, depending on the types of business and the level of their gross income. They must also follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounting Act. Companies are required to close their accounts and have an auditor audit their books and file their audited financial statements once a year with the Revenue Department and the Department of Business Development.

A limited company registered in Thailand is considered a Thai company only if the majority of the shares are owned by Thais. If not, then that company is considered foreign according to the Foreign Business Law.

If your company is Thai majority owned, you can do almost any kind of legal business. However, if it is a foreign majority company, then you have to consult the foreign business law to see if your kind of business activity needs to obtain a foreign business license to operate in Thailand

The Thai shareholders (2) are usually friends of your lawyer so this is already prearranged and part of your fee. As far as your control/ownership -- two classes, whereby the foreignor has all voting shares and controls the company so nobody can take your land or company (see below):

Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

You need 4 employees, or 2 if a Thai wife partner, you must pay them and all taxes associated. plus social security payments, health care etc. before you can get a W/P.

You will not get a W/P for owning a house, law states that investors must use their own money to invest.

A business that trades is a business and legal. A home for a farang is not a business. It breaks some many laws. May be not enforced at the moment, but the law and taxes will catch up in the end. Jim

[iluvbeaches]

From what I read you are given a work permit automatically with the company, but best to check with an atty. See below:

Thai limited company is the form of business whose capital is divided into a number of equal shares. The investors of a Thai limited company are called shareholders. It is the most popular form of business in Thailand because the liability of the shareholders is limited to the unpaid amount of the shares subscribed by them unlike Sole Proprietorships or Partnerships whose owners are exposed to unlimited liability of the business.

A Thai limited company must have at least three promoters (who become the initial shareholders of the company) who file a memorandum of association, convene a statutory meeting and register the company. During the registration, one can choose to obtain a tax identity card and to register the company into the social security system at the same time. Some companies are required to register into the VAT (Value Added Tax) system, depending on the types of business and the level of their gross income. They must also follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounting Act. Companies are required to close their accounts and have an auditor audit their books and file their audited financial statements once a year with the Revenue Department and the Department of Business Development.

A limited company registered in Thailand is considered a Thai company only if the majority of the shares are owned by Thais. If not, then that company is considered foreign according to the Foreign Business Law.

If your company is Thai majority owned, you can do almost any kind of legal business. However, if it is a foreign majority company, then you have to consult the foreign business law to see if your kind of business activity needs to obtain a foreign business license to operate in Thailand

The Thai shareholders (2) are usually friends of your lawyer so this is already prearranged and part of your fee. As far as your control/ownership -- two classes, whereby the foreignor has all voting shares and controls the company so nobody can take your land or company (see below):

Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

You need 4 employees, or 2 if a Thai wife partner, you must pay them and all taxes associated. plus social security payments, health care etc. before you can get a W/P.

You will not get a W/P for owning a house, law states that investors must use their own money to invest.

A business that trades is a business and legal. A home for a farang is not a business. It breaks some many laws. May be not enforced at the moment, but the law and taxes will catch up in the end. Jim

Just a quick ad on here straight from three company owners in phuket. you do not need to have a work permit as a director or owner. Department won't give you a work permit for simply being a director. If you are actively engaged in a business such as soliciting clients or tenants then you would need to employ thais and follow the above requirements.

The gray area is if you receive an email from a tenant or you send someone to fix stuff over there but upon inquiry they all were told it is not a big deal.

I guess it depends on interpretation but as we all know laws on the books and enforcement in Phuket, Samui and the south in general is notoriously poor at enforcing things. Just look at the jet ski and tuk tuk situation.

[jamescollister]

From what I read you are given a work permit automatically with the company, but best to check with an atty. See below:

Thai limited company is the form of business whose capital is divided into a number of equal shares. The investors of a Thai limited company are called shareholders. It is the most popular form of business in Thailand because the liability of the shareholders is limited to the unpaid amount of the shares subscribed by them unlike Sole Proprietorships or Partnerships whose owners are exposed to unlimited liability of the business.

A Thai limited company must have at least three promoters (who become the initial shareholders of the company) who file a memorandum of association, convene a statutory meeting and register the company. During the registration, one can choose to obtain a tax identity card and to register the company into the social security system at the same time. Some companies are required to register into the VAT (Value Added Tax) system, depending on the types of business and the level of their gross income. They must also follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounting Act. Companies are required to close their accounts and have an auditor audit their books and file their audited financial statements once a year with the Revenue Department and the Department of Business Development.

A limited company registered in Thailand is considered a Thai company only if the majority of the shares are owned by Thais. If not, then that company is considered foreign according to the Foreign Business Law.

If your company is Thai majority owned, you can do almost any kind of legal business. However, if it is a foreign majority company, then you have to consult the foreign business law to see if your kind of business activity needs to obtain a foreign business license to operate in Thailand

The Thai shareholders (2) are usually friends of your lawyer so this is already prearranged and part of your fee. As far as your control/ownership -- two classes, whereby the foreignor has all voting shares and controls the company so nobody can take your land or company (see below):

Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

You need 4 employees, or 2 if a Thai wife partner, you must pay them and all taxes associated. plus social security payments, health care etc. before you can get a W/P.

You will not get a W/P for owning a house, law states that investors must use their own money to invest.

A business that trades is a business and legal. A home for a farang is not a business. It breaks some many laws. May be not enforced at the moment, but the law and taxes will catch up in the end. Jim

Just a quick ad on here straight from three company owners in phuket. you do not need to have a work permit as a director or owner. Department won't give you a work permit for simply being a director. If you are actively engaged in a business such as soliciting clients or tenants then you would need to employ thais and follow the above requirements.

The gray area is if you receive an email from a tenant or you send someone to fix stuff over there but upon inquiry they all were told it is not a big deal.

I guess it depends on interpretation but as we all know laws on the books and enforcement in Phuket, Samui and the south in general is notoriously poor at enforcing things. Just look at the jet ski and tuk tuk situation.

Don't suppose you read the article I posted a few days ago. December 2012 Government annonced they will be checking 27,000 farang business at ramdom to see if they are real or just companies formed to circumvent Thai land laws. there is also some new laws submitted to parliament that call for deportation of foreigners involved.

There will be a glut of homes on the market if that gets passed.

Not legal way to own or control land in Thailand, unless you are a big, big player. Jim

[iluvbeaches]

From what I read you are given a work permit automatically with the company, but best to check with an atty. See below:

Thai limited company is the form of business whose capital is divided into a number of equal shares. The investors of a Thai limited company are called shareholders. It is the most popular form of business in Thailand because the liability of the shareholders is limited to the unpaid amount of the shares subscribed by them unlike Sole Proprietorships or Partnerships whose owners are exposed to unlimited liability of the business.

A Thai limited company must have at least three promoters (who become the initial shareholders of the company) who file a memorandum of association, convene a statutory meeting and register the company. During the registration, one can choose to obtain a tax identity card and to register the company into the social security system at the same time. Some companies are required to register into the VAT (Value Added Tax) system, depending on the types of business and the level of their gross income. They must also follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounting Act. Companies are required to close their accounts and have an auditor audit their books and file their audited financial statements once a year with the Revenue Department and the Department of Business Development.

A limited company registered in Thailand is considered a Thai company only if the majority of the shares are owned by Thais. If not, then that company is considered foreign according to the Foreign Business Law.

If your company is Thai majority owned, you can do almost any kind of legal business. However, if it is a foreign majority company, then you have to consult the foreign business law to see if your kind of business activity needs to obtain a foreign business license to operate in Thailand

The Thai shareholders (2) are usually friends of your lawyer so this is already prearranged and part of your fee. As far as your control/ownership -- two classes, whereby the foreignor has all voting shares and controls the company so nobody can take your land or company (see below):

Because there's no restriction under Thai law that one share must equal one vote, it is allowed to issue classified shares: The A-Shares("Ordinary Shares") where the holder one share is entitled to one vote and theB-Shares ("preferred Share") where a shareholder must have multiple shares in order to obtain one vote. The foreign shareholders will subscribe to all A-Shares, whereby the B-shares are held by Thai holders. This structure enables the foreign minority shareholder to hold fewer numbers of shares, but in fact control the company by voting rights.

You need 4 employees, or 2 if a Thai wife partner, you must pay them and all taxes associated. plus social security payments, health care etc. before you can get a W/P.

You will not get a W/P for owning a house, law states that investors must use their own money to invest.

A business that trades is a business and legal. A home for a farang is not a business. It breaks some many laws. May be not enforced at the moment, but the law and taxes will catch up in the end. Jim

Just a quick ad on here straight from three company owners in phuket. you do not need to have a work permit as a director or owner. Department won't give you a work permit for simply being a director. If you are actively engaged in a business such as soliciting clients or tenants then you would need to employ thais and follow the above requirements.

The gray area is if you receive an email from a tenant or you send someone to fix stuff over there but upon inquiry they all were told it is not a big deal.

I guess it depends on interpretation but as we all know laws on the books and enforcement in Phuket, Samui and the south in general is notoriously poor at enforcing things. Just look at the jet ski and tuk tuk situation.

Don't suppose you read the article I posted a few days ago. December 2012 Government annonced they will be checking 27,000 farang business at ramdom to see if they are real or just companies formed to circumvent Thai land laws. there is also some new laws submitted to parliament that call for deportation of foreigners involved.

There will be a glut of homes on the market if that gets passed.

Not legal way to own or control land in Thailand, unless you are a big, big player. Jim

I'm not disagreeing with you on what the law is Jim. I'm just saying the reality of enforcement based on the people I know who do this specifically in Phuket is likely because it benefits the local population and businesses too.

Makes no difference to me, I don't own a company or house or anything of the sort. I just mean to say these "crackdowns" are announced every other year and half of Patong is still foreign "owned" so it seems to be PR rather than actual enforcement. As long as you have everything sorted, pay for auditing, pay "tax" on income, accounting etc.

[jamescollister]

You are right, if no one enforces the laws you are safe, but to believe you are legal is another story. You own and live by the discretion of the law enforcement agencies.

I would rather be legal and safe, have a life here and don't want a prohibited mark on the immigration computer.

You take your chances and play the game, if it goes wrong you have to walk or run away. I will stay legal and live my life out here. Have a wife and kids, too much to risk by playing games with the law. Jim

[LennyW]

You are right, if no one enforces the laws you are safe, but to believe you are legal is another story. You own and live by the discretion of the law enforcement agencies.

I would rather be legal and safe, have a life here and don't want a prohibited mark on the immigration computer.

You take your chances and play the game, if it goes wrong you have to walk or run away. I will stay legal and live my life out here. Have a wife and kids, too much to risk by playing games with the law. Jim

So let me get this straight.... you have created a bogus company for a rubber farming company in your wifes name that you have nothing legally to do with but you funded?

Your application for an Usufruct at your wifes local amphur was rejected because you tried a "triple dunter"......you wanted the protection of an Usufruct....but you had already claimed all the benefits of an SME - and vice verse, the "company " is actually 100% your wife's and you were trying a "latch on", or did u think you would get away with it in the outskirts"?????

[iluvbeaches]

You are right, if no one enforces the laws you are safe, but to believe you are legal is another story. You own and live by the discretion of the law enforcement agencies.

I would rather be legal and safe, have a life here and don't want a prohibited mark on the immigration computer.

You take your chances and play the game, if it goes wrong you have to walk or run away. I will stay legal and live my life out here. Have a wife and kids, too much to risk by playing games with the law. Jim

I agree with you whole heartedly about the risk but these are people I know who that investment isn't close to a majority of their holdings so it isn't as bad I suppose. Like I said nothing I'd do but I think this, for all it's flaws, is a much better idea than a bar, hotel or restaurant :-)

[rgs2001uk]

To get back on track, perhaps someone could enlighten me as to how I can leverage in Thailand?

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, to me thats 3 million of "dead money", why cant I leverage the appreciation to buy a new 3 million baht condo, thus freeing up my capital?

[jamescollister]

You are right, if no one enforces the laws you are safe, but to believe you are legal is another story. You own and live by the discretion of the law enforcement agencies.

I would rather be legal and safe, have a life here and don't want a prohibited mark on the immigration computer.

You take your chances and play the game, if it goes wrong you have to walk or run away. I will stay legal and live my life out here. Have a wife and kids, too much to risk by playing games with the law. Jim

So let me get this straight.... you have created a bogus company for a rubber farming company in your wifes name that you have nothing legally to do with but you funded?

Your application for an Usufruct at your wifes local amphur was rejected because you tried a "triple dunter"......you wanted the protection of an Usufruct....but you had already claimed all the benefits of an SME - and vice verse, the "company " is actually 100% your wife's and you were trying a "latch on", or did u think you would get away with it in the outskirts"?????

Company, factory is a Limited Partnership totally legal through the SME Department. Wife lived in Australia, kids born there, use may name on passports etc in OZ. Wife has kept her Thai ID in her maiden name. Had her own land and she/we bought more land in her name, no problem it's her land.

If I could get a usufruct or any of the other titles I could legally work the land.

I don't have a W/P on the factory at the moment as we may have workers, thought we employ [ if I can get them] 10 to 16 they are % workers. Due to the world financial problems we do not buy or trade enough rubber to justify hiring 2 full time employees at the moment. That makes me just a share holder and as said can't read Thai, could only own the toilet.

You can not own or contorl the use of land in Thailand as a foreigner.

I'm legal in what I do, people are free to try and do things to circumvent the system, yet to hear of one that works. Jim

[iluvbeaches]

To get back on track, perhaps someone could enlighten me as to how I can leverage in Thailand?

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, to me thats 3 million of "dead money", why cant I leverage the appreciation to buy a new 3 million baht condo, thus freeing up my capital?

Since the real estate market is so much more speculative here due to a lack of transparency valuations cannot be properly done until after a sale.

Also, as a foreigner, you cannot get loans unless you have steady employment (even then it is hard) and I don't think you can take a mortgage on an existing property because the banks don't want to deal with a potential foreclosure on a property held under a specific legal provision (condo act). Maybe some foreign (Singapore, Hong Kong branch) might let you leverage a small home equity line with the apt as collateral but I would be surprised if it was over a few hundred thousand baht.

[davejones]

To get back on track, perhaps someone could enlighten me as to how I can leverage in Thailand?

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, to me thats 3 million of "dead money", why cant I leverage the appreciation to buy a new 3 million baht condo, thus freeing up my capital?

You could get the cash from a private investor. I know there are a few in Thailand. If you have a property in your home country, then you could re-mortgage that (at a good rate of interest) to fund another purchase here. I use my UK mortgage account as a way to get a cheap loan if I need it - 4% interest.

[iluvbeaches]

To get back on track, perhaps someone could enlighten me as to how I can leverage in Thailand?

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, to me thats 3 million of "dead money", why cant I leverage the appreciation to buy a new 3 million baht condo, thus freeing up my capital?

You could get the cash from a private investor. I know there are a few in Thailand. If you have a property in your home country, then you could re-mortgage that (at a good rate of interest) to fund another purchase here. I use my UK mortgage account as a way to get a cheap loan if I need it - 4% interest.

That's true. I did the same to pay for my condo here even though I had the cash. It's 3,5% in my country very cheap compared to what I make on other investments.

I wouldn't go the private lender route as they will want you to transfer the deed to their name and then get it transferred back upon fulfillment of the loan. Sounds risky to me.

[davejones]

To get back on track, perhaps someone could enlighten me as to how I can leverage in Thailand?

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, to me thats 3 million of "dead money", why cant I leverage the appreciation to buy a new 3 million baht condo, thus freeing up my capital?

You could get the cash from a private investor. I know there are a few in Thailand. If you have a property in your home country, then you could re-mortgage that (at a good rate of interest) to fund another purchase here. I use my UK mortgage account as a way to get a cheap loan if I need it - 4% interest.

That's true. I did the same to pay for my condo here even though I had the cash. It's 3,5% in my country very cheap compared to what I make on other investments.

I wouldn't go the private lender route as they will want you to transfer the deed to their name and then get it transferred back upon fulfillment of the loan. Sounds risky to me.

Private lending sounds too risky to me as well.

[BlackPuddingBertha]

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, ......

Ho ho ho.

You will only know what it is worth when you have actually sold it. Everything else is speculation and guesswork. Having a condo on the market for 3 years at 6MB does not make it worth 6MB.

[davejones]

Suppose I bought a condo for 3 million, our real esate experts tell me its now worth 6 million, ......

Ho ho ho.

You will only know what it is worth when you have actually sold it. Everything else is speculation and guesswork. Having a condo on the market for 3 years at 6MB does not make it worth 6MB.

You can have some idea by knowing what other condos in the building have sold for recently. Not always easy to find out, but if you know the building well, then you should have a pretty good idea. You won't know exactly, but it should be easy to know whether it's closer to 3M or 6M. If you have no idea whatsoever, then you need to put in some work to find out. The condo I rent is worth around 6.5M. I could never be certain that it would sell at that price. But I know for certain that you'd never get a condo this size in this building for under 5M. If one went up for sale less than that it would be snapped up in 5 mins. There are ways to know what a condo is worth, and you should know if you show an interest in the building, ask around, etc. You can get a good feel what's going on. If you don't know the difference between and 3M and 6M condo, then you probably shouldn't be buying condos, as you will get conned quite easily. I don't even know how you could buy in the first place if you have no idea on pricing.

[WilliamCave]

The reason we bought was so my wife and kids will have something in the future, they will own it after I am gone and not have to worry about rent . The only thing is there daily needs. And my kids will always have a place to call home.

I also have about 7 rai of land it is just sitting there also so when my kids get older they will have a good start on life with a little bit of money also. And my land value has doubled actually since I bought it.

My reasons for owning are different I have a family.

[TommoPhysicist]

The reason we bought was so my wife and kids will have something in the future, they will own it after I am gone and not have to worry about rent . The only thing is there daily needs. And my kids will always have a place to call home.

I also have about 7 rai of land it is just sitting there also so when my kids get older they will have a good start on life with a little bit of money also. And my land value has doubled actually since I bought it.

My reasons for owning are different I have a family.

But the problem is you don't have any land ........ she has the land but no money management or business skills.

So unless the land/property is in the children's names.

The moment you take your eye off the ball, it will be gambled away or she will guarantee someone else's loan or used as surety with a loan shark to back her "insert relative of choice here" scheme "insert foolish notion of choice here".

It's great you want to protect your family, but the Thai "daftness factor" will destroy any long term plan you can put in place.

Edited February 15, 2013 by TommoPhysicist

[davejones]

The reason we bought was so my wife and kids will have something in the future, they will own it after I am gone and not have to worry about rent . The only thing is there daily needs. And my kids will always have a place to call home.

I also have about 7 rai of land it is just sitting there also so when my kids get older they will have a good start on life with a little bit of money also. And my land value has doubled actually since I bought it.

My reasons for owning are different I have a family.

But the problem is you don't have any land ........ she has the land but no money management or business skills.

So unless the land/property is in the children's names.

The moment you take your eye off the ball, it will be gambled away or she will guarantee someone else's loan or used as surety with a loan shark to back her "insert relative of choice here" scheme "insert foolish notion of choice here".

It's great you want to protect your family, but the Thai "daftness factor" will destroy any long term plan you can put in place.

So I take it you've met his wife and know all this. The Thai people I know are all good with money. I've never met a Thai that has a gambling problem. My gf, for example, doesn't even buy lottery tickets. There is no way she'd gamble away the money she has after working so hard for it. Sounds like you hang out with very lo-so people. Trying getting out and about a bit more and meet some real Thais.

[TommoPhysicist]

So I take it you've met his wife and know all this. The Thai people I know are all good with money. I've never met a Thai that has a gambling problem. My gf, for example, doesn't even buy lottery tickets. There is no way she'd gamble away the money she has after working so hard for it. Sounds like you hang out with very lo-so people. Trying getting out and about a bit more and meet some real Thais.

I'm sure his wife and your gf are the exceptions to the rule.

Unfortunately my wife isn't.

Edited February 15, 2013 by TommoPhysicist

[davejones]

So I take it you've met his wife and know all this. The Thai people I know are all good with money. I've never met a Thai that has a gambling problem. My gf, for example, doesn't even buy lottery tickets. There is no way she'd gamble away the money she has after working so hard for it. Sounds like you hang out with very lo-so people. Trying getting out and about a bit more and meet some real Thais.

I'm sure his wife and your gf are the exceptions to the rule.

Unfortunately my wife isn't.

No she's not an exception. She is like most Thais I've met.

You sound like such a bitter old man. I feel very sorry for you that you have to spend your days trolling. Sad indeed.

[TommoPhysicist]

So I take it you've met his wife and know all this. The Thai people I know are all good with money. I've never met a Thai that has a gambling problem. My gf, for example, doesn't even buy lottery tickets. There is no way she'd gamble away the money she has after working so hard for it. Sounds like you hang out with very lo-so people. Trying getting out and about a bit more and meet some real Thais.

I'm sure his wife and your gf are the exceptions to the rule.

Unfortunately my wife isn't.

No she's not an exception. She is like most Thais I've met.

You sound like such a bitter old man. I feel very sorry for you that you have to spend your days trolling. Sad indeed.

I think you need to learn to speak and understand some Thai.

[WilliamCave]

The reason we bought was so my wife and kids will have something in the future, they will own it after I am gone and not have to worry about rent . The only thing is there daily needs. And my kids will always have a place to call home.

I also have about 7 rai of land it is just sitting there also so when my kids get older they will have a good start on life with a little bit of money also. And my land value has doubled actually since I bought it.

My reasons for owning are different I have a family.

But the problem is you don't have any land ........ she has the land but no money management or business skills.

So unless the land/property is in the children's names.

The moment you take your eye off the ball, it will be gambled away or she will guarantee someone else's loan or used as surety with a loan shark to back her "insert relative of choice here" scheme "insert foolish notion of choice here".

It's great you want to protect your family, but the Thai "daftness factor" will destroy any long term plan you can put in place.

Should ley u know my wife does not gamble. I do not gamble. My kids do not gamble. My wife owns a business that makes her about 60 thousand baht a month. When it comes to businessshe does have a head on her shoulders. And now after 10 years with her I am not to worried.

I am trying to figure out we're u learnt about my wife who ever u were talking to fed u full of .,..,,..

[StefanBBK]

The reason we bought was so my wife and kids will have something in the future, they will own it after I am gone and not have to worry about rent . The only thing is there daily needs. And my kids will always have a place to call home.

I also have about 7 rai of land it is just sitting there also so when my kids get older they will have a good start on life with a little bit of money also. And my land value has doubled actually since I bought it.

My reasons for owning are different I have a family.

But the problem is you don't have any land ........ she has the land but no money management or business skills.

So unless the land/property is in the children's names.

The moment you take your eye off the ball, it will be gambled away or she will guarantee someone else's loan or used as surety with a loan shark to back her "insert relative of choice here" scheme "insert foolish notion of choice here".

It's great you want to protect your family, but the Thai "daftness factor" will destroy any long term plan you can put in place.

Tommo, you are generalizing. What you describe surely often happens, but not always. There are plenty of nice, intellegent, caring and smart woman around here.

I can speak for my family and many friends, but not for all.

Sent from my GT-I9100 using Thaivisa Connect Thailand mobile app

[turgid]

I have the same concerns as the OP. I want to buy but am concerned at the current price of property. Historically boom bust in economies seems to come in 12-15 years cycles. Looking at the east west currency graphs we seem to be about due one. "The west is dead Asia is the future " rhetoric seems very similar to the "Asian tiger" words of the mid 1990's. But the game does seem to be different this time round. While demand seems to have dropped and most people I know think prices are high and are waiting, low interest rates are not forcing anyone to sell and the banks dont seem to care much about holding empty properties. Nobody seems to know how much money is coming in from China. In Singapore where there is more transparency on property transactions something like a third of all non landed properties are being bought by overseas Chinese buyers. I assume the same is true for Thailand. Nobody also seems to know the impact of Burma on all of this where either huge currency flows will come into Thailand because they now can , or go out of it as people from Burma no longer have to launder through Thailand .

I'm going to rent and wait for a year for a sign. My biggest fear is that every government is going to reach the same conclusion that the global economy is out of control and the only way to solve it is huge inflation to quietly write off the debts. In that case the poster that said buy property regardless of price is right and anyone like me with savings but no income or hard assets is going to be destroyed. My other concern is the disorientating feeling that maybe there will be no correction, the world has just changed and I don't get it. An old Chinese guy 10 years ago told me with a little anger that people like me are insane to pay S$5 for a cup of starbucks when he could buy a coffee for 30 cents. I saw a development on Wireless Road where they are selling 25 year lease 90 Sqm condos for 14 M Baht which means you have no house and no capital after 25 years. The girl told me they had two units left and foreigners were buying to have a place downtown. The million dollar basic condo has become the norm in Singapore, maybe Thailand is going the same way.

I currently feel the same sense of world insanity as that old Chinese guy.