Buy land and house. Pay offshore

[zib]

Hi

I'm looking towards buying a house in Phuket. The house is owned by a foreiginer and the land by his thai wife. Is there anything prohibiting me from buying this property and paying the foreiginer to a non thai bank account? To avoid exchanging a huge sum of money to baht and also any taxation problems when transferring such a huge sum into the country. To put it short. Paying them without the money ever coming into Thailand.

After the payment his wife would transfer the land to my wifes name and the house to my name. The Land Transfer Tax etc would of course be paid normally.

Is is possible to do this? Downsides?

Thank you.

[bocceball1]

First off....I am no expert ...only have bought and sold a few properties in Thailand.

Have to assume your wife is Thai.....Only Thai's can own "land" ...the few exceptions are "companies" or if you have a "special investment visa"

So assuming your wife is Thai and the seller's are willing to accept "offshore money" ....the simple answer is YES

Not sure what your problem is to.. " avoid exchanging a huge sum of money to baht and also any taxation problems when transferring such a huge sum into the country"....What IS the Taxation Problem???????????? you already state that you have no problem with the "land transfer tax"

Downside? Well if it were me I would want confirmation of your offshore funds into my account (by wire transfer....non-cancellable) before transferring the property to you and your wife's name.....Meaning ....I can take your money and run once you make the transfer and before I transfer the property!

Good Luck ...seems to me you are just making problems

[FiftyTwo]

Downside is

You pay foreigner money offshore.

Thai lady refuses to transfer land.

"My husband tries to sell my property without my knowledge" is what she tells the judge. Your money gone.

Normal house sales here are conducted at the land office with all parties and the money present.

Nobody trusts anybody.

Edited September 22, 2013 by FiftyTwo

[Gsxrnz]

Downside is

You pay foreigner money offshore.

Thai lady refuses to transfer land.

"My husband tries to sell my property without my knowledge" is what she tells the judge. Your money gone.

Normal house sales here are conducted at the land office with all parties and the money present.

Nobody trusts anybody.

And assuming the deal does go through OK and at some future date you sell the house, you will not be able to take the proceeds out of Thailand as you did not bring the money into Thailand in the first place. The only option you would have is to settle offshore in the same way that you are buying.

I'm not sure, but I dare say there is a law that probably prevents this sort of transaction from being legitimate anyway, as it deprives Thailand of foreign exchange.

[Alwyn]

your problem will come if and when you sell the house. You won't be able to transfer the money out of Thailand (plus all the opportunities you will present to the seller regarding not transferring the papers over to you etc)

[Alwyn]

your problem will come if and when you sell the house. You won't be able to transfer the money out of Thailand (plus all the opportunities you will present to the seller regarding not transferring the papers over to you etc)

[Elefteros]

you can buy a house paying offshore no problem, but for land you need to pay locally, when registering new land owner, the Land Office will ask to show money comes to Thailand to buy land and paid here, in Thailand

[bocceball1]

you can buy a house paying offshore no problem, but for land you need to pay locally, when registering new land owner, the Land Office will ask to show money comes to Thailand to buy land and paid here, in Thailand

I have bought and sold a few properties in Thailand .....never had to "show the money" ......Did have to provide them with the contract, and even then showed them a fake contract with a low price (but still believable) so could pay a lower transfer tax.

[abrahamzvi]

Downside is

You pay foreigner money offshore.

Thai lady refuses to transfer land.

"My husband tries to sell my property without my knowledge" is what she tells the judge. Your money gone.

Normal house sales here are conducted at the land office with all parties and the money present.

Nobody trusts anybody.

I really can't understand all this advantages, or disadvantages. If the money is to be paid overseas it can be handled by a lawyer and the money can be put in an "Escrow Account". This means that the money will only be transferred from this account to the vendor's account overseas once confirmation is received by the lawyer overseas that all formalities, as agreed in the sale contract, have been completed.

The other question is , is it worth it. One has to check the lawyers cost overseas and weigh it against the exchange costs. As simple as that.

[mjakob1900]

whenever you have to divest the property, you may find it difficult to repatriate the proceeds out of Thailand unless you find a buyer to pay you overseas too

[phitsanulokjohn]

Unless you want to run the risk of losing money(never good)don't do it.Like another poster said,business usually gets done down at the land office.The buyer hands the money over,the seller transfers the chanod(title deed)or vice-versa.when i bought in Pattaya years ago,unbeknown to the seller,i give a plain clothed copper my wife knew 500 baht to sit in the land office and oversee the transaction,which went smooth but was well worth the 500 baht to release me from a potentially worrying situation.

My last 3 words DON'T DO IT.

[JHenry]

Bye a condominium on your name and you will have a good sleep every night.

Edited September 22, 2013 by JHenry

[khunPer]

Talking about the payment only – not the risks and how to cover the risks – it has to my knowledge been an often-used practice to pay all or part of the money into an offshore account, especially when trading between foreigners. Normally the parts will transfer or pay that amount of money in Thai baht, which equals the value of the land at the Land Department. This may be advisable, to avoid any questions of how the misses (or a company) can afford to buy the land, unless of course she has high enough income and/or savings herself. Any overprice of land and trade price of house will be settled offshore.

The benefits are mainly the sellers, as seller avoid taxation and do not have problems transferring money out of Thailand.

The downside for the buyer is, that the buyer has not moved (enough) money into Thailand. I do not have knowledge about registration of ownership of the house at the Land Department, when no money has been paid/transferred – a buyer can have his name registered as owner of a house (not the land); whilst if you construct a house yourself, your only proof of ownership are the building permission in your name and all the construction bills. When later selling the property, it need to be sold the same way, as the buyer (by that time seller) may not be able to legally transfer his payment for the house out of Thailand.

When transferring money into Thailand for buying house (house + land), one shall ask his Thai bank to report the transfer to the National Bank and get a form, that money has been transferred into Thailand to buy property. Keep that part of the form (often a copy) approved by the National Bank, as you will be allowed to transfer a similar amount out of Thailand at a later stage. Last time I checked, the amount shall be of 20,000 USD or more in each transfer.

[personchester]

you can buy a house paying offshore no problem, but for land you need to pay locally, when registering new land owner, the Land Office will ask to show money comes to Thailand to buy land and paid here, in Thailand

I have purchased and sold several properties and it has to be done via the land-office, they have never asked where the money comes from, all they want to see is the bankers draft (cashiers chegue) of the buyer from the Thai bank and then ask to pay the property sales tax in cash which is paid 50/50 by buyer and seller, and at the end of it the buyer receives the Deeds / Chanots ... thus end of purchase / sales procedure.

[Arkady]

you can buy a house paying offshore no problem, but for land you need to pay locally, when registering new land owner, the Land Office will ask to show money comes to Thailand to buy land and paid here, in Thailand

I have bought and sold a few properties in Thailand .....never had to "show the money" ......Did have to provide them with the contract, and even then showed them a fake contract with a low price (but still believable) so could pay a lower transfer tax.

This is correct. The Land Dept never seems to ask for evidence that the sales price has actually been paid. Sometimes they ask questions like "how was the money transferred?", as if trying to establish that the money has really been paid, to which the answer is "cashier's cheque ka" but they seem only be going through the motions according to the manual with no real interest. In fact you can agree any price you like on the official sales and purchase agreement but, if this is lower than the official appraised value, they will simply tax you on the appraised value and ignore the sales price. Thai sellers commonly insist on understating the sales price on the Land Dept sales and purchase agreement form to reduce the tax burden. The downside to paying part of the sales price offshore, if of course that the offshore portion needs to be verified before the transaction is completed at the Land Dept which would mean the seller could walk away with your offshore payment and renege on the sale. Normally cashier's cheques are handed over in the Land office on signature.

Bear in mind that the Land Dept will have an appraised value for the house and the land separately, regardless as to whether there is a separate deed for the house or not.

[Cheapcharly]

Rent house or buy full foreign name condo.

Outside of this run away even if they tell you they can register a company for you.