Rental income on Thai property ownership - problem if on retirement visa?

[spambot]

Does anyone have any experience of earning a rental income on Thai property owned on a retirement visa extension of stay?

Obviously one of the stipulations of the retirement visa is that you are prohibited from working while in Thailand.

However rental income is normally regarded as unearned income - Hence would normally not be considered as income from actually working.

I am looking to switch some investment into Thailand and balance this between shares and rental of property.

So while dividends from stock will not considered as being income from working – Are there are any peculiar hidden restrictions (outside of the issues on what types of property is actually allowed for ownership) on income rental from owned property (property is not owned by Thai wife – since I'm unmarried) that would directly conflict with the terms of the retirement visa?

[bangkapi]

I have a retired friend who is "flying under the radar" earning income from 20+ small units near a local university.

He says it is much better than trying to get earnings from other more risky or low yielding "investments".

[FritsSikkink]

If you pay somebody to act as the manager to fix any issues with the people who rent your house it should be ok.

If you fix the issues you are working and need a work permit.

[spambot]

I have a retired friend who is "flying under the radar" earning income from 20+ small units near a local university.

He says it is much better than trying to get earnings from other more risky or low yielding "investments".

Thanks Bankapi - So does he a). just think he could be but not sure one way or the other - or does he know for certain (and realises that he has not been found yet)?

Its good to know that he has bought so many - But I suppose that this brings up other issues more demanding like tax on the earnings which will be more visible then to immigration (if was a problem area for his visa).

[spambot]

If you pay somebody to act as the manager to fix any issues with the people who rent your house it should be ok.

If you fix the issues you are working and need a work permit.

Actually that is a good point that I had not considered - actually fixing stuff - then this becomes work - Hence then would need to have an agent/manager in-between the investment and any work that is carried out on the properties (to remain inside the unearned income definition).

[Suradit69]

If you pay somebody to act as the manager to fix any issues with the people who rent your house it should be ok.

If you fix the issues you are working and need a work permit.

Actually that is a good point that I had not considered - actually fixing stuff - then this becomes work - Hence then would need to have an agent/manager in-between the investment and any work that is carried out on the properties (to remain inside the unearned income definition).

The prohibition is against employment, whether there is an income or not, so collecting dividends produces income, but there's no employment involved. The idea is that they don't want you to take work away from a Thai even if you do volunteer work on a regular basis that a Thai might be paid to do.

So, as was suggested, if you hire someone to do any work that might be involved in upkeep, etc. there shouldn't be a problem just because you're collecting money from the property (assuming you've found some way to own income producing property in Thailand... a condo??)

There was an article in the Phuket Gazette with this quote from Yaowapa Pibulpol, chief of the Phuket Provincial Employment Office:

:

“Foreigners cannot perform any work – in the true sense of the word – without a work permit. And they may only perform the work listed in the work permit and only at the place of work listed in the permit.

“But that doesn’t mean they can’t cook their own meals, clean their own houses or tend to their own gardens. Of course they can, but as soon as they are hired or profit by doing any of these things, they are ‘working’,” she said.

“And any foreigners who want to build their own boats on their own time, using their own skills and experience, for their own personal use are not breaking the law. They can do this, but they cannot build a boat so they can sell it later on. That would be profiting from the work,” Ms Yaowapa added.

Not applying the law beyond its intended scope is also what makes it legal for foreigners to assist in public cleanup campaigns and other community projects – as long as the volunteer work is not regular, she added.

Edited February 13, 2014 by Suradit69

[spambot]

Great reply

Suradit69

Good insight!

I note your surprise at the Condo investment.

I'm currently looking at Condos along the Rayong coastline - They are increasingly looking like good value at around 2 million Baht for 30/35k monthly rentals or 2/2.5k per night - Currently the majority of renters are Scandinavian tourist that seem to have the demand for nightly and up to 3 month rental.

Having said that it's still not clear to me as of yet the fully optimum channels to get to this market or the strength of competition that is targeting the same customer. However they seem to be mostly medium sized businesses buying up to between 10 to 50 condos from developers who increasingly are new build projects that seem to be following in the footsteps of the Thai government investment program on its coastal area.

[bangkapi]

I have a retired friend who is "flying under the radar" earning income from 20+ small units near a local university.

He says it is much better than trying to get earnings from other more risky or low yielding "investments".

Thanks Bankapi - So does he a). just think he could be but not sure one way or the other - or does he know for certain (and realises that he has not been found yet)?

Its good to know that he has bought so many - But I suppose that this brings up other issues more demanding like tax on the earnings which will be more visible then to immigration (if was a problem area for his visa).

He is just doing as the Thais do... He has a retirement visa with 800K in the bank and nobody bothers him. The Thai government tax collectors do not bother Thais or anyone about income from renting out condos. They are not apartment buildings.

[Thai at Heart]

Thais rarely if ever declare income they derive from house rentals and the such.

So it's unlikely to attract any interest unless you make someone jealous.