30 Year Lease

[wallacern]

Sorry to bring up the lease issue again.

I had my wife talked into a 30 year lease and then she discussed it with her friend who works for the tax dept. in Pattaya. She says that my wife has to pay tax if she leases me the house.

Anybody with info on this angle?

Thanks,

Mike

[Mobi]

Sorry to bring up the lease issue again.

I had my wife talked into a 30 year lease and then she discussed it with her friend who works for the tax dept. in Pattaya. She says that my wife has to pay tax if she leases me the house.

Anybody with info on this angle?

Thanks,

Mike

I too would like some info on this. I will be seing a lawyer shortly so if he gives me any gen I will let you know.

One thing, if you have gone the company route, there are also annual charges and tax to pay, so either way there is a cost.

[SamSipEt]

Sorry to bring up the lease issue again.

I had my wife talked into a 30 year lease and then she discussed it with her friend who works for the tax dept. in Pattaya. She says that my wife has to pay tax if she leases me the house.

Anybody with info on this angle?

Thanks,

Mike

I too would like some info on this. I will be seing a lawyer shortly so if he gives me any gen I will let you know.

One thing, if you have gone the company route, there are also annual charges and tax to pay, so either way there is a cost.

The short answer is yes she (you?) will have to pay tax when the transfer is done at the land office. Forget how much but not vast. It was a small percentage of the value of the 30 year lease which on the advice of our lawyer was set at the same amount as the purchase price.

[monty]

The tax payable on the lease amounts to 1.1% on the full amount for the 30 years (1% tax, + 0.1% stamp duty)

If you would rent for 5000 B/month (60000/year, 1.8 million/30years) the tax would be 19800 Baht.

If it is a company which leases out this land, that income(1.8 million) has to show up in the balance sheets and that is where the biggest tax burden will come from.

When it is a private person, this income (even if it never has been actually paid) has to be included when declaring personal income.

The revenue department allows for a deductment of 15% of moneys received from leasing out land (more if it includes buildings).

Tax liability on this income alone would be roughly 290,000 Baht!

[LoveDaBlues]

So, if a Farang has purchased a piece of land in the GF name which route should he take? Can she give him (as an individual) a 30 year lease or must he first form a company? What is the most economical way to go? Confusing stuff.

[Buckwheat]

And while we are on the subject of 30 year leases, I was told last night that while the 30 year lease is solid in accordance with Thai law, the OPTION to renew at the end of the initial 30 years is not enforcable and 100% up to the "owner" of the land. So while it may say you have the option to renew in your initial contract, you might be sol at the end of 30 years.

Can anyone enlighten me?

[Kimera]

So, if a Farang has purchased a piece of land in the GF name which route should he take? Can she give him (as an individual) a 30 year lease or must he first form a company? What is the most economical way to go? Confusing stuff.

Well I will try !! If you purchase a house (with or for your Thai) the best option is to purchase the property in the Thais name and have a legal document drawn up signed by you the thai and witnesses that can be as complicated as you like, and filed with the land office as an addition to the sale and ownership. You can even swap (Her-- Him) You will have to seach in the Falang?english areas Phuket is the best but contact the lawyers there (thats what they do )

[Kimera]

So, if a Farang has purchased a piece of land in the GF name which route should he take? Can she give him (as an individual) a 30 year lease or must he first form a company? What is the most economical way to go? Confusing stuff.

Well I will try !! If you purchase a house (with or for your Thai) the best option is to purchase the property in the Thais name and have a legal document drawn up signed by you the thai and witnesses that can be as complicated as you like, and filed with the land office as an addition to the sale and ownership. You can even swap (Her-- Him) You will have to seach in the Falang?english areas Phuket is the best but contact the lawyers there (thats what they do )

Just to update, you will also add a will into the Doc. that when you die its your Thai's (Lock stock and smoking barrel)

[yorkman]

So, if a Farang has purchased a piece of land in the GF name which route should he take? Can she give him (as an individual) a 30 year lease or must he first form a company? What is the most economical way to go? Confusing stuff.

Well I will try !! If you purchase a house (with or for your Thai) the best option is to purchase the property in the Thais name and have a legal document drawn up signed by you the thai and witnesses that can be as complicated as you like, and filed with the land office as an addition to the sale and ownership. You can even swap (Her-- Him) You will have to seach in the Falang?english areas Phuket is the best but contact the lawyers there (thats what they do )

Just to update, you will also add a will into the Doc. that when you die its your Thai's (Lock stock and smoking barrel)

Sooooooo...why don't you do a "superficies" (ask a competant lawyer.......)

It's your to live there for the rest of your life (no 30 year rule), and your wife who is still the land owner gets it all after you die, will or no will.

It cost me 400B (fixed fee) at my local Amphur

I note however I am back to 3 posts (maybe the site owners who promote company formation, and profit from them, have deleted a few posts..who knows...... )

[wallacern]

Thanks for all the input. I will be trying to go the 30 year lease route

if I can talk the wife into it. She is getting stubborn in her old age and seems to think that I will leave Thailand if she dies before me.

Mike

[Khun Jean]

I saw the OP was speaking about a house. You should seperate the land and the house ownership first. The land goes into your wifes name and the house in yours. A good even split.

Your wife should then give you a 30 year lease for the land only. The price can be a lot lower because it is only the bare land. This helps to lower the tax that has to be paid.

Maybe you can lease her part of the house for 30 years and call it even.

(Small insurance for the extension after 30 years.)

Don't know anything about the "superficies", but i notice lawyers not really like it. It must be a good option then.

[Artamus]

Can anyone advise how they actually went about doing a 30 year lease with thier Thai wife? My wife and I have some land and now want to do a 30 year lease. I have heard that these 30 year leases can be done directly at the Land Office (at least that's what they told us when we bought the land), but I'm not sure I trust any money-grabbing Land Office official.

So would the first step be to get the leaae drawn up by a lawyer, followed by a visit to the land office to pay the 1.1% tax? Given how commonly 30 year leases are being done now, there must be some very standardised agreements, so setting this up should be fairly straightforward. (Does anyone have any examples or know where some might be found?)

What would this cost to do through a lawyer?

Thanks

[Artamus]

The tax payable on the lease amounts to 1.1% on the full amount for the 30 years (1% tax, + 0.1% stamp duty)

If you would rent for 5000 B/month (60000/year, 1.8 million/30years) the tax would be 19800 Baht.

If it is a company which leases out this land, that income(1.8 million) has to show up in the balance sheets and that is where the biggest tax burden will come from.

When it is a private person, this income (even if it never has been actually paid) has to be included when declaring personal income.

The revenue department allows for a deductment of 15% of moneys received from leasing out land (more if it includes buildings).

Tax liability on this income alone would be roughly 290,000 Baht!

Can you explain further on the private person item.

Taking the example above, let's assume you have a piece of land you pruchase with the wife for 1 Million Bhat. You create a 30 year lease and pay pay tax at 1.1% at the Land Office which gives you a bill of 11,000 Bhat. Are you saying that the Thai wife will also have an additional annual income tax liability of whatever the "yearly income" is of the rent. How is the "rent" calculated? Is there a minimum? I'm a bit confused on this.

[Pilchard]

So, if a Farang has purchased a piece of land in the GF name which route should he take? Can she give him (as an individual) a 30 year lease or must he first form a company? What is the most economical way to go? Confusing stuff.

Well I will try !! If you purchase a house (with or for your Thai) the best option is to purchase the property in the Thais name and have a legal document drawn up signed by you the thai and witnesses that can be as complicated as you like, and filed with the land office as an addition to the sale and ownership. You can even swap (Her-- Him) You will have to seach in the Falang?english areas Phuket is the best but contact the lawyers there (thats what they do )

Just to update, you will also add a will into the Doc. that when you die its your Thai's (Lock stock and smoking barrel)

Sooooooo...why don't you do a "superficies" (ask a competant lawyer.......)

It's your to live there for the rest of your life (no 30 year rule), and your wife who is still the land owner gets it all after you die, will or no will.

It cost me 400B (fixed fee) at my local Amphur

I note however I am back to 3 posts (maybe the site owners who promote company formation, and profit from them, have deleted a few posts..who knows...... )

Yorkman, Do you know the name of this type of agreement in Thai or is it the same.

I would like to get hold of a copy to get translated.

It sounds like this could be just what i'm looking for.

Are there any rules on min/max rent that is to be paid ?.

Any more info you have would be great, thanks

"superficies" Dictionary def

in Roman law, leases granted either for a long term or in perpetuity with most of the rights of full ownership, the only stipulation being that an annual rent be paid and certain improvements made to the property. Both originated in the early empire and were initially granted by the state, the former for agricultural purposes, the latter for building on land.