Inheritance of a Condominium

[MWPMWP]

Hi

I have just found out that my uncle plans to leave me his Bangkok Apartment/Condominium to me in his will. I'm not sure if this has already been arranged or if it still needs to be done, but after hearing this I was a little concerned about the legality of the situation. I have been to Thailand a few times on holiday and know very little about Thai law, but I think I know enough to be concerned.

Is it even Legal for me to inherit this apartment unit as a non Thai (I'm English)? Also, If I can legaly inherit it, can I sell it? Do I need a Thai bank account to sell the property?

It will be a few years until this becomes important, but I only received this information recently. My uncle intends to live in the Condo for most of his retirement until he cant look after himself, but then he wants to move back to England for his remaining years.

I have asked my uncle about this but I struggle to get a straight answer from him so I suspect he isn't entirely sure how it works himself.

I would appreciate any information. Especially any first hand experience with inheritance law.

Thanks!

[1FinickyOne]

Planning to leave it in his will is not the same as actually making a Will and leaving it… You will need a lawyer involved. At this point, it just sounds like talk… And when it comes to health, how do you or anyone know when it will become important?

Even his plans to go back to England for the last few years - who knows when that will be? Sometimes the bus jumps the sidewalk, so to speak.

Sort of like the instructions - toast until burnt then 5 seconds less…

Since your Uncle seems to be lagging, maybe it would be in your best interest to offer to pay for the lawyer and get it done…

PS - leaving it in the Will would not prevent him from selling it and using the cash...

Edited December 23, 2015 by kenk24

[Jingthing]

There were some threads about this years ago.

My memory about that isn't great but I remember some surprising points.

Yes he can leave it to you in a THAILAND will.

Yes you can sell it.

But you basically will NEED to sell it, I think within one year of inheriting it.

The issue if you don't is how to take legal ownership of it.

Because it would be your Uncle and not you who IMPORTED the funds into Thailand, there is some wrinkle about the funds needing to be IMPORTED again, relating your name to it.

Yes, I know, that sounds totally insane.

I would be kinder if he sells it and leaves you the cash.

I know some people will say this is crap information, but that's my recollection.

I am interested in this topic as well. Maybe someone can update with a current reading of the legal situation.

[MWPMWP]

@kenk24: You are quite correct, but that wasn't really what I was asking. I might have worded it poorly.

I mean, for the sake of argument, lets assume the will has been written (In Thai with a Thai Lawyer), and lets assume he died yesterday. Can I legaly inherit it as a Non Thai? are there any quirks in Thai law that could be troublesome for me?

Edited December 23, 2015 by MWPMWP

[Jingthing]

Yes, you can definitely legally inherit as a non-Thai.

But that doesn't mean you can actually live in it.

It needs to be in THAI will. Not a foreign will. And he should get a copy of your PASSPORT as part of the will.

Edited December 23, 2015 by Jingthing

[MWPMWP]

Yes you can sell it.

But you basically will NEED to sell it, I think within one year of inheriting it.

The issue if you don't is how to take legal ownership of it.

Because it would be your Uncle and not you who IMPORTED the funds into Thailand, there is some wrinkle about the funds needing to be IMPORTED again, relating your name to it.

Yes, I know, that sounds totally insane.

Yes, you can definitely legally inherit as a non-Thai.

But that doesn't mean you can actually live in it.

Ok, this is why I started the thread. It all sounds like one big headache.

[KittenKong]

There were some threads about this years ago.

My memory about that isn't great but I remember some surprising points.

Yes he can leave it to you in a THAILAND will.

Yes you can sell it.

But you basically will NEED to sell it, I think within one year of inheriting it.

The issue if you don't is how to take legal ownership of it.

Because it would be your Uncle and not you who IMPORTED the funds into Thailand, there is some wrinkle about the funds needing to be IMPORTED again, relating your name to it.

Yes, I know, that sounds totally insane.

I would be kinder if he sells it and leaves you the cash.

I know some people will say this is crap information, but that's my recollection.

I am interested in this topic as well. Maybe someone can update with a current reading of the legal situation.

If a farang inherits a house/land (perhaps from a Thai spouse) he/she has a year to dispose of it as he cannot legally own it in his own name. The same does not apply to condos as these can be legally owned, unless the deceased was Thai and the 49/51 ratio is full in the building. So in a normal farang=>farang inheritance there should be no requirement at all for the condo to be sold.

However as far as I know you are correct about the FET form for the import of cash being required to update the ownership record. The obvious answer to that (assuming that the inheritor actually wants to keep the condo) is to import the money then export it again once the records are updated.

A somewhat ridiculous situation, as one might expect here.

Full transfer taxes will need to paid at the land office also.

[1FinickyOne]

Yes - it is a headache and as Jing mentioned - cash is nicer… even w/o complications it can take over a year in USA for a Will to go through probate…

[akentryan]

You will have to pay income tax on the inheritance in any event. My wife died and I inherited two-thirds of the value of our house which was set at 3.6 million baht. The inheritance tax on 2.4 million was 112,000 baht. Condos here can run from 700,000 baht up into the millions - hopefully your uncle's condo is enough to make it worth the effort.

Edited December 24, 2015 by akentryan

[bazza40]

You would be much better off persuading your uncle to sell the condo before he moves back to England. He may even be able to sell it and have a long term lease on it afterwards.

The English landlord of the apartment I am renting had a Chinese wife who left him the unit when she died four years ago. He's been trying to sell it for three years.

[peterb17]

You really need to consult a lawyer- there are some decent ones about. It gets quite complicated with court appearances of executors .

I would chat to your Uncle- if he plans to return to the UK in his twilight years and requires care- my Dad's nursing home cost £1400 a week! Quite frankly better to stay here and employ staff.

[Delight]

A foreigner can 100% own a condo(freehold) if the condo is allocated in the 49% living area available to foreigners.

Alternatively a foreigner can set up a company which he/she can partly own (again up to 49%).

Albeit the foreigner can only own 49% of a Thai company it can be arranged that the foreigner has 100% of the voting rights. It is this arrangement which allows foreigners to buy into the 51% of the condo living area allocated to Thais. This arrangement is very common . The company has to be audited every 12 months. Typically for a 12,000 Baht fee

After the death of your relative , a Thai court official will verify your right to inherit-subject to the detail in the Will. A Will is a must.

.If you inherit , and wish to keep,a freehold condo then you will have to bring into Thailand funds equivalent to the appraised value of the condo . The appraisal is carried out by the land office. The amount is generally less than the market value.

The act of bringing in these funds allows your bank to issue a Foreign Exchange Transaction Certificate (FET) . The land office will need this FET before they will issue a Condominium Title Deed (relating to the condo in question ) in your name . The funds can ,if required ,be transferred back to source after the FET has been issued

Once you own the condo –then you are legally obliged to pay the condo maintenance fees allocated to your condo.

Should you choose not to go down the FET route then you have 12 months to sell the condo after the court official has determined that you are the legal benefactor.

The Land office will step in if you fail to sell within the 12 months.

I believe that they will then sell the condo on your behalf (presumably at any price ) for a fee.

Of course your relative could set up a Thai company now and transfer the condo from foreign ownership to Thai company ownership.

If he were to do that and put your name as the managing director then all the foregoing (except the maintenance fees ) would be irrelevant. No Will required.

Also with this approach you in turn can bequeath for a very low transaction cost.

This approach will suit those who take a long term view

The downside to this approach are the transfer fees . Potentially up to 6% of the appraised value.

[Henryford]

Wouldn't it be better if your Uncle sold you the condo for a nominal fee (1 baht?). Then when he dies there is no question of you inheriting it, it is yours already.

[Delight]

Wouldn't it be better if your Uncle sold you the condo for a nominal fee (1 baht?). Then when he dies there is no question of you inheriting it, it is yours already.

He would still have to obtain a FET

[LukKrueng]

Yes - it is a headache and as Jing mentioned - cash is nicer… even w/o complications it can take over a year in USA for a Will to go through probate…

You keep reading the OP wrong. It's not about the inheritance, It's about being able to own the condo. And it's a condo in THAILAND, not the US of A, so what's that got to do with anything?????

[LukKrueng]

OP - seems you get a lot of advice regarding the inheritance instead of the ownership, and some of the ownership advise seems to be more confusing than helping.

Here's the deal:

A foreigner CAN own a condo unit as long as at least 51% of the units in the building belong to Thais. This is sometimes referred to as foreign ownership quota. So if your uncle is the owner of the unit, this unit is IN the foreign quota and can be sold / passed to another foreigner.

When you BUY a condo, there is a demand to show the money has been transferred from out of Thailand. I am pretty sure that is NOT the case for an inherited condo. As for ownership transfer fees - I think that also does NOT apply for inheritance,and I doubt anyone on this forum has actually inherited a condo and can tell you about these facts first hand.

Same goes for the transferring of the money out of Thailand in case of selling it - I am pretty sure that there is a legal way to do it as it is an inheritance money.

Anyway, you are talking about something that might or might not happen sometime in the future (and for your uncle's sake I hope it will be distance future rather than near...). Many things might happen between now and the time he can't take care of himself so why busy yourself with this issue and "kill" your uncle??

The simple fact and direct answer to your question - you can inherit and can own a condo in Thailand.

Wishes of all the best to you and your uncle.

[bangkapi]

With a valid will and a good lawyer and a death certificate and a 10 baht stamp fee at the land office, it is a piece of cake.

[MWPMWP]

When you BUY a condo, there is a demand to show the money has been transferred from out of Thailand. I am pretty sure that is NOT the case for an inherited condo. As for ownership transfer fees - I think that also does NOT apply for inheritance

This is nice to hear, and would certainly be more logical. Expecting someone who inherited a condo to import all the money into the country AGAIN, seems mental. However nothing would surprise me when it comes to Thai law. The Condo Unit is one in over one hundred units I think so the 49% ownership thing isn't really a concern.

This thread has been helpful in so much as It's given me a good list of questions to ask my uncle (and consult with a Thai lawyer).

Thanks guys.

[KittenKong]

Of course your relative could set up a Thai company now and transfer the condo from foreign ownership to Thai company ownership.

If he were to do that and put your name as the managing director then all the foregoing (except the maintenance fees ) would be irrelevant. No Will required.

Also with this approach you in turn can bequeath for a very low transaction cost.

This approach will suit those who take a long term view

The downside to this approach are the transfer fees . Potentially up to 6% of the appraised value.

Those transaction fees will be payable regardless. Either now or later.

There could also be a significant capital loss involved in removing the unit from the farang quota, not to mention future problems with tax and eventually selling it.

I think it's a very bad idea.

Edited December 24, 2015 by KittenKong

[KittenKong]

When you BUY a condo, there is a demand to show the money has been transferred from out of Thailand. I am pretty sure that is NOT the case for an inherited condo. As for ownership transfer fees - I think that also does NOT apply for inheritance

This is nice to hear, and would certainly be more logical. Expecting someone who inherited a condo to import all the money into the country AGAIN, seems mental. However nothing would surprise me when it comes to Thai law.

Mental or not, I think you will find that it is indeed the case as I mentioned.

The Condo Unit is one in over one hundred units I think so the 49% ownership thing isn't really a concern.

Bad assumption. The only thing that matters is how popular the building is with foreigners. Any popular building in a tourist area is more or less guaranteed to be up to the 49/51 limit (or even beyond it in badly-run buildings). The size if the building is not relevant.

What makes it not a concern is that if your farang Uncle is leaving a condo to his farang nephew then the condo will simply stay in the farang quota.

[KittenKong]

When you BUY a condo, there is a demand to show the money has been transferred from out of Thailand. I am pretty sure that is NOT the case for an inherited condo. As for ownership transfer fees - I think that also does NOT apply for inheritance,and I doubt anyone on this forum has actually inherited a condo and can tell you about these facts first hand.

I think you are wrong on both counts.

[KittenKong]

Wouldn't it be better if your Uncle sold you the condo for a nominal fee (1 baht?). Then when he dies there is no question of you inheriting it, it is yours already.

Taxes are due on the appraised value of the unit (or the real value, whichever is greater). The FET form must also be to the appraised value or the real value of the unit, whichever is greater.

[CWMcMurray]

Or another idea... Don't worry about selling it..

Contact a management company and just rent it out... And collect the rent

[Delight]

Of course your relative could set up a Thai company now and transfer the condo from foreign ownership to Thai company ownership.

If he were to do that and put your name as the managing director then all the foregoing (except the maintenance fees ) would be irrelevant. No Will required.

Also with this approach you in turn can bequeath for a very low transaction cost.

This approach will suit those who take a long term view

The downside to this approach are the transfer fees . Potentially up to 6% of the appraised value.

Those transaction fees will be payable regardless. Either now or later.

There could also be a significant capital loss involved in removing the unit from the farang quota, not to mention future problems with tax and eventually selling it.

I think it's a very bad idea.

Putting the condo into a Thai company is a very good idea if the plan is to bequeath the condo from generation to generation to generation.

Transfer fees are only paid once, i.e. the initial transfer to the Thai company and I am informed that the cost to change the names of the managing directors is less than 10,000 Baht.

No need for FET's

In such circumstances the selling price of the condo is irrelevant.

[sparkey]

.

Edited December 24, 2015 by sparkey

[PattayaPhom]

Although the need to show funds from abroad to transfer the inheritance, FETs can be purchased for 1% of condo value without the need to actually bring funds to Thailand.

[Langsuan Man]

Although the need to show funds from abroad to transfer the inheritance, FETs can be purchased for 1% of condo value without the need to actually bring funds to Thailand.

Legitimate or through one of those shady exchange offices ?

[KittenKong]

Although the need to show funds from abroad to transfer the inheritance, FETs can be purchased for 1% of condo value without the need to actually bring funds to Thailand.

Legitimate or through one of those shady exchange offices ?

I think many bank managers will arrange this, and their rubber stamp makes it "legitimate". But I would expect the fee to be 2% or more.

[Delight]

Although the need to show funds from abroad to transfer the inheritance, FETs can be purchased for 1% of condo value without the need to actually bring funds to Thailand.

Legitimate or through one of those shady exchange offices ?

I think many bank managers will arrange this, and their rubber stamp makes it "legitimate". But I would expect the fee to be 2% or more.

Is this practice supported by the Government?

[Langsuan Man]

Not to be cute, but if you are asking about the current government then it would be the "norm" but not necessarily "supported" legally

If the bank manager gives you a receipt then that would be my criteria for "supported" by the government

Edited December 25, 2015 by Langsuan Man