Investing 40 M For Land And House - Question

[churchill]

I have see talk of being able to buy up to 1 Rai for 40 million or more ? for land and house - I assume - and being able to own the land and house freehold . Is this correct ? and if so how does one go about it . Is it linked to the Elite card or something seperate ?

Thanks

[bendix]

Yes, it's possible to own up to a rai of land for residential purposes subject to approval of the Ministry of the Interior and Ministerial regulations. And, yes, it involves a significant investment.

It is nothing to do with the Elite Card.

Talk to a reputable lawyer.

[GuestHouse]

If you are seriously thinking of investing that kind of money in order to own land in Thailand I would start by looking at what that kind of money would give you in returns on the international market.

You might be very much better advised to invest your 40million off shore and use the income to support your life in Thailand.

There are other options for holding land in Thailand, Lease and Usufruct being two very good options for Foreigners and they don't limit you to 1 Rai.

If like most of us you go ahead and develop your 1 Rai with a house, say costing Bht5million your investment in Thailand climbs to nearer Bht50million

That's 40 for your investment, 5 for your development and perhaps another 5 for the land you buy.

I'm assuming that if you have that kind of money you're looking for a nice plot in a nice neighbourhood, not the cheapest plot going regardless of location.

40 million is a hel_l of a lot of money to bring to Thailand in order to have the 'privilage' of investing a further 10 million.

[RAZZELL]

If you are seriously thinking of investing that kind of money in order to own land in Thailand I would start by looking at what that kind of money would give you in returns on the international market.

You might be very much better advised to invest your 40million off shore and use the income to support your life in Thailand.

There are other options for holding land in Thailand, Lease and Usufruct being two very good options for Foreigners and they don't limit you to 1 Rai.

If like most of us you go ahead and develop your 1 Rai with a house, say costing Bht5million your investment in Thailand climbs to nearer Bht50million

That's 40 for your investment, 5 for your development and perhaps another 5 for the land you buy.

I'm assuming that if you have that kind of money you're looking for a nice plot in a nice neighbourhood, not the cheapest plot going regardless of location.

40 million is a hel_l of a lot of money to bring to Thailand in order to have the 'privilage' of investing a further 10 million.

Another good post GH...

To the OP...are you nuts?

[churchill]

No Actually I have land and house to sell , around 40 Million and wanted to know the situation for potential buyers .

Thanks for your answers !

[Nadia 2]

THE LAND CODE AMENDMENT ACT (NO.8)

B.E. 2542 (1999)

--------------

BHUMIBOL ADULYADEJ REX.

Given on the 10 th of May, B.E. 2542

Being the 54 th year of the Present Reign

His Majesty King Bhumibol Adulyadej has been graciously pleased to proclaim that

Whereas it is expedient to amend the Land Code;

BE IT THEREFORE BY THE KING, by and with the advice and consent of the National Assembly, as follows:

Section 1 This Act shall be called the “Land Code Amendment Act (No. 8) B.E. 2542 (1999)”

Section 2 This Act shall come into force as from the day following the date of its plublication in the Government Gazette.

Section 3 The following statement inclusively as Section 96 bis and Section 96 tri in Chapter8 “Limitation of Right in Land of Alien ” of the Land Code.

Section 96 bis The provisions of an alien who may acquire land by virtue of the provision of a treaty under Section 86 paragraph one shall not apply to alien who bring money to invest as amount specified in the Ministerial Regulation which not less than forty million baht. Thus, an alien shall aquire the land for residence not more than one rai and shall obtain permission from the Minister.

The acquisition of land of an alien in paragraph one shall be in accordance with the rules, procedures and conditions prescribed in the Ministerial Regulation in which shall contain at least the following essential matters:

(1) The type of business invested by an alien shall be benificial to the economic and social of the country or shall be eligible to obtain the promotion of invesment pursuant to the Invesment Promotion Law as declared by the Board of Invesment.

(2) The invesment period needs to be maintained not less than three years.

(3) The location of land permitted for acquisition shall not beyond the confines of Bangkok , Pattaya, Municipality of land specified for residence purpose provided by the law of Town and Country Planning.

Section 96 tri As alien who obtained permission to acquire land under Section 96 bis and does not comply with the rule or conditions prescribed in the Ministerial Regulation Section 96 bis paragraph two shall have to dispose of the land owned by him within the period of not less than one hundred and eighty days and not more than one year as specified by the Director General. The Director General shall have the power to dispose of such land when the time limit elapes.

An alien who obtained permission to acquire land under Section 96 bis and does not use it for residence within two years from the date of acquisition registration, the Director General shall have the power to dispose of such land.

Countersiged by

Chuan Leekphai

Prime Minister

Remark: Reason for promulgation of this Act are as follows:

Whereas it is expedient to grant an alien, who bring money to invest in the significant business and bring the benefit to the country's social and economic development, that he/she may acquire land for residential purpose to the amount as specified in the law. This aims at facilitating and providing an alien, who enter into the Kingdom for business purpose, with a promotion factor for invesment decision making. This is also to increase the buying power for the business of immovable property being from the economic downtown, as well as to revive the country's overall economy. It is therefore expedient to revise the same to make them more suitable.

(Published in the Government Gazaette Vol. 116 No. 39 Kor dated May 18 th ,B.E. 2542 (1999))

[GuestHouse]

No Actually I have land and house to sell , around 40 Million and wanted to know the situation for potential buyers .

So on the assumption that your land and house is 1Rai or less, your foreign buyer would, if he were to use the investment route be briging in Bht 80million.

Makes even less sense.

[Firefan]

Wouldn't the house/land costs be considered PART of the 40 M needed?

WHat is also interesting is that if one sends in 40 M, buys land/house in own name(let's say for other money), then one can send the 40 M Baht out again after 3 years. I see a potential loan business here!

Cheers!

[Naam]

Wouldn't the house/land costs be considered PART of the 40 M needed?

WHat is also interesting is that if one sends in 40 M, buys land/house in own name(let's say for other money), then one can send the 40 M Baht out again after 3 years. I see a potential loan business here!

Cheers!

unfortunately the answer is a clear "NO!"

[quiksilva]

No Actually I have land and house to sell , around 40 Million and wanted to know the situation for potential buyers .

So on the assumption that your land and house is 1Rai or less, your foreign buyer would, if he were to use the investment route be briging in Bht 80million.

Makes even less sense.

THB 40M must be invested in Government bonds for 5 years, excluding the value of the land.

This will entitle you to own land up to 1 Rai, of whatever value that might be.

Two seperate transactions, the first however is needed to attain entitlement for the second.

Its such a cumbersome right that it is rarely used in practice.

[Naam]

"THB 40M must be invested in Government bonds for 5 years, excluding the value of the land."

*****

= incorrect information! the 40mm have to be invested in industrial ventures approved by the relevant ministry. i enquired two years ago what ventures would be eligible and the result was

[quiksilva]

Did the amount invested include the value of land to be acquired or was it as I described?

I'll see if I can dig up my source to confirm the information I posted. In the meantime, I'll sit corrected.

Edited November 3, 2006 by quiksilva

[Naam]

Did the amount invested include the value of land to be acquired or was it as I described?

it did not and neither is your description correct. no such thing like investing in rather liquid government bonds to obtain permission to buy 1 rai of land. initially i too fell for that information received by a real estate agent. then i did some homework or rather had it done by a reputed lawyer in Bangkok which turned out that there are various ways but all much too expensive PLUS a fancy income tax burden AND problems to repatriate the money.

if it was just government bonds which can be sold by snapping fingers after the blocking period i would perhaps have fallen for it. but that is unfortunately not the case.

[dannyb]

Actually the 40mil baht doesn't need to only be bonds. It could be stocks, mutual funds, cd, money market, etc. It just need to be in Baht. Note that it didn't say anything about length of time the funds need to be in Thai.

The asset class should applies for land it self, but of course you need to get aprooval first. So you'll probably need to cash into more liquid CD or money market.

for foreigner you probably should rent first - than if you really think you can retire than buy.

[Naam]

"Actually the 40mil baht doesn't need to only be bonds. It could be stocks, mutual funds, cd, money market, etc. It just need to be in Baht."

*****

sorry Danny, but this is NOT correct. you can only invest in businesses and industries approved by "The Board of Investment of Thailand (BOI)".

[Naam]

"This is available in three forms. Freehold of property by foreigners (individual investors) anywhere in the Kingdom requires Baht 40 million (currently about US $880,000) to be brought into Thailand. Provides the right for a foreigner to own up to 1 rai (0.25 acres) of land for a private residence only."

http://www.first-choice-properties.com/sam...ate_q_and_a.php

******

RUBBISH like this is spread by real estate agents to dupe foreigners. they don't even know how to convert areas as 1 rai is ~0.398 acres and not 0.25 acres.

in the meantime it takes ~1.1million us-dollars to acquire 40 million baht.

[dannyb]

"Actually the 40mil baht doesn't need to only be bonds. It could be stocks, mutual funds, cd, money market, etc. It just need to be in Baht."

*****

sorry Danny, but this is NOT correct. you can only invest in businesses and industries approved by "The Board of Investment of Thailand (BOI)".

Yes your right I did misread according to DOL website http://www.dol.go.th/guide/foreigner2_eng_ver_032545.htm

They seem to approved bonds, and property mutual funds, or mutual funds approved by Stock Exchange. no cds or money market. That does makes it less attractive as mutual funds do fluctuate

[Naam]

"They seem to approved bonds, and property mutual funds, or mutual funds approved by Stock Exchange"

*****

Danny,

believe me i went through the list of "approved" assets i was provided trying to find something that would yield net after expenses and taxes at least the average interest of a cash deposit. but nothing doing. one third of any given yield goes already for income tax and it was not at all clearly spelled out whether and in what way one is allowed to take the money out of the country again. that's why i settled VERY reluctantly on a thai company that holds the property, i pay a fair rent and the company pays corporate tax on this income.

needless to say that i don't feel secure, especially after the problems which were recently created but seem to have subsided now. i'm not a poor man but losing my investment on immobile property to whoever might be able to confiscate it would be quite a kick in my butt.

[dannyb]

"They seem to approved bonds, and property mutual funds, or mutual funds approved by Stock Exchange"

*****

Danny,

believe me i went through the list of "approved" assets i was provided trying to find something that would yield net after expenses and taxes at least the average interest of a cash deposit. but nothing doing. one third of any given yield goes already for income tax and it was not at all clearly spelled out whether and in what way one is allowed to take the money out of the country again. that's why i settled VERY reluctantly on a thai company that holds the property, i pay a fair rent and the company pays corporate tax on this income.

needless to say that i don't feel secure, especially after the problems which were recently created but seem to have subsided now. i'm not a poor man but losing my investment on immobile property to whoever might be able to confiscate it would be quite a kick in my butt.

Income tax you'll probably have to pay regardless of where the money is. The likelyhood is the tax rate is lower in Thailand than in west. I wouldn't worry too much about goverment taking your land away - such risk happen here as well. But if your worried about this, buy property in gated neighborhood and your probably be fine.

I have taken money out it abit painful as you have to do alot of paper work, and you'll probably loose some funds through currency exchange.

[Naam]

"But if your worried about this, buy property in gated neighborhood and your probably be fine."

*****

what difference does that make? my land and home is located in one of the local top gated communities but thai property law does not stop at the gate to ask for permission to enter.

[Naam]

"Income tax you'll probably have to pay regardless of where the money is."

*****

fortunately that is not the case. all income from my investment offshore is completely exempted from thai income tax. i am only liable to pay income tax on the portion i am bringing into Thailand (that's what the law says). contacting different lawyers and tax solicitors the answer was "sshhhhh...! are you crazy to wake sleeping dogs? you don't pay anything!"

addendum: not being taxed on my worldwide income (as was the case before) was the major reason to settle down in Thailand where all my expenses (and much more) are paid for by the savings on income tax.

Edited November 5, 2006 by Dr. Naam

[dannyb]

"But if your worried about this, buy property in gated neighborhood and your probably be fine."

*****

what difference does that make? my land and home is located in one of the local top gated communities but thai property law does not stop at the gate to ask for permission to enter.

My point is that applies here in the U.S. if it for the greater good of the community than taking the land is justifiable. My guess is probably anywhere in the world.

[dannyb]

"Income tax you'll probably have to pay regardless of where the money is."

*****

fortunately that is not the case. all income from my investment offshore is completely exempted from thai income tax. i am only liable to pay income tax on the portion i am bringing into Thailand (that's what the law says). contacting different lawyers and tax solicitors the answer was "sshhhhh...! are you crazy to wake sleeping dogs? you don't pay anything!"

addendum: not being taxed on my worldwide income (as was the case before) was the major reason to settle down in Thailand where all my expenses (and much more) are paid for by the savings on income tax.

That's is interesting so by being in Thailand your only paying taxes for investment you have in Thailand. What about earning recieved from say US wouldn't you need to file tax to the US govermenet.

* ps i am using US substitue it whereever you from are in the world.

[Naam]

"That's is interesting so by being in Thailand your only paying taxes for investment you have in Thailand. What about earning recieved from say US wouldn't you need to file tax to the US govermenet.

* ps i am using US substitue it whereever you from are in the world."

*****

thai tax laws specifically excludes all income and/or capital gains taxes on investment outside Thailand. the part what taxes have to be paid on the amount a retiree like me brings into the country is not clearly specified and the opinions vary. well... actually only MY opinion varies from the others. obviously nobody resident here on a retiree visa is paying any income tax and it seems nobody is asked to pay.

i was for quite some years a "U.S. Person" living in the USA on a tourist visa (german citizen) but liable to pay income tax to the IRS as i spent more than 182 days in the US. that's what the law says but i had a hard time to convince the IRS to accept my tax dollars.

whatever investment i have now in the U.S. is not taxed except for dividends on shares of US-companies (which i don't own). any bonds of US-corporates or other US-investment is tax free for me. the same goes for any investment i hold in Germany (or anywhere else on this planet). in short: i don't pay ANY income tax as i am a resident of Thailand.

[quiksilva]

they don't even know how to convert areas as 1 rai is ~0.398 acres and not 0.25 acres.

Seeing as you were so pedantic when responding to my posts, the actual conversion ratio from Rai to Acres is 0.3953686

But sillyness aside Dr Naam, thank you. Its always useful to hear from people who have been through the process and applied themselves. Experience trumps theory everytime.