Confusion as condo owners told they must have a work permit to rent out units

[blackcab]

What hoops do you have to skip through to get a work permit for renting out a condo, without having a Thai company?

What would the requirements be?

You could give the work permit application a try if you were hired by a Treaty of Amity company. That could work, but it's splitting hairs really.

If you want to know how to get a work permit without being employed by any company at all, I think the realistic answer is that it's not going to happen.

[Destiny1990]

Another issue for the condo owner is leasing their condo to someone on a cheaper 1 year lease, and that person then advertises it on websites for more lucrative short term rental prices, and keeps the difference in price - basically, subleases the property.

I know two guys doing this on Phuket. They just stay at each others place when either of them get a short

term rental.

How can the condo owner be responsible for this, especially when they are not even in Thailand?

is this a trick question lol

Owner will have a copy of the actual lease showing he is not liable for other peoples actions. Same if a murder is committed or the tenant burns down the whole condomium block, its hardly the landlords fault

So now they need laws against leasees - right?

More people to chase around. The owner owns the condo that is illegally being used as a hotel room by another party.

I doubt they will be able to enforce any of this.

Hello The unfoundated rumor says foreigner need workpermit for renting out long and or short term.so i not sure if you understand the financial implications?then if u do daily rental while it not allowed u be busted and reported before u know it as a foreigner.also u need report any new guest in ur room.dont try be smart.anyway if wp is required u best of to have you unit to rot away empty...good luck with you nominee constructions

[WishWashMan]

Im curious is that a work permit for renting under 30 days only ?

edit

Yes it appears this applies only to sub 30 days.

Makes sense to me, well done indeed

Yes, it's all a bit overly dramatic.

It is for people renting out their units on places like airbnb as generally using the unit as a holiday hotel/apartment, thus taking away customers from the real hotels and apartments. The Thai don't accept foreign foreign competition on their soil.

Unless you're illegally using your unit as a short-term holiday rental, you're fine.

hotels in los are so cheap. i cant see owners making money off air bnb. Hawaii doesnt have cheap hotels so i use airbnb a lot. Las Vega have cheap so airbnb dont make sense.

[bkkcanuck8]

Another issue for the condo owner is leasing their condo to someone on a cheaper 1 year lease, and that person then advertises it on websites for more lucrative short term rental prices, and keeps the difference in price - basically, subleases the property.

I know two guys doing this on Phuket. They just stay at each others place when either of them get a short term rental.

How can the condo owner be responsible for this, especially when they are not even in Thailand?

is this a trick question lol

Owner will have a copy of the actual lease showing he is not liable for other peoples actions. Same if a murder is committed or the tenant burns down the whole condomium block, its hardly the landlords fault

Also, every lease I have ever signed myself has a clause preventing subleasing without approval of the landlord.

Assume that the daily renting was happening, and it was either caught and they confronted the actual landlord. The landlord would show the long-term lease and point them in the direction of those leasing the property. At the same time they would change the locks and lock you out of the property and keep the damage and the deposit.

Or they authorities sting the lease and show up to get the keys pretending they are from Singapore or something and then arrest you directly as you hand the keys over.

You can try and play games -- but the authorities are not so dumb that they would not be able to find you if they wanted to.

[williamgeorgeallen]

you can get a work permit for this? i had a work permit for 9 years. jumping through hoops hiring staff i did not need and so on. would be hard to justify getting a work permit unless you had a substantial income.

[blackcab]

you can get a work permit for this? i had a work permit for 9 years. jumping through hoops hiring staff i did not need and so on. would be hard to justify getting a work permit unless you had a substantial income.

Yes. I have a work permit for exactly this.

[BrainLife]

EXCELLENT, has to be done 100% all in TH.

I will admit I only stayed 2x in an hotel in TH and was Bangkok for a few days (2-3 days as a fresh newbie 30 years ago)

Did not like Bangkok, but LOVED and still Love Pattaya.

Yes farang condo owners/renters, they make money so pay tax and get a work permit.

Now here comes the GOOD PART. TH requirements for a work permit are STUPID.

Need 2 million bath in the bank or investement AND 4 useless Thais employers to start with.

Therefore small farang condo owners/rentals are ,

AND like I many years wanted to do, start a small one man business and hire Thais as needed is impossible.

TH, you suck for farangs wanting to make some money and that MONEY will stay and be spent in TH.

TH, you suck even more for farang small starters (outside the bar/boom-boom scene). It is impossible to create a one man business and grow bigger in FY-TH

Edited July 9, 2016 by BrainLife

[gamini]

Im curious is that a work permit for renting under 30 days only ?

edit

Yes it appears this applies only to sub 30 days.

Makes sense to me, well done indeed

Yes, it's all a bit overly dramatic.

It is for people renting out their units on places like airbnb as generally using the unit as a holiday hotel/apartment, thus taking away customers from the real hotels and apartments. The Thai don't accept foreign foreign competition on their soil.

Unless you're illegally using your unit as a short-term holiday rental, you're fine.

Yep and its always been the law, nothing new except its being enforced so no surprises

and I would add that there is much the same laws in most countries.

[NamKangMan]

Another issue for the condo owner is leasing their condo to someone on a cheaper 1 year lease, and that person then advertises it on websites for more lucrative short term rental prices, and keeps the difference in price - basically, subleases the property.

I know two guys doing this on Phuket. They just stay at each others place when either of them get a short term rental.

How can the condo owner be responsible for this, especially when they are not even in Thailand?

is this a trick question lol

Owner will have a copy of the actual lease showing he is not liable for other peoples actions. Same if a murder is committed or the tenant burns down the whole condomium block, its hardly the landlords fault

Also, every lease I have ever signed myself has a clause preventing subleasing without approval of the landlord.

Assume that the daily renting was happening, and it was either caught and they confronted the actual landlord. The landlord would show the long-term lease and point them in the direction of those leasing the property. At the same time they would change the locks and lock you out of the property and keep the damage and the deposit.

Or they authorities sting the lease and show up to get the keys pretending they are from Singapore or something and then arrest you directly as you hand the keys over.

You can try and play games -- but the authorities are not so dumb that they would not be able to find you if they wanted to.

You are assuming the condo owner is on Phuket, or in Thailand. Many are out of the country.

You are also assuming the leasee remains on Phuket, and continues to come and go from the property, like the two guys I know doing ths. What's stopping the leasee from leaving Thailand and subleasing the property over the internet.

Will Interpol pursue these criminals? Will they be extradited back to Thailand?

I rent here. I would never consider buying property in Thailand. I'm not playing games. The Thai authorities need to move with the times, as many other countries have with Uber and AirBnB.

The authorities here are so scared of foreign property investors making a few quid here that they are prepared to sink the property market, which will take the construction industry and some of the tourism market down with it.

[thairookie]

everybody wants Thailand to modernise and rise above the 3rd world status

If you rent a property in the UK you have to register and pay taxes, some people do it for a living - it is their primary income and employment, why should it be any different in Thailand ?

In Thailand, you will pay taxes at the time when you sell the property.

[Destiny1990]

you can get a work permit for this? i had a work permit for 9 years. jumping through hoops hiring staff i did not need and so on. would be hard to justify getting a work permit unless you had a substantial income.

Yes. I have a work permit for exactly this.

Well congratulations u probable manage several units or appartments and yes then it makes sense having an WP but most foreigners have a single unit and then a workpermit is madness.but u is the exception and we proud with your achievements!!

[NamKangMan]

Another issue for the condo owner is leasing their condo to someone on a cheaper 1 year lease, and that person then advertises it on websites for more lucrative short term rental prices, and keeps the difference in price - basically, subleases the property.

I know two guys doing this on Phuket. They just stay at each others place when either of them get a short

term rental.

How can the condo owner be responsible for this, especially when they are not even in Thailand?

is this a trick question lol

Owner will have a copy of the actual lease showing he is not liable for other peoples actions. Same if a murder is committed or the tenant burns down the whole condomium block, its hardly the landlords fault

So now they need laws against leasees - right?

More people to chase around. The owner owns the condo that is illegally being used as a hotel room by another party.

I doubt they will be able to enforce any of this.

Hello The unfoundated rumor says foreigner need workpermit for renting out long and or short term.so i not sure if you understand the financial implications?then if u do daily rental while it not allowed u be busted and reported before u know it as a foreigner.also u need report any new guest in ur room.dont try be smart.anyway if wp is required u best of to have you unit to rot away empty...good luck with you nominee constructions

I rent here. I would never buy a property in Thailand. So, none of this is a problem for me.

Why would a condo owner, renting out his property over the internet, whilst in his home country, need a work permit?

What work has he done in Thailand?

[ozyjon]

So an investment property is a good investment in Thailand.

[Mudcrab]

I think it's safe to assume that this new law will not help to boost the sales of new condo units. Most condo owners who do not live there would like to rent out .

It is not a new Law. It has always been illegal to earn an income in Thailand and not be in possession of a work permit. They are just applying the law which has always been there. You cannot just do what you like here anymore and in my mind, that is fair enough. Just the same as they are coming down on Tourist Visas being used to live in the country on a full time basis. It's all coming to an end.

Only for the silly farangs who come here goggled eyed and buy a condo on their first visit.

Me and my (Thai) missus (yes I preferred to' buy' rather than rent) are doing quite nicely thank you very much.

[Mudcrab]

hey man, thai rak thai

thai owner off course does not have to do anything and in the least pay taxes on the rest

better ask on arrival to give your wallet & be on the next plane to your home country

too bad the other countries in the world don't have the balls to impose the same stupid laws on thai citizen... but that would be unconstitutional, rascism, unequal, ...

I must have missed something...where does the supposed regulations equate to unconstitutional , racist or unequal?

I believe it is about the hotel law. The fact that many foreigners are apparently in breach of the law is irrelevent

[Mudcrab]

So, a foreign Phuket condo owner is sitting in their house in the UK, Europe, America etc, and places their condo on AirBnB.

A tourists books the condo for 2 weeks, and forwards AirBnB payment.

AirBnB forward payment to the condo owner's foreign bank account, minus commission, and the foreign condo owner is "working" in Thailand and needs a work permit.

Thailand continues to embarrass itself on the world stage.

Cant see how he can control nightly rentals on Air BNB. You need to be there to welcome them , give them keys and help with tourist questions , these people are needy. I used to rent a place out in Bangkok monthly only and that was a pain the arse and I was in the country! No way he will be using Air BNB from OS. He would be looking for minimum 1 year rental and an agent to manage busted air con unit or fridge etc

From what I have read, many condo owners doing this use the services of the onsite property manager (Thai) to arrange handing over the keys and cleaning the room, and/or, an agent (Thai).

The property managers and agents have full knowledge of what is going on.

If so, bye bye foreign property investors.

What does that do to the value of properties on Phuket?

It makes them virtually worthless in a market that already had barely a pulse. Many foreigners who purchased condos, town houses or villas who no longer reside in them for any number of reasons really have no choice but to rent them out in order to re-coup the yearly payments and maintenance costs which can be quite substantial. This move to enforce the law will cripple the property market completely and the knock on affect is going to have a serious impact on Phuket. There are thousands of people employed by these places. If the hotels think this will increase their bookings I think they are sadly mistaken as the people choosing the alternates to hotels will not be booking their next holiday at a hotel in Phuket because their usual accommodation is not available. They were coming because those options were available! As fewer people come to Phuket so all the other services will suffer and begin to shut down thus not giving the place the vibe it once had. This will snowball and as each sucessive high season passes the effects of this will begin to show. I suspect Patong will see the biggest change from this. They have already lost half of Jung Ceylon, this is just another nail. What they should be doing is allowing condo owners to register and comply with safety etc and pay the necessary taxes etc. This would be the most sensible thing to do and everyone wins including the hotels but they won't think so until they realise shutting all these places down will actually be their undoing.

Or there will be a fire sale by foreigners to get rid of the under performing mortgages they have. The properties will still be there and most likely bought by shrewd investors and continue to be on the market at a lower rental price.

People will still come to Phuket regardless of the jaded views of the (too) long expat residents.

[Mudcrab]

When I came here I was interested in do as others have done to make a small income on my investment, luckily I had an astute accountant who said

1 Start a company ( done )

2 Put all purchases to rent out in said companies name ( done )

Although initially cost was high setting up things etc, every year audit and accountancy fees still net me a profit that is acceptable and I still have control over the properties.

Nowadays starting a company is a lot harder and more hoops to go through .

Taxes are paid as are all other fees, but I do not have the authorities looking over my shoulder, I am considered a good company . Do I have a work permit yes based on the company do I work no but costs are so low it dopes not matter.

many try to make money and not pay taxes or other fees or statutory costs, they are the ones now wondering , wherever you make money taxes or someone has to be paid if you don't you will eventually be caught.

I sincerely hope you did not buy land in your company name.

Land.... you could be in a lot of trouble in the not so distant future

[Ulic]

Just wondering how a company like New Nordic building in Pratumnak/Pattaya guaranteeing

a 10% return renting out the individually owned units on a owners behalf is going to get

around all the foreign owners needing work permits. Talking to a person who claims to be

in the know, Chinese nationals have flown in and bought whole floors of the development.

Not sure how the "guarantee" is backed. Maybe this ruling will be a way to back out of the

guarantee. I would understand needing a work permit to rent out other peoples units but

needing one to rent out your own unit is a head shaker. If everything becomes fully enforced

the Thai building economy is going to take a heck of a hit.

[Mudcrab]

OK...OK...We get it

Meantime, can you make the apartment available for short time Boom Boom Room???

Cheers

I can make the tray of my Isuzu available at the right price. Special promotion this month....free mattress...slightly stained

takes one back to ones childhood don't it?

[micmichd]

EXCELLENT, has to be done 100% all in TH.

I will admit I only stayed 2x in an hotel in TH and was Bangkok for a few days (2-3 days as a fresh newbie 30 years ago)

Did not like Bangkok, but LOVED and still Love Pattaya.

Yes farang condo owners/renters, they make money so pay tax and get a work permit.

Now here comes the GOOD PART. TH requirements for a work permit are STUPID.

Need 2 million bath in the bank or investement AND 4 useless Thais employers to start with.

Therefore small farang condo owners/rentals are ,

AND like I many years wanted to do, start a small one man business and hire Thais as needed is impossible.

TH, you suck for farangs wanting to make some money and that MONEY will stay and be spent in TH.

TH, you suck even more for farang small starters (outside the bar/boom-boom scene). It is impossible to create a one man business and grow bigger in FY-TH

Here you go Thai-bashing again. How did it come to your mind that Thai employers are useless? Thais are quite modern and usually up to date with their skills. And there's an emerging middle class in Thailand now with all chances for a better education, where education is considered a key for success in economy. Every other country in the West would do the same. Why shouldn't Thailand?

[Time Traveller]

Thaivisa should stop posting scare articles based on one letter by an unnamed member of one juristic committee in one condominium in one province.

Work permits are Not required to lease out their own property. This goes to the essence of property rights under the law.

Otherwise If it were true that foreign owners are required to have work permits before allowed to "generate income" on investments, then this would have widespread implications across all assets that foreigners owned in Thailand including even requiring foreigners with bank accounts earning interest to have work permits. Would that make sense?

Anyway, an anonymous letter with a comment from their anonymous lawyer discussion with the unnamed government official doesn't carry a lot of weight.

Thaivisa should know better than to be spreading rumors. Best stick to what they do best, articles about ladyboy pickpockets and news about the unremarkable foreigners in Thailand that no one has ever heard of and boring events that happen to them

Edited July 9, 2016 by Time Traveller

[Mudcrab]

I'd imagine that relatively few of the tourists who rent apartments or villas would want to stay in a thai hotel. I'd just holiday in Bali rather than Phuket. There's little to choose between the two places.

The biggest impact will be on property investor confidence. Condos were sold (certainly in Pattaya) on the back of holiday rental incomes. Take that away and you're left with nothing more than an empty slave box. I wonder how many of the slum villa type moo bans will suffer - many of these units are rented out by on site management companies. How many have hotel licences?

Imagination is a wonderful thing MonkeySee1 may you have many more years of it.

Edited July 9, 2016 by Mudcrab

[micmichd]

I have a condo I rent out periodicallly when I am overseas. Property agent manages rentals and this is huge business and a key selling point over many years in selling condos to foreign investors like myself by highlighting that point when selling.

I prefer monthly or more rental incomes anyway as is a hassle and cost more for cleaning etc. to prepare condo for next renter. Fact is many people don't want to stay in hotels and be ripped off and want the flexibility and affordability of condo living overseas.

I had a renter last year who originally planned 4 weeks but had to cut short stay and was only there for 3 weeks. Didn't charge full stay as he is a repeat customer so does that now mean I could be jailed for this? That's ridiculous.

There is legislation regarding income from rent and how that is classified - in general same as bank deposits or other investments in Thailand generating income. It is taxable of course if over a certain amount per annum.

Generally is in line with other countries where rental properties are not considered a business but investment income. But I understand that running condos as hotels is a business and hence would fall under appropriate regulatory requirements and I have no problem with that but I can see ambiguity and misinformation creeping in with naysayers blaming the whole foreign ownership rental market as a sin and to be banned etc. going against what all other developed nations allow.

I've only rented condos a couple of times many years ago. I found them to be more expensive and more hassle than a hotel room. I like it when someone else makes my bed and cleans up after me.

You're sure you can't make your bed yourself and clean up after you?

[Mudcrab]

We should be glad the authorities have finally taken some action against all these illegal's workers, just wait till they will step up a bit further their checks, because if a farang it's breathing the air that a thai could have, obviously that needs to be pointed out, and how the farang can keep breathing here, without exchanging money, by for example going to buy it's own dinner? We need a crackdown!

And as soon as the country will be freed by this plague, i really hope that they will go to do the same thing in the lands from where these fellongs comes from, let's get to the root of it fast, because if they are owning a home or doing a job abroad, that's something that a thai could do, so we all need to make sure the world adhere to the laws....

fellongs...I wonder if Naam caught that one!

Add it to his list of a hundred ways to spell foreigner in by foreigners in Thailand.

I wonder if Guinness book of records are aware?

[Mudcrab]

In my country(Turkey) we did sell thousands of the properties to the foreigners and most of the foreigners (except 2 or 3 countries) are allowed to own hundred percent of the property with a deed/

And the exception is the land more than 300.000 sqm/If it is more still you may own but the resolution of the board of the Ministers needed.

I love Thailand /have friends here and come at least twice a year but buying a property is not possible here

Thanks for the info...what country would that be?

[blackcab]

So here is what I believe to be true, based on my own experience:

1) You don't need a work permit to rent out your property if you are not in Thailand.

2) If you are inside Thailand you don't need a work permit to rent out your property through either a Thai person or a foreigner who holds the correct work permit, provided you do no work yourself other than signing the Agent's contract. By work I mean you do not advertise the property, receive money directly from guests or tenants, meet guests or tenants, hand over keys, fix problems, clean rooms, change the towels, etc.

If all you do is receive a passive income that is paid to you by an Agent I don't believe you need a work permit.

However, I am not saying that the short term rental (under 30 days) of a condo is lawful. On the contrary, I believe the short term rental of a condo by anyone, whether they are a Thai or a foreigner, is unlawful.

I believe this because a condominium building falls under the definition of a structure that requires a hotel license in order to offer rooms for short term rent (ie more than 4 rooms in aggregate and/or the simultaneous use of the property by more than 20 people, for periods of less than 30 days). As condo buildings tend not to be issued a hotel license, this is where the issue of unlawful use stems from.

So, for those owners who use an agent for rentals over 30 days, I think you will be fine.

For those owners who are using an agent who allows rentals of under 30 days, you are not in such a good position and are renting your condo in a building with no hotel license when such a license is required.

For those owners who undertake the type of work I discussed above, I believe you are working without a work permit, whether for rentals for more than 30 days or less than 30 days. In reality, however, you would not be issued a work permit to undertake work such as cleaning a room - instead you should be hiring a Thai person to do that work.

For owners who personally manage aspects of a short term condo rental themselves (such as meeting guests, handing over keys, fixing problems, or instructing others to do so whilst in Thailand), I think you are in the worst position by not having a work permit and renting your condo in contravention of the Hotel Act.

I'll be very clear about this: I am not a lawyer so this is not a legal opinion. Do not get yourself into a situation where your only defense is saying, "Well blackcab said..." while you try to desperately PM me from Thong Lor police station.

On the other hand, I speak from the position of holding one of the few work permits issued that actually allows me to transact business related to property. In a nutshell, I'm a foreigner and I can rent out condos. For anyone.

Part of my job description in my work permit (attached below) states that I can:

Act as an Agent to:

Buy, Sell, Sell with the Right of Redemption, Arrange a Rental Period or Lease for a Landlord or a Tenant, for:

any Land, House, Condominium or any other Construction whatsoever, and also for:

any other kind of asset fixed to the land including rivers, ponds, trees, minerals (and much more as the list of included items is quite long).

As I said, this isn't a legal opinion, but it does come from someone who has legitimate, in-country experience of this situation.

If anyone has any questions I'll do my best to help answer them if I can.

[losworld]

This is quite interesting and unfortunate for many foreign owners. So can a Thai rent out his place short term?

I think it is hte hoteliers under pressure from reduced visitors or losing the upper end customers as you can bet the Chinese are largely booking lower cost accomodations. They see AirBnB and think they are losign the business there but the room numbers are small.

Look at Pattaya all the unsold condo units being built are now being rented out like a hotel. I think this is a threat to the hotel owners.

I woud think this would hurt guys like dancewathers.com and the talay rentals as an example not to mention New Nordic saying they will guarantee two years rentals (which is actually built into the price) but good luck after two years.

See how it plays out.

[AloisAmrein]

One more Thai bullshit. One more reason NOT to buy property in Thailand. In every civilized country in the West you do NOT need a work permit to rent out a flat in a condominium, because it is considered as business, not as work. Thai "jurisdiction" again at its best, racial and xenophobic.

[Phuketboy]

I don't understand why or what the confusion is. If you earn money in Thailand, you are essentially operating a business and making money. Therefore, you must pay tax and hold a work permit. This has been the rules for as long as I can remember. It is not just Thailand, but the same in other countries. If you work in Australia or UK or earn money from a business etc you would legally have to pay tax and have the correct visa etc as well. The problem is that people jump into things without doing their homework.

[impulse]

The problem is that people jump into things without doing their homework.

Partially true, but don't forget the lack of full disclosure on the part of many people selling condo projects, and lack of consistent enforcement leading people to believe what they want to.

On an aside, I was doing some Googling on the subject and found info from samuiforsale website indicating there's a 12.5% tax on rental income, in addition to the income tax due on rental income above the income tax trigger level. They did say it's quite fine for a foreigner to rent out their freehold condo, but the name of the website leads me to believe they may have a bias... Still, a of of good info on leasehold vs freehold, formal vs informal condos, limitations on foreigners, etc.

Edited July 9, 2016 by impulse