THAILAND

Document Sample
THAILAND Powered By Docstoc
					                                                                              THAILAND
 www.siam-legal.com


Guide to Buying Property in Thailand

Foreign Ownership

Restrictions pertaining to foreign ownership in Thailand depend on the type of property
which a foreigner wants to acquire. Below are the top real-estate investments in Thailand and
ways in which you can acquire ownership:

    1. LAND
       Foreigners are generally not allowed to own land in Thailand. But            there are
       alternatives through which a foreigner can own land.

            Through a Thai Limited Company - A foreigner can set up a Thai
            a.
            Limited company and buy land in the name of that company.
         b. Investment (BOI) - A foreigner, who invests 40 million Baht for no less
            than 5 years, is entitled to buy up to one rai (1,600 square meters) of land for
            residential purposes. Permission from the Ministry of Interior must be
            obtained.
         c. By marriage to a Thai - A foreigner with a Thai spouse can purchase land
            in Thailand but the land should be registered under a name of the Thai
            spouse. The foreign spouse also has to sign a declaration stating that the
            funds using to buy a land is of a Thai spouse, so that he/she waives his/her
            right to the ownership of land.
         d. Lease - A foreigner may acquire land in Thailand through leasing for the
            maximum duration of 30 years, with a possibility to renew again (for another
            30 years) if agreed. This is the least complicated option for a foreigner to have
            a right of usage of land. The land lease over 3 years must be registered at the
            Land Department.
         e. Structure Ownership - A company or the Thai spouse of a foreigner may
            grant a Right of Superficies in favor of the foreigner, giving him the right to
            personally own all constructions situated on the land. The Right of
            Superficies can be conceded for a period of 30 years and can be renewed for
            another 30 years (but not automatically).
    2. CONDO

         The condominium act of Thailand allows a foreigner to acquire up to, but not
         exceeding 49 percent of a total space of a condominium project. Moreover, the
         finance for the condo purchase should come from abroad and should be deposited in
         a Thai bank account.

    3. HOUSE AND VILLA

         Foreigners can only own a house and villa in Thailand through either a Thai Limited
         Company or under a Lease.

Titles

There are 4 categories of land titles in Thailand.

1. Freehold Title Deed- This type of title grants the holder of this document
   the full right over the land.
2. Nor Sor 3 Gor -A land awaiting a full title deed is granted the document Nor
   Sor 3 Kor.



     Bangkok: +66(0)2253 8100 Phuket: +66(0)76 326 322 Hua Hin: +66(0)32 526 286 Pattaya:
            +66(0)38370 786 Samui: +66(0)77 230 291 Chiang Mai: +66(0)53 807 070

                           www.siam-legal.com        info@siam-legal.com
                                                                                                    THAILAND
 www.siam-legal.com

3. Nor Sor 3 -Same as Nor Sor 3 Gor except that the land with Nor Sor 3 has
   never yet been measured by the Land Department; hence the land has no exact
   boundaries.
4. Possessory Right - A land with a possessory right has never been
   substantiated by Department, but is only recognized by tax payments at the
   Local Administrative Office.

Condominium units can be owned through either freehold or leasehold depending on
availability. If ratio of foreign ownership has reached 49%, then normally the units are sold
under a leasehold structure.

Conveyance

Your lawyer should be able to assist you in Title deed search, due diligence, review of sale and
purchase agreement and the transfer of property into your name.

Thailand Property Taxes

Transfer fee                   0.01% of the registered value of the property (normally 2%)

Stamp Duty                     0.5% of registered value. Only payable if exempt from specific business
                               tax

Withholding tax                1% of the appraised value of the property or market value whichever is
                               higher.

Specific Business tax          0.01% of the appraised value of the property or market value whichever is
                               higher if selling within 5 years (normally 3.3%)

Land and Usage Tax             12.5% of the assessed rental value of the property if property used to
                               generate rental income.

Lease Registration Fee         1.1% of the appraised rental value or market value of the property

Financing

Bangkok Bank and UOB in Singapore grant loan to help you finance your property purchase
in Thailand. It is possible to borrow up to 70% of the total purchase price of the property;
however, the normal rate is around 60%. The loan should also not exceed a period of 10 years.

International Home Loan Schemes

Around the middle of 2005, Thailand saw the emergence of a new financing service offered by
Bangkok Bank’s Singapore branch. At this time we saw Bangkok Bank starting to offer
offshore financing for foreigners wishing to purchase real estate in Thailand. Up to 70% of the
property’s value was made available to foreigners who did not qualify for a local loan.

New Development

You may purchase a property in Thailand under off-plan investment in a relatively low price
but be sure to enlist the service of a lawyer who will ensure that the following important
elements in the contract are considered: time frame, price, payment penalties, developers
default or a guarantee that your payment is fully refunded should the construction wouldn’t
be completed for some reasons, building floor plan and specifications, alternative dispute
resolution in the form of arbitration, among others.


  Disclaimer: This document is intended as a general guide only. Siam Legal and all its subsidiary companies and
  partners disclaim all liability from any damages caused by reliance on this document. Siam Legal strongly
  recommends seeking professional legal advice prior to any transaction.


     Bangkok: +66(0)2253 8100 Phuket: +66(0)76 326 322 Hua Hin: +66(0)32 526 286 Pattaya:
            +66(0)38370 786 Samui: +66(0)77 230 291 Chiang Mai: +66(0)53 807 070

                                 www.siam-legal.com             info@siam-legal.com

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:16
posted:11/29/2011
language:English
pages:2