Real Estate in Thailand: Purchase
Property, Bungalows, Villas, Houses & Land!
- Right & Law - |
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1
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Right
& Law
- Real Estate
& Property - |
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(House
with land - not offered anymore)
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Are you a natural or juristic person?
Under the Civil and Commercial Code of Thailand
a juristic person enjoys the same rights and is subject to
the same duties as a natural person. The Alien Business Operations
Acts and Section 97 of the Land Code provide that alien person
includes a juristic person with half of the shares constituting
its capital held by alien. Therefore, a company has the same
rights as a Thai Person.
Under Section 1144 of the Civil and Commercial Code, every
limited company shall be managed by a director or directors
under the control of the general meeting of shareholders and
according to the by-law of the Company.
Tax
Aspects
A company is liable to corporate tax only if it makes profit
from the business in any fiscal year. A dormant company will
not pay any tax but the returns and the balance sheet have
to be filed as usual, once annually for the balance sheet
and twice for tax returns.
There is no property tax
on your property
if you keep the property
for your own use and not for commercial purposes.
Mortgage
Foreigners are entitled to acquire mortgages in their favour
as collateral for financial support to Thais. There is no
period limit on such mortgage. Again, the mortgage fee is
1 % of the amount involved.
How to pay?
If you are purchasing property
in Thailand and you want to pay in Thai
Baht ensure that your funds are transferred into Thailand
in foreign currency and converted to Thai Baht here. The reason
for this is that the receiving bank will issue a "Thor
Tor 3" Certificate confirming the transaction. The relevance
of the "Thor Tor 3" Certificate is that it is one
of the documents you will need in the future if you wish to
repatriate funds without incurring tax penalties. Also, be
aware that Banks will only issue "Thor Tor 3" Certificates
for individual inward transfers exceeding 100,000 US.
Repatriation of investment funds and repayment of overseas
borrowing in foreign currency can be remitted freely upon
submission of supporting evidence. One of these documents
would be the "Thor Tor 3" mentioned above, or in
respect of a foreign currency loan, the loan contract. Remittance
of funds without proper documentation could be regarded as
income and become liable for tax. Most real estate agents
and property developers prefer to simplify the process by
allowing you to purchase your property in foreign currency.
Your money is usually transferred directly into one of their
offshore accounts. They will set up the freehold for you directly
on remittance of this money. When the time comes that you
wish to sell your property
you simply sell it on, in foreign currency.
Property Taxation
There are 2 different types of Tax levied on property
in Thailand and they are called:
1. Landtax
2. Structures Usage Tax
Landtax is very small tax levied on land ownership equivalent
to just a few Baht per Rai per year. This amount is so small
that the land office rarely bothers to collect it and if they
do may wait a few years before the amount is worth the effort
of collecting. In any commercial sense this tax can be largely
discounted.
Structures Usage Tax is applicable at the rate of 12.5 % on
the actual (or assessed) gross rental value of the property.
Land Title Deeds
True Land Title Deeds are officially called "Nor Sor
4 Jor" or more commonly "Chanote" and are issued
by the Provincial Land Office. Land held under Chanotes are
accurately surveyed and GPS plotted in relation to a national
survey grid and marked by unique "numbered" marker
posts set in the ground. |
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