Haris & Associates Phuket Thailand Legal Blog

 

The simplest and most safe means for a foreign investor to buy actual property property in Thailand is to buy a condominium unit freehold as a result of the minimal legal requirements which  you can see below.

Requirements

To be able to be eligible to buy a condominium freehold foreign buyers want solely to satisfy the next legal requirements:

– Proof to Enter Thailand legally; and

–  Proof that the funds used to buy the condominium had been remitted from abroad in foreign currency.

Without such proof, the Land Department won’t allow the transfer of possession of a condominium to a foreign purchaser.

Observe: Foreigners who’ve resident standing within the sense of the Thai Immigration Act solely(Blue Resident Guide) are exempted from the duty to remit international forex from abroad. Authorized residents are additionally allowed to purchase in baht and even to borrow cash with a Thai financial institution to finance their buy.

International Quota Requirement:

Moreover the full ratio of foreign possession in any condominium constructing is proscribed to 49% of the entire non-public space of any condominium constructing at anybody time.

Due to this fact previous to comply with buy right into a condominium constructing please verify with the juristic particular person or co-proprietor affiliation what’s the ratio of foreign possession there.

Foreign money transfer:

When transferring foreign forex from abroad, you need to comply with the next guidelines.

The international forex:

– should be of an quantity at the least equal to the buying worth of the condominium, or the condominium appraisal value; and

– remitted from abroad; and

– introduced into Thailand; and

– exchanged in Thailand; and

– both be from a checking account within the title of the international purchaser; or transferred to a checking account in Thailand within the title of the international purchaser.

When requesting your financial institution to provoke the transfer, have them add the next particulars to the a part of the wire transfer type reserved for remarks:

“as cost due on the acquisition worth of condominium unit no. [000] within the [000] Condominium”.

The variety of the unit and the identify of the condominium aren’t obligatory, however really useful.

Transfer requirements when buying in co-possession with a foreign partner

If you’re buying in co-possession with a international partner and the cash just isn’t despatched from a joint account within the names of each spouses, don’t forget to say that the transfer can be made on“behalf of the primary title and surname of the partner”.

Right here once more, this comment isn’t necessary, however beneficial.

Transfer requirement when buying in co-possession with a Thai particular person

If a international purchaser purchases a condominium in co-possession with a Thai particular person, resembling a Thai partner, and if the condominium unit title deed is to be transferred and registered to each co-house owners names, then the international purchaser will solely have to remit half of the acquisition value of the condominium in foreign forex.

The opposite half of the condominium value could also be paid in Thai baht, as a result of it’s the Thai purchaser’s contribution to the acquisition of the Thai share of co-possession.

Be aware: The Thai co-proprietor may apply for a mortgage with a Thai financial institution to finance the fee of his/her share of the condominium unit buy worth. On this case, nevertheless, the financial institution will need the mortgage to use to the entire condominium unit.

Foreign Exchange Transaction Form and Foreign Exchange Credit Advice

The foreign condominium purchaser must use foreign exchange Credit Advice Recommendation(s) issued by his/her financial institution  with the intention to show that he/she has transfered into Thailand the condominium buy cash in international foreign money.

If the transfered quantity is beneath to 20,000 USD the financial institution will situation the International Alternate Credit Advice Recommendation upon request of the international investor.

At any time when transfering international forex in an quantity superior to 20,000 USD or its equal the foreign investor could have first to file with the financial institution a type referred to as Foreign Exchange Transaction Form (“FETF”) earlier than to use for the foreign exchange credit advice recommendation.

Observe: Banks will maintain any transfers above the quantity of 20,000 USD till such time when the FETF has been filed. It’s only after the recipient of the transfer of greater than 20,000 USD has filed the FETF that the banks will trade the cash into Thai baht and Credit Advice it on the recipient account.

When you transfer the international foreign money immediately into the checking account of the developer or of a lawyer, the developer or the lawyer that can be dealing with these formalities in your behalf.

Observe: Don’t forget. In the event you transfer the cash to Thailand into a 3rd celebration account (developer or lawyer) the cash must be despatched from an account beneath your title so as so that you can be eligible to buy a condominium freehold. Don’t transfer funds immediately from a fund or an organization to the developer or the lawyer account. Have the cash transit by way of a private account.

For those who transfer the foreign foreign money into your private account in Thailand, you’ll have to deal with the of submitting the FETF your self. Watch out to do it upon every transfer and don’t wait till the final minute, as a result of banks want a median of 24 to forty eight hours to difficulty an FCEC.

Word: if you’re not in Thailand on the time when the transfer is executed in your Thai private account signal a FETF in clean and remit it to your lawyer. Otherwhise the cash transfered will likely be on maintain for so long as you aren’t in a position to fulfill this requirement.

These days, minimal quantities are not relevant and Thai banks will subject International Foreign money Credit Advice Advices for any quantity (together with small month-to-month installments of 500 or a thousand Euro) and cost a payment for this service of round THB 200 per certificates.

In case you lose your International Foreign money Credit Advice Recommendation or your FETF earlier than the transaction on the Land department, it’s possible you’ll request the financial institution re-difficulty a reproduction, so long as you continue to have the reference for the transaction. On the whole, the financial institution will request that you simply declare the lack of the FETF or of the International Forex Credit Advice Recommendation with the police first.

If the transfer passed off greater than two years in the past, some banks is not going to subject the certificates, however others will. This course of will take about 10 days and the financial institution would possibly cost you a surcharge for the service.

If you happen to lose your copy of the FETF or of the International Foreign money Credit Advice Recommendation after the transfer of the condominium on the Land department, you might go to the Land department anytime and request a duplicate of the FCEC that the Land department may have on file. Right here once more, you’ll be requested to pay a small authorities price for the service.

Issues you have to completely not do

The next have to be strictly averted when transferring your cash:

– Don’t alternate your foreign foreign money for Thai baht on the worldwide market, as a result of you’ll not qualify to buy a condominium freehold.

– Should you transfer on to the account of the developer in Thailand or via the account of a lawyer, don’t ship the cash from an account that’s not below your individual title (firm account, pension fund, and belief fund, and so forth.). Your identify merely should seem at one finish of the transaction or the opposite.

For more legal, business news & updates check out our blog. For legal concerns in Phuket, make sure to contact Haris & Associates.