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Ownership Forms for Foreigners in Phuket

Phuket, Thailand
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Ownership Forms for Foreigners in Phuket




If you are looking for real estate in Phuket and you choose an option to buy - a house or an apartment in Phuket, we recommend to learn about the forms of ownership of real estate in Thailand. Of course, all depends on personal preferences and habits. Someone feels more comfortable in an apartment building, while someone needs a closed area and appreciates the silence. At the stage of selecting an object it is also important to take into account such a factor as the form of ownership. The form of ownership determines the process of registration of a purchase and sale transaction, as well as the size of one-time taxes and annual fees.




Freehold



The simplest and most familiar form for us is an unconditional form of ownership or freehold, which means that you as a full owner are free to do everything with your property. The right establishing document is a document called Chanot, which is issued by the Thai Land Department. This form of ownership applies only to apartments. Freehold houses cannot be fully registered for foreign citizens, because land can be acquired in Thailand only by the Thais. According to the law, only 49% of the living space can be sold to foreign citizens in freeholds in each condominium. The rest (51%) can be bought by the Thais at freehold or by foreigners at leasehold.




Leasehold



If you decided to buy a house in Phuket, then the land can be issued in leasehold and the building itself in freehold. So you will have two contracts as a result of the transaction - one with an unconditional form of ownership, and the other - a contract for 30 years with the possibility of unconditionally renewing twice more for 30 years (total of 90 years).

Leasehold is a form of ownership limited only by time. You will also obtain Chanot in the Land Department, but a term of 30 years will be indicated in it. You will also receive a contract which provides for the unconditional extension of the designated period at least twice more.




Registration for a legal entity



Sometimes it happens that in the condo which you liked, 49% of the apartments have already been bought by foreigners and there are only options for the Thai quota, which can be bought by the Thais. In this case, the apartment can be issued to a Thai company, the founder of which will be you and a Thai citizen. The Thai founder may waive his rights in your favor and you will become a full owner. Typically, the cost of such objects is lower, but keep in mind that you will have to pay contributions to the capital and taxes annually.


When buying a private house by foreigners, registration of a land plot for a legal entity is also often used. Unfortunately, many local lawyers offering such companies to foreigners often make shareholders random people or employees of their office. This is against the law: such partners do not have the right to participate in the affairs of the company and even contribute money to the authorized capital (the shareholder’s money must be his own). In case of verification, such shareholders do not remember either the amount deposited or the name of the company. As a result, Thai partners can be determined as nominal and the registration of a company and all transactions, including a land deal become illegal. So it is better to formalize such a transaction through official real estate agencies, which will provide highly qualified assistance and competent legal support at all stages. Your company should carry out some kind of business: at least lease acquired housing, provide services and conduct other activities permitted by law. You must have employees, a valid address, financial transactions, and annual reporting.


Whatever option you choose, you can get detailed consultation in the Real Estate Gallery in Phuket. Here you will be introduced to the most interesting offers on the real estate market, specialists will provide information and legal support at all stages of the transaction.





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