Webinar Registration
Join our weekly webinar for smarter investing in Thai real estate.
Advanced Search
Your search results

Legal & Tax

Thailand Legal & Tax information


1.1.1  Building and Construction

Q: How do I obtain a building permit?

A: Building permits may be obtained at the Local Administration organization (Aor Bor Tor), or the Municipal Office where your land is located. Structural plans submitted shall be certified by an architect or an engineer. A building must have the specifications indicated in the application.

In the case of condominium buildings with 80 or more units or with an interior area of 10,000 sq meter or more they must also pass an Environmental Impact Assessment (EIA).


Q: What is an Environmental Impact Assessment (EIA)?

A: Condominium buildings of greater than 80 units or 10,000 sq meters require an evaluation on the impact to the environment.  This evaluation is called an Environmental Impact Assessment (EIA).  Building proponents must submit a report to the Environmental Impact Evaluation Division (EIED) of the OEPP.

The EIA report may be in the form of an initial environmental examination.  The EIED examines the report to determine its adequacy.  If the report is acceptable, the review process begins.  An Expert Review Committee, which consists of people qualified in various technical disciplines, makes the final decision.

The Committee may approve or reject the report, or may request additional information or revisions.  If the report is approved, the permitting agency grants the permit for the project with conditions of mitigation measures and monitoring programs.

1.1.2  Condo Laws and Terms

Q: If I purchase a condomium, who holds the title deed to the land and the common areas?

A: The land and common areas of a condominium building are owned by a “juristic person” (a Thai corporation) controlled by the condominium unit owners.  The title deed for each condominium unit is held by the owner of each condominium unit.


Q: Can ownership of a condominium be inherited by a foreigner?

A: Property ownership of a condominium can be inherited if the heir to ownership meets one of the original criteria for foreign ownership. Otherwise the condominium must be sold within one year of inheritance. Even if you have a will and testament in your home country, it is advisable that you also make a Thai will and testament.  Although your heirs can ultimately still inherit any property you leave for them, existence of a Thai will and testament can assist in avoiding significant delays with the probate process.


Q: What is a Chanote?

A: A Chanote or Land Title Deed is the purest form of evidence that an individual owns property.  It is a certified document issued by the local land office providing documentation as to who the legal owner of record is for a given property.  Chanote are given only for areas of Thailand which are surveyed.


Q: What is a Maintenance or Common Area Fund (condo dues)?

A: A maintenance fund is paid by all the condo owners of the building to provide funding for the routine maintenance and utility costs of the building for the common areas.  The maintenance amount is typically stated as a rate per square meter per month, and is often paid in advance for the subsequent year.  It is important to note that this does not cover any maintenance inside the individual units.  It also does not cover the cost of any major infrastructure or unforeseen damage to the common areas or the building itself.


Q: What is a Sinking Fund?

A: A sinking fund is a reserve fund established, usually at the time a new condominium project is constructed, to pay for any non-routine, structural damages or repairs and replacements to common areas or infrastructure.  This fund can be used only if agreed to by the condo association.


Consumer Protection

Q: What are the latest developments with the newly proposed escrow laws?

A: The new law does not change the profile to buyers or sellers, it deals with the status and conditions of the escrow officer.  Use of the service is not required, and in fact escrow services are not yet widely available.  Various companies are in the process of applying for permission to serve in this capacity.


Q: What additional protections are now in effect with the passage of the amendments passed to the Condo Act in July, 2008?

A: The passage of the Condo Act amendments provide the following added protections to condo buyers in Thailand:

Developers must include brochures with contract & deliver as advertised.

Clearer definition of committee membership & governance was provided. The amendments provide for a 3 to 9 committee membership with no member serving more than two 2-year terms.

Meetings need 50% membership in attendance to have a quorum.

Voting weights are allocated proportionally based on size owned, not based on number of units.

More transparency – annual reports must be audited and available to all owners.


Q: Does Thai law provide for warranties on condominiums and houses?

A: New condominium units and houses purchased directly from developers are protected by 5 year statutory warranties.  These warranties are for structural damages to the condominium or house.  Warranties to the inside of the property are stipulated in the purchase and sale agreement.  Warranties for air conditioners, sanitary fittings and other fixtures vary based on the manufacturer.

1.1.3  Funds Transfers

Q: What is a Foreign Exchange Transaction Form? Is it the same as a Tor Tor 3?

A: Foreign Exchange Transaction Form is an official bank document issued by the receiving bank upon the receipt of foreign currency into your bank account in Thailand. You must request this form (yes a Tor Tor 3 is the same thing) from your bank when you are remitting funds to Thailand for the purpose of purchasing a Condominium in Thailand, and the Foreign Exchange Transaction Form must specify that the remittance is solely for the purpose of purchasing a property in Thailand. This form is only necessary if you transfer the equivalent of over $20,000 USD into Thailand in any foreign currency to buy a property and at a later date you wish to sell the property and transfer the money back out of the country.


The following lists the scenarios for obtaining a Tor Tor 3 (TT3):

  1. If you transfer a foreign currency amount greater than $20,000 USD to Thailand straight into the developer’s bank account, then the developer can get the TT3 form from the bank for you.
  2. If you transfer a foreign currency amount greater than $20,000 USD to Thailand into your real estate agent’s bank account, then the real estate agent can get the TT3 form from the bank for you.
  3. If you transfer a foreign currency amount greater than $20,000 USD into a bank account you hold in Thailand and subsequently transfer that money to the developer’s bank account in Thailand, then you are responsible for getting the TT3 form from your bank.
  4. If you have transferred money into Thailand over 10 years ago and you lost or did not get a TT3, banks don’t hold records that long and there is no way the bank can provide you with a TT3. Keep any and all TT3 in a safe and secure place.

Q: Can I take money out of Thailand when I sell my property?

A: A person earning money from selling property in Thailand is taxed a withholding tax (from 0 to37%). Additionally, a specific business tax of 3.3% of the appraised price or the purchase price (whichever is higher), must be paid in cases that a buyer has a property in his possession for less than 5 years. A fee of transfer of ownership is 2% of the appraised price. A government stamp duty of 0.5% must be paid only when a specific business tax is not applicable.

As regards to transferring monies out of Thailand, you can transfer out an amount not to exceed the amount as documented on the Foreign Currency Transaction Forms (Tor Tor 3) you obtained from your bank when you initially purchased the property. If the proceeds from the sale exceed the amount documented on your Tor Tor 3, this excess amount must be kept in a Thai bank account.

You must bring your Tot Tor 3, your bank account documents and a passport to a bank to arrange a transfer. A transfer of more than $20,000 USD must be informed to the Bank of Thailand. A transfer of more than 2,000,000 baht must be informed to the Anti-Money-Laundering Office.

1.1.4  Land and Space Measurements

Q: What are the Thai land & space measurements – conversion to western measurements?


1    sqare meter (sq. m.) 10.76391    square feet (sq. ft.)
100    square / talang wah 1.00    ngan
4    square meters (sq. m.) 1.00    square / talang wah  (sq. wah)
4    ngan 1.00    rai
1    rai 0.395   acres
1    rai 0.16     hectares
1    rai 1,600    sq. m.
1    rai 400    sq. wah
1    acre 2.532    rai







1.1.5  Leases and Rentals

Q: Can a foreigner enter into a long-term lease for land?

A: Because of the barriers in place to the purchase of land by foreigners, one of the most effective ways to acquire land that a building resides on is to “purchase” the land on a 30-year leasehold with an option to extend the lease for subsequent 30-year periods. Leases are limited to 30 years, except on land for industrial purposes or commercial leases, which may be established for 50 years. Similarly, lease extensions are capped at 30 and 50 years respectively.

Possession of the land leased for an already owned building is protected by the fact that the building rests on the land; ownership of the building is separate from the land and cannot be seized by the lessor once the lease expires. Leases exceeding three years are enforceable for only three years unless they are registered with the Land Department. Therefore, a 3-year or longer lease must be registered with the Land department. In addition, a lease continues to be valid even in the event the property on the land is sold.


Q: Can a foreigner enter into a long-term lease for a condominium?

A: Yes. Condominiums may be leased to foreigners for periods of up to 30 years and may have options to renew. This structure is becoming more popular for foreigners who want to “own” a condominium in a building which exceeds the foreign ownership quota. It is also a viable structure for elderly or others who want to enjoy a property for several years but do not want to purchase a property. Leases of greater than 3 years are required to be registered with the Land Department.


Q: Can a foreigner legally rent out property he owns in Thailand?

A: Yes. A foreign-owned property may be leased out to another third party. Rental revenue is subject to a 12.5% tax on the annual income.

1.1.6  Property Ownership

Q: Can foreigners own buildings even if they don’t own the land?

A: YES. Although Thai law prohibits foreigners from owning land in Thailand, foreigners have the right to own buildings. A common structure is for the foreigner to enter into a long-term lease for the land from a Thai company or individual, and to build the home which the foreigner owns.


Q: Can I buy property in Thailand while out of the country?

A: Yes. A person wishing to buy property, including a foreigner, may purchase a property without being present at the time of registration of ownership at the Land Department. This shall be done by appointing, by a power of attorney, a Bangkok real estate lawyer or some other person to act on your behalf.


Q: Are foreigners allowed to own land in Thailand?

A: Under strict application of the existing law it is officially prohibited for foreigners, including both individuals and juristic entities (e.g., companies or partnerships), to own land in Thailand. However, there are exceptions to the prohibition found in the law itself. There are also other methods of arranging for the purchase of land in Thailand.

The Land Code has been amended to allow foreigners to own land if all of the following requirements are met:

  1. The land is for residential purposes.
  2. The land does not exceed one rai (in area; see conversion to western units below).
  3. No less than 40 million baht is remitted into Thailand for investment.
  4. Foreigners abide by Ministerial Regulations governing the nature of the business that the foreigner will engage in, the period of time for maintenance of the investment, and the location of the land owned.
  5. Permission is granted by the Board of Investment (BOI). According to section 97 of the Thai Land Law, the definition of a foreigner includes a Thai registered company or partnership in which more than 49% of the capital is owned by foreigners or of which more than half the shareholders or partners are foreign citizens. This does not happen often.

Q: What are the requirements for a foreign individual or organization to purchase a condominium in Thailand?

A: In order for a foreigner to purchase a condominium one of the following requirements must be met:

  1. A foreigner has permanent residence in Thailand in accordance with Thai Immigration Law.
  2. A foreigner is allowed into or resides in Thailand in accordance with Thai Investment Promotion Law.
  3. .A foreign legal entity is in accordance with the Announcement of the Foreign Business Act BE 2542 (AD 1999), and has been granted an Investment Promotion Certificate in accordance with the Investment Promotion law.
  4. A foreigner or foreign legal entity who brings foreign currency into Thailand, or brings in Baht currency from the account of a person residing abroad, or uses foreign currency from their deposit account. This requirement is normally met by the presentation of a Tor Tor 3 form which is provided by the bank receiving an incoming remittance from abroad.

Q: What are the different types of rights to private land?

A: Land can be controlled through the right of possession or through title deeds and other documentation. Individuals who actually possess and use land may have the right to possess such land under the Civil and Commercial Code. The primary form of evidence for ownership of land is a title deed (Chanote or Nor Sor 4). These title deeds must be registered at the Land Department in the province in which the land is located. It should also be noted that a parcel of land may be commonly held by several individuals.

A person whose name appears on a Chanote, or Land Title Deed, has all the legal rights to that land, can produce the deed as evidence of ownership to Government officials, can prove the land has clearly defined boundaries, and can engage in legal acts upon that land as allowed by law.

Q: Can a foreigner acquire land or property in Thailand through a Limited Company?

A: Yes, one method foreigners can employ to acquire land or property is by forming joint venture companies with majority Thai ownership but with adequate safeguards to protect the foreigners’ minority interest. If a foreigner plans to run a business in Thailand then he may purchase the land freehold through his Thai majority limited company. The land will be owned by the Thai Company, not by the individual. It is important that the non Thai minority shareholder should not own more than 38%, as any foreign shareholding structure greater than this is normally investigated by the Land department.


Q: Can a foreigner own a Freehold condominium in Thailand?

A: Buying a Condominium in Thailand is perhaps the simplest and easiest option available to foreigners who want to own property. The only restriction on purchasing a Condominium in Thailand is that the percentage of livable space sold to foreigners cannot exceed 49% of the total space available in the complex and that the funds used to buy the condominium have been remitted from abroad and recorded as such by a Thai Bank on a Foreign Exchange Transaction Form (Tor Tor 3). The owner of each Condominium unit is issued with a title deed (Chanote) clearly showing the foreigner as the legal owner of the unit.


Q: My wife is a Thai national. Can she own land?

A: Yes, since 1999! Before 1998, any Thai who married a foreigner would lose their right to purchase land in Thailand. They could, however, still retain land owned prior to marrying the foreigner. The Ministerial regulation from 1999 now allows Thai nationals married to foreigners the right to purchase land. The Thai spouse must prove that the money used for the purchase of freehold land is legally and solely theirs with no foreign claim to it. Normally this is done by the foreign spouse signing a declaration stating that the funds used for the purchase of property belonged to the Thai spouse prior to the marriage and are beyond his claim.


Q: I am married to a Thai. We would like to build a house on land given to us by my wife’s mother. What is the best way to secure my investment in case of a breakup?

A: Signing a long term lease with your wife and registering that lease at the Land Office is the most secure way of protecting your investment. If you have a child they may own the improvements in their name. We suggest you contact a lawyer who can advise you in more detail.

1.1.7  Property Taxes

Q: What taxes, fees and costs are applicable to purchasing a property in Thailand?

A: The following taxes apply for purchases of property in Thailand:

Transfer Fee of 2% ( 0.01% until April 2010) of land assessed value.

Business Tax of 3.3% (0.11% until April 2010) of the sales price or the assessed value, whichever is higher, must be paid in cases that a seller has a property in his possession for less than 5 years.

Stamp Duty of 0.5% of the appraised price must be paid only when a specific business tax is not applicable.

NOTE: the matter of who pays for these taxes is negotiated at time of offer.  It is very common that these taxes are shared equally between buyer and seller.


Q: Are there property taxes in Thailand?

A: There are no property taxes as such in Thailand that are exactly equivalent to the property taxes in the west.  The most comparable taxes on properties in Thailand are the Land Tax and the Structures Usage Tax. The Land Tax levied on land is so miniscule, that in practice the body charged to collect it, rarely bothers to do so, and if they do, they usually wait several years until the amount accumulates. The second tax, the Structures Usage Tax, relates to buildings, is collected by the municipal office or district office, and is only applied to properties used for commercial purpose.


Q: What taxes, fees and costs are applicable when I sell a property in Thailand?

A: The taxes when selling a property are the same as when buying, except there is also a withholding tax.  This tax ranges form from 0 to37%.  The tax rate varies based on the income of the seller as follows:

  • 0 to 80,000 THB:           0%
  • 80,001 to 100,000:         5%
  • 100,001 to 500,000:      10%
  • 500,001 to 1,000,000:    20%
  • 1,000,001 to 4,000,000: 30%
  • 4,000,001 and above:     37%

The basis of the tax is the government appraised value less a deduction of between 50% and 92%, depending on how long you own the condo. The longer you own the condo, the lower the deduction from the appraised value, and therefore your withholding tax liability is higher.  Specific withholding rates are as follows:

  • 92% if you have held the property for one year,
  • 84% for two years,
  • 77% for three years,
  • 71% for four years,
  • 65% for five years,
  • 60% for six years,
  • 55% for seven years,
  • 50% for eight years or more.

As with buying property, the following taxes apply for purchases of property:

Transfer Fee of2% ( 0.01% until April 2009) of land assessed value.

Business Tax of 3.3% (0.11% until April 2009) of the sales price or the assessed value, whichever is higher, must be paid in cases that a seller has a property in his possession for less than 5 years.

Stamp Duty of 0.5% of the appraised price must be paid only when a specific business tax is not applicable.

1.1.8  Strategies and Tips

Q: I am considering purchasing a newly launched project scheduled to be completed in two years. Do you have any advice for me?

A: Buying a condo or house “off plan” will normally provide favorable pricing and can be a very good investment.  Make sure to conduct adequate due diligence before signing a contract and depositing money.  Inquire about permits and EIA approvals.  Know who the developer is and check out the projects they have done in the past.  Understand the payment structure and make sure you have the required funds to complete payments on time. Obtain a copy of the contract and keep it in case any questions arise.

Tags: buildings, building, condominium, units, case, application, specifications, submitted, certified, architect,engineer, interior, environmental, impact, assessment

Compare Listings