Foreigners can own freehold property in Thailand through two legal ways: foreign freehold and leasehold property ownership[1][5][6]. Here are some key points about freehold ownership in Thailand:
- Freehold ownership in Thailand gives the owner absolute ownership of real property, meaning they own it indefinitely[1][3].
- There are two routes of freehold ownership in Thailand: freehold through a condo title and freehold through acquisition by a Thai company[1][3].
- Foreigners can own up to 49% of the unit area of any condominium on a freehold basis[6]. Once the 49% quota for foreign freehold ownership is reached, developers often give foreign nationals the opportunity to purchase leasehold in the Thai ownership part of the building[1][5].
- Thai company structures are used by foreigners to indirectly own land in Thailand whereby the company owns the land and the foreigner controls the company[3][6].
Advantages
- Freehold ownership in Thailand gives the owner complete ownership rights, including the right to mortgage or sell the ownership[2][3].
- Resale of real estate does not require the participation of third parties.
- No need to renew every 30 years.
- Demand for freehold is higher when reselling real estate.
Disadvantages
- Is declared and taxed including annual estate taxes and sales taxes:
- Transfer fee tax 2%
- Specific business tax 3.3% (in case of ownership of property less than 5 years)
- Stamp duty 0.5% (if Specific business tax does not apply)
- Withholding tax 1% for legal entities
- For individuals, the tax is calculated depending on the value of the property, taking into account the period of ownership and tax deduction, at the personal income tax rate.
- Land and building tax annually from 0.02% to 0.1% depending on the type of property and its value.
- Foreigners are not allowed to own land in Thailand, except through a Thai company[1][3].
- The cost of real estate in freehold is always more expensive by 7-10%.
In summary, foreigners can own freehold property in Thailand through foreign freehold and leasehold ownership. Freehold ownership in Thailand gives the owner complete ownership rights, including the right to mortgage or sell the ownership, and can be passed on to the next generation. However, foreigners are not allowed to own land in Thailand, except through a Thai company, and the remaining 51% of the condominium have to be owned by Thai nationals.
Citations:
[1] https://www.conradproperties.asia/blog-news/freehold-leasehold-property-ownership-thailand
[2] https://www.golawphuket.com/thai-real-estate/freehold-leasehold-rights/
[3] https://phuketrealtor.com/blog/what-does-freehold-mean
[4] https://www.benoitproperties.com/news/buying-freehold-property-in-thailand/
[5] https://www.phuket.net/property/blog/difference-foreign-freehold-leasehold-thailand
[6] https://blog.listglobally.com/en/different-ways-foreigners-can-own-property-in-thailland