Koh Samui, Thailand property - Legal FAQs

Thai law states that foreigners cannot own land, they can own buildings only. So, if a foreigner wants to buy a house, (or duplex/townhouse), which includes land, he has two basic ownership options for acquiring the land.
  1. Set up a carefully structured Thai limited company to hold the freehold of the land. The freehold of the land is put in the company name. The minimum requirement for the company is for two Thai shareholders. These Thai shareholders will be provided by the lawyer setting up the company. The foreign buyer is made a director, and a shareholder, in the company. You can also have more than one foreign shareholder or director but the total foreign shareholding must not exceed 49%. Crucially, there are a number of protective measures always put in place by the lawyer setting up the company to create a very safe structure for the foreign directors. These give the foreign directors complete control and they typically include, but are not limited to, the following: the foreign director(s) is the only officer who can commit or bind the company in any contractual dealings; the director’s shares are preference shares and hold 10 times the voting rights of the nominal shares, giving the directors 90% of the voting power; when the company is set up, all of the Thai shareholders sign an open dated share transfer form. This means that they can all be signed out and replaced with other shareholders whenever the foreign director(s) wishes.

    The company owns the freehold of the land and the investor(s) is free to build on the land, sell or lease property and transfer their rights to next of kin.

    Note: The company must comply with the law and money should pass through the company books, shareholder meetings must be held, minutes of meeting prepared, and yearly accounting must be filed. But a good local accountant can take care of all of this for you. It is easy to put some expenses for running the property through the company books. The accountant will also submit annual accounts for a typical fee of around 20,000 THB.
  2. Lease the land on a rolling 30 year lease. An alternative to setting up a Thai limited company is for the foreigner to purchase a 30 year lease for the land. Options to renew the lease for 2 further periods of 30 years are built into the contract to make a total lease period of 90 years. The contract can also include a fixed option to purchase the freehold whenever the foreigner wishes.

    Note:  The house itself (i.e. the building) can be owned directly by the foreign buyer. However, if the freehold of the land is held in a Thai company, then the house will typically be held in the same company. This is for reasons of tax efficiency and ease of resale.
Condominiums in Thailand are distinct from ‘standard’ apartments in that they have a condominium licence which means that up to 49% of the private living space of the condominium building can be bought by foreign investors on a freehold basis. The remaining 51% can be directly owned by Thai individuals, held in a Thai company or leased to foreigners.

Regarding ‘regular’ apartments (i.e., where the development has no condominium licence), the ownership structure is either a 30-year lease and/or shares in a company which holds the freehold. In the case where the apartment is both leased and the buyer also given shares in the company owning the freehold, this is often referred to as I protected leasehold structure because having shares in the company owning the freehold makes the lease renewals more secure. Regarding the leasehold term, 30-years is the maximum allowed in Thai law for one term, however, options to renew the lease for 2 further periods of 30 years are typically built into the contract to make a total lease period of 90 years.
There are two types of land titles in Thailand over which registerable right of ownership can exist. These are Chanote and Nor Sor Sam Kor. They are the only types of land title that a careful foreign investor should consider.

Chanote (Chanote ti din)

Chanote titles are issued by the Thai Land Department and are accurately surveyed and plotted in relation to the national survey grid. They are also marked by unique numbered posts set in the ground. The ownership of the land title can be transferred within a matter of hours. This is the best type of land title for a foreign investor.

Nor Sor Sam Kor

These titles, though still measured relatively accurately, are less accurately measured than Chanote titles. Transfer of ownership can take longer than the case of Chanote.

Nor Sor Sam

The predecessor to Nor Sor Sam Kor was Nor Sor Sam. The boundaries of Nor Sor Sam titles are only recorded with relation to neighboring plots and survey errors of up to 20% are not unusual. Unlike Nor Sor Sam Kor, Nor Sor Sam titles also require 30 days public notice before any change of land ownership can occur. There are many types of land title less recognised than Nor Sor Sam such as Sor Kor Nung. These are basically and form of squatters or settlers claim. You cannot even apply for or obtain approval to build on such land.
A Thai limited company, securely structured to hold land for a foreign director/investor, can be set up within a few weeks for a reasonable fee. We can assist by recommending a reputable Thai law firm with which we have dealt many times before.
The minimum requirement for the company is for two Thai shareholders. These Thai shareholders will be provided by the lawyer setting up the company. So, if you have 1 foreign director, you still need 2 Thai shareholders.
Visa options and details change on a regular basis, especially during pandemics, so you are advised to check for the latest info with the Thai embassy in your country of residence.

Visa Exception Rule
Under normal circumstances, residents of around 50 countries (the list changes), including the UK, USA, Australia, and most of Europe, can enter Thailand and stay for 30 days without a visa by using the Visa Exemption Rule. If you need to stay longer, you can extend your stay once for up to 30 days. You must apply for the extension before your visa exemption period ends.
Visa Options Include:
Visa on Arrival
Passport holders from 19 countries, including China and India, may apply for visas at the immigration checkpoints on arrival for the purpose of tourism and will be granted permission to stay in Thailand for a period not exceeding 15 days. Visitors who enter Thailand by Visa on Arrival cannot normally file an application for extension of stay, except in special cases of illness which prevents them from travelling. 

Single Entry Tourist Visa – usually issued by a Thai embassy abroad. These are valid for 60-90 days depending on the country of issue.
Multiple Entry Tourist Visa
These are valid for 6 months and allow multiple entries within a six-month period, the duration of each stay may only last for up to 60 days.
Retirement Visa (Non-Immigrant O)
This type of visa may be issued to applicants aged 50 years and over who wish to stay in Thailand for a period of not exceeding 1 year without working. The visa is valid for one year but every three months you need to report to Immigration every 90 days to verify your current address. Other than being 50 years old, requirements for this visa include showing a bank statement with a deposit balance of at least 800,000 Baht or a monthly income of at least 65,000 Baht.
Business/Work Visa - Non-Immigrant B
This is for individuals who wish to enter Thailand to work or to conduct business, either via an employer or self-employment. There are 2 types:
   90 Days Non-Immigrant Visa (Single-Entry) - this is issued by the Thai embassy or consulate in your home country which allows a stay of 90 consecutive days in Thailand.
   1-Year Non-Immigrant Visa (Multiple-Entry) - this is issued to those who want to conduct business and intend to frequently travel in and out of Thailand. This non-immigrant business visa can be extended to this visa once the work permit is processed.
Thailand Elite
Thailandf Elite Visas are long-term visa categorized under Privilege Entry Visa allowing residency in Thailand, along with extra benefits, for a period between 5 and 20 years depending on the chosen package.  There are substantial one-off fees and annual fees to pay but these visas are ideal for those seeking long term stay, with multiple entry facilities plus various VIP services who can afford to bypass the bureaucracy.
Land prices are normally quoted in baht per Rai but sometimes baht per Talang Wah for smaller plots:
1 Rai = 1600 sqm ie 40M * 40M
1 Acre = 2.53 Rai
1 Hectare = 6.25 Rai
Talang Wah = 1 sq Wah = 4 sqm
1 Rai = 400 Talang Wah = 400 sq Wah
1 Ngan = 100 sq Wah