Question 1

Is a 30+30 year lease renewal in Thailand enforceable?

Accepted Answer

The first 30 years are enforceable once registered, but the second 30 years rest on a promise the law does not guarantee. Section 540 of the Civil and Commercial Code caps a lease of immovable property at 30 years and permits renewal, but only for up to 30 years counted from the date of renewal, so the renewal must be granted afresh when the first term ends. Section 569 makes the registered lease survive a sale of the land, yet the renewal option is treated as a private agreement between the original parties and may not bind a person who buys the property during the first term. Price the deal on the first 30 years and treat the renewal as an unsecured expectation.

Question 2

If I build a house on leased land in Thailand, who owns the house when the lease ends?

Accepted Answer

That depends on the registered right you build under, so settle it in writing before you build. Section 146 of the Civil and Commercial Code says a building fixed to land by a person exercising a right over another person's land does not become a component part of the land, which lets you own the house separately during the term. Under a superficies, Section 1416 lets you remove your building at the end and restore the land, but if the landowner declares an intention to buy it at market value you cannot refuse without reasonable ground. Under a Sap-Ing-Sith, Section 11 of the Sap-Ing-Sith Act B.E. 2562 passes buildings the holder constructed to the landowner when the right ends unless the parties agree otherwise. Put an express end-of-term clause on the house in the registered instrument.

Question 3

Does a lease longer than three years have to be registered in Thailand?

Accepted Answer

Yes, if you want it enforced beyond three years. Section 538 of the Civil and Commercial Code provides that a lease of immovable property for more than three years, or for the life of the lessor or lessee, is enforceable for only three years unless it is made in writing and registered with the competent official. A shorter lease needs only written evidence signed by the party liable. Registration is done at the Land Office responsible for the area where the property sits. Do not pay long-term money against an unregistered lease.

Question 4

What does it cost to register a 30-year lease at the Thai Land Office?

Accepted Answer

The Land Office charges a registration fee of 1 percent of the total rent for the whole term, with key money counted as rent. Stamp duty of 0.1 percent of the same base is also collected, and it does not apply to farm leases. Small fixed items come on top, including an application fee of 5 baht per plot and a 5 baht duty on a duplicate contract. Section 539 of the Civil and Commercial Code splits the costs of a lease contract equally between the parties unless they agree otherwise. On a long lease these percentages add up, so budget them before signing.

Question 5

Can a foreigner own a house in his own name if a Thai national owns the land?

Accepted Answer

Yes, Thai law does not prohibit a foreigner from owning a building even where a Thai national owns the land. Section 146 of the Civil and Commercial Code keeps a building erected in the exercise of a right over another person's land from becoming part of that land, so the house can stand as your separate property. The clean way to hold it is a registered superficies, since Section 1410 lets the landowner grant you the right to own buildings on the land. Land itself stays closed, because Section 86 of the Land Code allows alien land ownership only under a treaty plus ministerial permission. Register the right rather than relying on an informal arrangement with the landowner.

Question 6

What is the difference between a lease, a usufruct, a superficies and a Sap-Ing-Sith?

Accepted Answer

They are four different rights over someone else's property, each with its own strength and transfer rules. A lease under Section 537 of the Civil and Commercial Code is a contract to use property for rent, capped at 30 years by Section 540, and Section 544 blocks subletting or transfer unless the lease permits it. A usufruct under Section 1417 gives possession, use, enjoyment and management, runs for a fixed period or for the holder's life under Section 1418, and Section 1422 lets the holder transfer only the exercise of the right. A superficies under Section 1410 is the right to own buildings on another person's land, and Section 1411 makes it transferable and inheritable unless the creating act says otherwise. A Sap-Ing-Sith under the Sap-Ing-Sith Act B.E. 2562 runs up to 30 years on titled land or condominium units under Sections 3 and 4, gives the holder near-owner rights under Section 11, and is transferable, mortgageable and inheritable under Section 12.

Question 7

Can a superficies or Sap-Ing-Sith be sold or transferred, and does the landowner have to consent?

Accepted Answer

Both can be transferred, and by default the landowner's consent is not required. Section 1411 of the Civil and Commercial Code makes a superficies transferable and transmissible by inheritance unless the act creating it provides otherwise, so a restriction binds you only if it was written into the grant. Section 12 of the Sap-Ing-Sith Act B.E. 2562 lets a Sap-Ing-Sith be transferred, mortgaged as security and passed by inheritance, and requires each juristic act to be made in writing and registered, after which the official notifies the landowner. Notification is not consent, so the landowner cannot veto a registered Sap-Ing-Sith transfer. Read the creating instrument first, since that is where any transfer restriction on a superficies will live.

Question 8

What does land due diligence in Thailand actually check?

Accepted Answer

It checks who really holds the land, what class of title it is, and what registered rights already bind it. Section 57 of the Land Code requires the title deed to state the holder's name and address, the location and area of the land and a map of its boundaries, and a duplicate of every deed is kept at the Land Office. Sections 71 and 72 make the Land Office the register for all rights and juristic acts over the property, so mortgages, leases and servitudes show up there. In practice on the islands this means a physical title search at the local Land Office branch before any money moves, plus confirmation that the plot carries full Chanote title and does not overlap national park or reserved forest land. Never fund against documents the seller supplies without pulling the Land Office record yourself.

Question 9

How do I verify that a developer really owns the land before I pay?

Accepted Answer

Check the Land Office record, not the developer's paperwork. Section 57 of the Land Code puts the holder's name on the title deed and keeps a duplicate of the deed at the Land Office, so a search there shows the registered owner and every registered burden on the plot. Section 72 requires the land rights document to be presented to the competent official for any registration, which means a seller who cannot produce the deed cannot transfer or lease to you. For a corporate developer, the Land Office itself demands a current company affidavit and shareholder list before registering, so pull the same records from the Department of Business Development and confirm the signatories have authority. If the registered holder is not the company you are paying, stop.

Question 10

Can I get my reservation deposit back if due diligence turns up problems?

Accepted Answer

Only if your reservation agreement says so, or if the seller is the party at fault. Section 378 of the Civil and Commercial Code sets the default rules for a deposit. It is returned if the party who received it fails to perform or the deal fails for a cause that party must answer for, and it is forfeited if the failure lies with the party who paid it. A bad due diligence result is not automatically the seller's breach, so walking away on your own findings risks forfeiture under the default rule. Section 378 applies only where nothing else is agreed, so insist on a written condition that the deposit is refundable if due diligence is unsatisfactory.

Question 11

Why is a Thai villa purchase often split into a lease, a construction contract and a management agreement?

Accepted Answer

Because Thai law forbids you to own the land but lets you own the house. Section 86 of the Land Code confines alien land ownership to a treaty route plus ministerial permission, and Schedule One of the Foreign Business Act bars foreigners from trading in land altogether. No law stops a foreigner owning a building, and Section 146 of the Civil and Commercial Code keeps a building erected under a right over another's land separate from the land itself. So the land comes to you as a registered lease capped at 30 years, while the villa comes through a separate construction contract or a superficies under Section 1410 that makes the building yours in your own name. Have each right registered where the law allows it, since the split only protects you if the building right is properly papered.

Question 12

How do I check that a plot of land has legal road access?

Accepted Answer

Confirm at the Land Office that the plot fronts a public road or carries a registered servitude over the land between it and the road. A servitude under Section 1387 of the Civil and Commercial Code binds the neighbouring land for the benefit of yours, and under Section 1393 it follows the land when either plot is sold, so a registered servitude is access you can rely on. A landlocked plot is not without remedy, since Section 1349 gives its owner a right of passage over the surrounding land to reach a public road, but that right comes with a duty to compensate the surrounding owner. Section 1350 removes the compensation duty where the landlocking came from a subdivision or partial transfer, and confines the passage to the divided land. A statutory right of passage still has to be asserted against a neighbour, so buy registered access, not a lawsuit. The title deed's boundary map under Section 57 of the Land Code shows what the plot actually touches.

Question 13

What should an off-plan villa contract in Thailand say about delays and defects?

Accepted Answer

It should fix a completion date, a daily delay penalty, and defect warranty periods, because the Civil and Commercial Code otherwise leaves you with default rules only. Under CCC section 596 a late-delivered build entitles you to a reduction of the price, and to rescission only where time is of the essence, so the contract should say expressly that time is of the essence and add a stipulated penalty under CCC sections 379 and 381. On defects, CCC section 600 makes the contractor liable, unless otherwise agreed, only for defects appearing within one year of delivery, or within five years for a structure on land, and CCC section 601 bars any action later than one year after the defect appeared. CCC section 599 lets you withhold payment where delivery is late or defective, and CCC section 594 lets you demand rectification during the build and hire a third party at the contractor's risk and expense if it refuses. Take delivery with a written reservation of your rights, because under CCC sections 597 and 598 accepting the work without reservation wipes out delay claims and most defect claims.

Question 14

When do I get my villa reservation deposit back?

Accepted Answer

You get it back, or credited against the price, when the deal completes, and you also get it back if the deal fails for a cause the developer is responsible for. Under Civil and Commercial Code section 378, unless the parties agree otherwise, an earnest deposit is returned or applied as part payment on performance, forfeited if the party who paid it fails to perform or is at fault in a termination, and returned if the party who received it fails to perform. Under CCC section 377 the deposit is also evidence that a contract exists and security for its performance. These are default rules, so read the reservation form before you pay, because its terms can displace them.

Question 15

Why do developers put the building permit in the company's name?

Accepted Answer

Because the permit is issued to the party that applies for and carries out the construction, and in an off-plan project that is the developer company, not the future buyer. Under section 21 of the Building Control Act B.E. 2522 whoever constructs a building must first obtain a permit from the local official or use the notification track, so the developer that builds the villa holds the permit from day one. Section 36 of the same Act then locks that position in, because a building permit cannot be transferred to anyone else without written permission from the local official. Check whose name is on the permit before you sign, because it tells you who legally controls the build.

Question 16

Can a building permit be transferred into my own name?

Accepted Answer

Yes, but only with the written permission of the local official. Section 36 of the Building Control Act B.E. 2522 states that permits issued under sections 21, 22 or 33 may not be transferred except with written permission from the local official, so a private assignment clause in your purchase contract does not by itself move the permit. There is one automatic route in section 37, which applies on the death of the permit holder, where the heir or estate administrator who notifies the local official within ninety days is treated as the permit holder. Build the developer's duty to apply for the official's permission into your contract rather than assuming the transfer will happen.

Question 17

My villa build is late. Can I claim the delay penalty in my construction contract?

Accepted Answer

Yes, and you can claim it on top of demanding the work itself. Under Civil and Commercial Code section 381, where a penalty was promised for improper performance such as missing the agreed time, you may claim the penalty in addition to performance. The same section sets a trap at handover, because once you accept the work you can only claim the penalty if you expressly reserved that right at the time of acceptance, and Civil and Commercial Code section 597 separately provides that a contractor is not liable for late delivery where the employer accepted the work without reservation. Courts also have power under Civil and Commercial Code section 383 to reduce a penalty that is disproportionately high. So take delivery in writing, with the penalty claim reserved, and never sign a clean handover while arrears of penalty are unpaid.

Question 18

Is a 51/49 Thai-foreign shareholding legal, or is it a nominee company?

Accepted Answer

A 51/49 split is legal in itself. Under section 4 of the Foreign Business Act B.E. 2542, a company is a "foreigner" only where foreigners hold at least one half of its capital shares, so a company with 49% foreign capital sits outside the Act's licence requirements. The same structure becomes a criminal nominee arrangement under section 36 of the Act where a Thai national holds the shares on the foreigner's behalf so the foreigner can operate a restricted business in circumvention of the Act. Section 36 carries up to three years' imprisonment or a fine of 100,000 to 1,000,000 baht or both, and the court shall order the shareholding to end. The paper ratio settles nothing on its own, because the authorities test whether the Thai shareholders are genuine investors.

Question 19

What do the authorities look at when they decide a company is a nominee?

Accepted Answer

They test whether each Thai shareholder is a genuine investor, looking at economic substance rather than the shareholder list. Published DSI and DBD criteria examine the Thai shareholder's financial capacity, the source of the share money, active participation in the business, proportionate returns, supporting documentation, and the commercial logic of the investment. Investigators also review share-structure features, including preference shares giving foreign shareholders favourable voting or dividend rights, board control, blanket powers of attorney, and loans on unusual terms. The legal basis is section 36 of the Foreign Business Act B.E. 2542. Scrutiny now starts at registration, since Central Registration Office Orders 2/2568 and 2/2569 require an investment clarification and three months of bank statements for every Thai shareholder where foreigners hold under 50% or a foreigner has signing authority.

Question 20

What happens if a Thai company is found to be a nominee structure?

Accepted Answer

The Thai shareholder and the consenting foreigner each face up to three years' imprisonment or a fine of 100,000 to 1,000,000 baht or both under section 36 of the Foreign Business Act B.E. 2542, and the court shall order the cessation of the shareholding. Disobeying the court's order draws a further fine of 10,000 to 50,000 baht per day. A foreigner who operated a restricted business without permission faces the same penalties under section 37, with a court order to cease the business. Under section 41, directors and representatives of an offending company who connived at the offence or failed to take reasonable steps to prevent it face the same imprisonment and fine. If land was acquired by a person as owner in place of a foreigner, the Director-General has power to dispose of that land under section 96 of the Land Code.

Question 21

How many Thai shareholders does a land-owning Thai company need?

Accepted Answer

The Land Code sets two tests rather than a fixed number. Under section 97(1) of the Land Code B.E. 2497, a limited company is treated as a foreigner for land purposes if foreigners hold more than forty-nine percent of its registered capital or if foreign shareholders are more than half of the total number of shareholders. Section 98 looks through corporate layers, so a shareholder company that itself fails section 97 counts as a foreigner. A private limited company needs at least two shareholders in any case under section 1097 of the Civil and Commercial Code as amended by Amendment Act No.23 B.E. 2565. Both tests must hold at all times, because land held by a person as owner in place of a foreigner can be disposed of by the Director-General under section 96.

Question 22

Do Thai shareholders have to prove where their share capital came from?

Accepted Answer

Yes, at registration, whenever foreigners are involved. Central Registration Office Order 2/2568 requires three months of bank statements from each Thai shareholder showing withdrawals or transfers matching the share payment, where foreigners hold under 50% of the capital or a foreigner is an authorized signing director. Central Registration Office Order 2/2569 adds an investment clarification letter identifying each Thai shareholder's paying bank account and the account that received the money. A separate registrar requirement calls for a bank letter certifying each Thai shareholder's financial standing in an amount consistent with that shareholder's stake. In an investigation, the source of the Thai shareholders' funds is a central factor in the DSI and DBD nominee criteria.

Question 23

Can a foreigner control a Thai company lawfully with less than half the shares?

Accepted Answer

The Foreign Business Act measures foreign status by capital, not by control. Under section 4 of the Foreign Business Act B.E. 2542, a company is a foreigner only where foreigners hold at least one half of its capital shares, and the definition says nothing about voting rights. The DBD has ruled, in a June B.E. 2564 advisory, that a company whose foreign investors held ordinary shares amounting to less than half the capital, with 51% held by Thai nationals as preference shares, was not a foreigner and needed no licence. At the same time, section 36 criminalizes any arrangement where Thai shareholders hold shares on a foreigner's behalf, and the published DSI and DBD investigation factors include preference shares granting foreign shareholders favourable voting or dividend rights and disproportionate voting power. The statute draws the line at capital, and the investigation criteria examine everything built on top of it.

Question 24

Can two foreigners incorporate a Thai limited company with no Thai shareholder?

Accepted Answer

Yes. Section 1097 of the Civil and Commercial Code, as amended by Amendment Act No.23 B.E. 2565, lets any two persons form a private limited company, and a company can be registered with wholly foreign shareholders. That company is a foreigner under section 4 of the Foreign Business Act B.E. 2542, so it cannot operate any business on the Act's restricted lists without a Foreign Business Licence or equivalent cover, on pain of the section 37 penalties of up to three years' imprisonment or a fine of 100,000 to 1,000,000 baht or both. Minimum capital rules also apply to a foreign company: 2 million baht for a business outside the restricted lists, or for licensed businesses the greater of 25% of average estimated expenses over the first three years and 3 million baht per licensed business, under the Ministerial Regulation issued under section 14. Plan the activity first, because the restricted lists cover most service businesses.

Question 25

How much registered capital does a Thai company need, and how much must be paid up?

Accepted Answer

The Civil and Commercial Code sets no general minimum registered capital for a Thai-majority company. Each share must have a par value of at least 5 baht, and on incorporation the directors must collect at least 25% of the amount payable on each share. A company that is foreign under the Foreign Business Act B.E. 2542 must meet the minimum capital rules under section 14: 2 million baht for a non-restricted business, or the greater of 25% of average estimated expenses over the first three years and 3 million baht per licensed business, and the DBD reads minimum capital as registered capital actually called and paid. Where foreigners hold under 50% or a foreigner signs for the company, the registrar also requires evidence that each Thai shareholder actually paid for the shares. Pick a capital figure the shareholders can evidence in their bank accounts, because the registrar now checks.

Question 26

Who is allowed to sign a contract on behalf of a Thai company?

Accepted Answer

The director or directors registered with the Department of Business Development as having signing authority, signing in the manner the registration states. A Thai company acts through its registered representatives, and under section 71 of the Civil and Commercial Code, where a juristic person has several representatives, decisions are made by a majority unless the law or its constitutive documents say otherwise. Under section 72, a change of representatives or a restriction of their powers takes effect once the legal requirements are met but cannot be set up against a third person acting in good faith. The registered signing formula may require one director alone, two directors jointly, or a signature with the company seal. Check the company's current DBD registration before relying on any signature, because the registered formula is what binds the company.

Question 27

What paperwork does a share transfer in a Thai company need?

Accepted Answer

A written transfer instrument, or the transfer is void. Under section 1129 of the Civil and Commercial Code, a transfer of shares entered in a name certificate must be made in writing, signed by both transferor and transferee, and certified by at least one witness, and the instrument must state the numbers of the shares transferred. The transfer is invalid against the company and third parties until the transfer and the transferee's name and address are entered in the company's register of shareholders. Under section 1130 the company may decline to register a transfer of shares on which a call is due, and section 1129 lets the articles of association impose their own restrictions on transfers of named shares. Check the articles before signing, because a transfer the articles do not permit will not reach the register.

Question 28

Should money go into a Thai company as share capital or as a shareholder loan?

Accepted Answer

Thai law does not prescribe one route, but it treats the two very differently. Money paid in as capital counts toward the Foreign Business Act's minimum capital, which the DBD reads as registered capital actually called and paid, while loans do not count. A company operating under a Foreign Business Licence is subject to a condition that its total loans for the licensed business must not exceed seven times its capital, and treaty routes such as JTEPA require a loan to capital ratio of 3:1 or lower. On the nominee side, the DSI and DBD investigation factors include loans on unusual terms, such as interest-free loans with no repayment schedule, and DSI guidance treats a Thai shareholder who funds shares with money borrowed from the foreign investor as a marker of disguised foreign ownership under the Foreign Business Act B.E. 2542. The funding route is visible to the registrar and to investigators, so it must match the story the share register tells.

Question 29

Do I need a hotel licence to rent out a villa in Thailand?

Accepted Answer

Yes, if you rent it out short term as a business, because that is hotel business under the Hotel Act B.E. 2547. Section 4 of the Act defines a hotel as accommodation established for business purposes to provide temporary accommodation to travellers or others for compensation, and section 15 prohibits operating a hotel business without a licence from the Registrar. Two exits matter for villa owners. Accommodation established to charge on a monthly basis or longer only is excluded by section 4(2), and under clause 1 of the Ministerial Regulation on hotel categories B.E. 2551, as replaced by Ministerial Regulation No. 2 B.E. 2566, premises with no more than eight rooms and no more than thirty guests in total fall outside the Act once the operator has notified the Registrar and received the acknowledgement. If your villa sits outside both exits, licence the operation before the first booking.

Question 30

Is 30 days the line that keeps a rental outside the Hotel Act?

Accepted Answer

No, the statute does not draw the line at 30 days. The exclusion in section 4(2) of the Hotel Act B.E. 2547 covers accommodation established for the purpose of providing accommodation charged on a monthly basis or upward only, so the test is the purpose of the premises and its charging basis, not the length of any single stay. The word only matters, because a villa that mixes nightly bookings with monthly lets is not established for monthly charging only. Structure the rental as genuine monthly or longer tenancies across the board if you intend to rely on this exclusion.

Question 31

Can a management company hold the hotel licence instead of the owner?

Accepted Answer

Yes, because the licence attaches to whoever operates the hotel business, not to whoever owns the villa. Section 15 of the Hotel Act B.E. 2547 prohibits any person from operating hotel business without a licence, and section 4 defines the hotel business operator as the person granted that licence, so the entity actually running the accommodation business is the one that must be licensed. Section 16 permits a juristic person to be the licensee, provided its managing partner, manager or representative meets the personal qualifications and none of the prohibitions in that section. A licence can also move to a qualified person with the Registrar's approval under section 24. Match the licence to the entity that contracts with guests, because a licence in the wrong name leaves the real operator unlicensed.

Question 32

Does a hotel licence holder have to own the land and the building?

Accepted Answer

No, ownership of the land or building is not among the licence conditions. The qualification list in section 16 of the Hotel Act B.E. 2547 is about the applicant personally, covering age of at least twenty years, domicile or residence in Thailand, no bankruptcy, no incapacity, no listed criminal record and no prior licence suspension or revocation, and it says nothing about owning the premises. What the building itself needs is authorization for hotel use, because clause 9 of the Ministerial Regulation on hotel categories B.E. 2551, as replaced by Ministerial Regulation No. 2 B.E. 2566, requires a hotel building in an area covered by the building control law to have evidence of permission under that law to use the building as a hotel. The Registrar does need to see a right over the land and the building, and the Ministry of Interior notification under section 15 names a lease or the owner's written consent as enough. So a tenant or operator can hold the licence, but line up the building-use evidence and the lease or consent before applying.

Question 33

Who may legally receive guests' booking money in a managed villa development?

Accepted Answer

The licensed operator of the accommodation business may take its own guests' money, but a company that collects payments electronically on behalf of the villa owners is in regulated territory. Under section 16(3) of the Payment Systems Act B.E. 2560, a service of receiving electronic payment for and on behalf of sellers, service providers or creditors is a designated payment service requiring a licence, and the Ministry of Finance Notification on designated payment services defines this as electronic collection for a seller, service provider or creditor under a contract appointing or engaging the collector. Section 17 of the Act restricts that regulated business to limited companies, public limited companies or other juristic persons prescribed by the Bank of Thailand, and section 19 obliges the provider to keep money received in advance in separate accounts, segregated from its own assets. On the accommodation side, section 15 of the Hotel Act B.E. 2547 requires the person operating the hotel business to hold the hotel licence. Route booking money to the licensed operator directly, or through a licensed payment provider, rather than through an unlicensed middleman account.

Question 34

Can I be a director of my Thai company without a work permit?

Accepted Answer

Not if you do anything that counts as work. The Foreigners Working Management Emergency Decree B.E. 2560 (as amended by No.2 B.E. 2561) defines work in Section 5 as engaging in an occupation, with or without an employer, and Sections 8 and 59 prohibit a foreigner from engaging in work without a work permit. There is no carve-out for directors, so a director who actively manages, signs for, or otherwise runs the company is working and needs a permit, while purely passive shareholding is not work. Working without a permit is an offence under Section 101, punishable by a fine of 5,000 to 50,000 baht followed by repatriation.

Question 35

What can I legally do on a DTV visa if I own a Thai company or property?

Accepted Answer

You can live in Thailand, work remotely for foreign employers or clients, and hold your Thai shares or property passively, but you cannot work for your Thai company. Clause 7 of the MOI Notification of 15 July 2024 (B.E. 2567) creating the DTV requires a holder who wishes to work in Thailand to first convert to a Non-Immigrant working-category visa and only then apply for a work permit, and under Clause 6 the DTV lapses on that conversion. No work permit is obtainable while you stay on the DTV, so any active role in the company, from managing staff to serving clients, is off the table. Owning the asset is fine. Running it from Thailand on a DTV is not.

Question 36

How much registered capital does a Thai company need per foreign work permit?

Accepted Answer

Two million baht of fully paid-up registered capital per work permit, with each additional 2 million baht supporting one more permit, up to a cap of ten permits. The requirement is halved where the foreigner is married to a Thai national in a registered marriage, and a foreign-registered employer needs 3 million baht of funds remitted from abroad per permit instead. Immigration applies its own separate test at extension time. Immigration Bureau Order 12/2568, clause 2.1(3), requires paid-up registered capital of at least 2 million baht for the one-year business extension of stay. Meet both tests, because the work permit and the visa extension are checked by different agencies.

Question 37

What does a Thai company need before it can sponsor a work permit and Non-B visa?

Accepted Answer

It needs to be a registered Thai company with at least 2 million baht of fully paid-up capital per foreign employee, and it must be registered for tax. For the one-year extension of stay that follows, Immigration Bureau Order 12/2568, clause 2.1, requires that the foreigner holds a temporary-stay visa, earns the minimum monthly income for his nationality in the Annex Kor income table, and that the business has paid-up capital of at least 2 million baht and files audited year-end financial statements. The same Order requires four full-time Thai employees per foreigner, relaxed to one-to-one for targeted-industry businesses and startups. Build the Thai payroll before you apply, not after.

Question 38

Which visa lets me legally run my own business from Thailand?

Accepted Answer

The Non-Immigrant B visa combined with a work permit is the route. Immigration guidance is explicit that no visa category permits work until a work permit is granted, and that a foreigner intending to work must obtain a Non-Immigrant B visa in order to apply for one. Once you hold the Non-B and work permit, the one-year business extension of stay is available under Immigration Bureau Order 12/2568, clause 2.1, if the company meets the capital, income, financial-statement and Thai-staff tests. The DTV does not allow work for a Thai company, and the BOI's LTR visa under Announcement Por.3/2568 is a separate route for qualifying high-potential applicants. Match the visa to the work before you start, because the work permit is what makes the activity legal.

Question 39

What taxes and fees are payable when transferring land in Thailand?

Accepted Answer

Four items, all collected at the Land Office on the day of transfer. The transfer fee is 2 percent of the official assessed value. If the seller is an individual, withholding tax is computed on the assessed value under the Revenue Code's progressive method, and either specific business tax at 3.3 percent including local tax, charged on the higher of the assessed value and the declared price where the sale falls within the specific business tax rules, or stamp duty at 0.5 percent of that higher price where specific business tax does not apply. If the seller is a company, withholding tax is 1 percent of the higher of the assessed value and the declared price, specific business tax at 3.3 percent applies, and no stamp duty is due because specific business tax was paid. Budget for these before you fix the price, because the buyer and seller must agree who pays what.

Question 40

Can I declare a lower price at the Land Office to reduce transfer tax?

Accepted Answer

No, the system is built so that a low declared price does not lower the tax. The transfer fee is charged on the official assessed value, an individual seller's withholding tax is computed on the assessed value, and both specific business tax and stamp duty are charged on the higher of the assessed value and the price you declare. So the assessed value operates as a floor whatever number you write down. Beyond that, knowingly giving false statements or showing false evidence to evade tax is a criminal offence under the Revenue Code, carrying imprisonment from three months to seven years and a fine of up to 200,000 baht. Declare the real price.

Question 41

Should I let a dormant Thai company sit, or close it properly?

Accepted Answer

A dormant company keeps every statutory duty of an active one, and only liquidation ends them. Under the Accounting Act B.E. 2543 a registered company must prepare and file financial statements with the Department of Business Development every year whether or not it carries on business, and the DBD fine schedule attaches fines to missed filings. Section 1273/1 of the Civil and Commercial Code also lets the Registrar strike off a company he has reasonable cause to believe is not carrying on business, after a 30-day inquiry letter and a newspaper notice. Formal closure through the liquidation chapter of the Civil and Commercial Code, Sections 1248 to 1273, is what actually ends the filing obligations. Letting it sit means paying accountants and fines for a shell that does nothing.

Question 42

How long does it take to liquidate a Thai company, and what are the steps?

Accepted Answer

The Civil and Commercial Code fixes no overall period, but its reporting cycle assumes months rather than weeks, and it expressly provides for liquidations that run beyond one year. On dissolution the directors become liquidators unless the articles say otherwise (Section 1251), and within 14 days they must register the dissolution (Section 1254) and notify creditors by newspaper advertisement and registered letters (Section 1253). The liquidators then prepare a balance sheet, have it audited, and call a general meeting to confirm the liquidators and adopt it (Sections 1255 and 1256), filing a progress report with the registrar every three months (Section 1267) and holding an annual meeting if the liquidation passes one year (Section 1268). When everything is settled, a final meeting approves the liquidation report and the liquidators register completion within 14 days of that meeting, which ends the liquidation and the company's status as a juristic person. Expect the three-month reporting cycle to run at least once, and longer where assets, debts or tax matters remain open.

Question 43

Does closing the company end nominee exposure?

Accepted Answer

The statutes do not say that it does. Section 36 of the Foreign Business Act B.E. 2542 makes it an offence for a Thai national or non-foreign juristic person to hold shares on behalf of a foreigner, or to assist or jointly operate a foreigner's restricted business, and the Act's penalties for nominee violations reach the people involved, both the foreigner and the Thai, with imprisonment up to three years or a fine of 100,000 to 1,000,000 baht or both, plus a court order to cease the business backed by daily fines of 10,000 to 50,000 baht for non-compliance. On the company side, Section 1249 of the Civil and Commercial Code deems a dissolved company to continue as far as necessary for its liquidation, and Section 1272 bars actions for payment of debts against the company, its shareholders or its liquidators only two years after the liquidation ends, a rule directed at debt claims. Nothing in either Act states that dissolving the company extinguishes offences already committed while it operated. That is what the statutes say, and where the analysis for a public page has to stop.

Leases and registered rights