You’ll be alarmed or relieved, depends on your risk appetite, to know that there is a ton of red tape if you are a foreigner wanting to buy property in Thailand. Having said that, you shouldn’t have any issues as long as you follow the necessary processes, especially when sending money to Thailand.
When it comes to either selling your property or leaving Thailand, it may be very difficult, if not impossible, to repatriate your money if the right processes are not done.
We’ll cover all you need to know about sending money into Thailand legally to buy a home in this article
Foreign Exchange Transaction Form
An FETF (foreign exchange transaction form) must be requested from the recipient bank if you are sending more than $50,000 for the purchase of a condo.
An FETF is not necessary, though, if the money is being transferred to buy a long-term leasehold on a house, a villa, or a capital share in a Thai company. Nevertheless, there must be clear documentation of the original transaction and proof that all applicable taxes were paid; in this case, the money can be sent outside of Thailand again in the future.
Even though a FETF may not be required, it can still be very helpful to request one because the latter process typically takes longer than when using a FETF.
FETF
All non-residents who are interested in purchasing a condominium in Thailand are required to make an international transfer only and specifically for that purpose, according to the Condominium Act.
No matter where the buyer is from, they must send money in a foreign currency, which will then be changed to Thai Baht when it reaches the receiving bank.
To register the condo with the Land Department, you must have the FETF paperwork. This serves as evidence that the entire transaction money was initially wired from abroad into Thailand.
It is generally advised to add multiple names (i.e., heirs) to the original transfer and include them in the FETF documents for estate planning purposes.
Fortunately, transferring the money out of Thailand again in the future is simple enough, but the necessary documentation must be provided, so this is an important step that must not be missed (especially if the money was borrowed from foreign lenders).
It is also crucial to remember that the money cannot be returned until all applicable income taxes and capital gains associated with the sale of the property have been paid in full. Again, in order to demonstrate your rightful ownership, the FETF must be shown to the appropriate tax authorities.
When buying a home in Thailand and transferring money internationally, we strongly advise that you seek legal counsel. The Thai legal system is complicated when it comes to international transfers and property ownership, so even though it may seem like an extra investment, it’s always worth hiring an expert to make sure that everything is legal and up to par.
Pro advice
Keep precise and thorough records of each move you make while investing in Thai real estate.
Before making your first payment, be certain that you are aware of all the requirements (for more information, speak with a trustworthy real estate agent in Thailand).
Keep in mind that the appropriate documentation for your transfer must be prepared by your Thai bank; the type of documentation necessary will depend on the reason for your transfer and the amount being sent.
Keep any supporting documentation from your bank, including the FETF and leasehold agreements, safe and treat it with extreme caution.
Make sure you are aware of the necessary taxes and fees you must pay and that you do so.
Conclusion
Even though working with competent legal counsel is always advised, it can be worthwhile to look into some respected real estate firms first. The rationale is that some of the better agencies can recommend in-house attorneys or legal teams that they work with frequently.
Although it might seem a little overwhelming, keep in mind that the process will go much more smoothly once you have a real estate agent and legal counsel on your side.
We really hope that this information was helpful to you and wish you the best of luck in your search for real estate in Thailand.
Contact us if want us to guide you through the whole process?
