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Condo Inheritance

Written by Property Lawyer

A condo unit acquired by inheritance by foreigners

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Basically, foreigners CANNOT inherit ownership of a condominium in Thailand! (Robert M. Spelde)

Condominiums in Thailand are popular among foreigners as condos offer full freehold ownership titles for the buyer

Foreign condominium ownership:

The main limitation of foreign ownership under the Thailand Condominium Act is that not more than 49% of the total floor area of all units in a condominium building combined can be foreign owned. Section 19 bis of the Condominium Act:

Section 19 bis: 'Each condominium shall have aliens or corporate as indicated under Section 19 holding ownerships in the units collectively not exceeding forty-nine percents (49%) of the spaces of the whole units in such particular condominium at the time of making the registration of such condominium in accordance with Section 6.'

To register ownership the foreigner (including any foreigner who inherits or is entitled by law or by the terms of a will to inherit ownership of a condominium) must comply with section 19 of the Condominium Act. The following foreign natural or juristic persons are qualified to register ownership of a condominium unit within the foreign ownership quota of the condominium:

Aliens permitted to have residence in the Kingdom under the Immigration law;
Aliens permitted to enter into the Kingdom under the investment promotion law;
Juristic persons as provided in Section 97 and 98 of the Land Code and registered as juristic persons under Thai law;
Juristic persons which are aliens under the Announcement of the National Executive Council No.281 dated November 24, B.E. 2515 and have obtained promotion certificate under investment promotion law;
Aliens or juristic persons regarded by law as aliens who have brought in foreign currency into the Kingdom or withdraw money from Thai baht account of the person who have residence outside the Kingdom or withdraw money from a foreign currency account.

If the foreigner is qualified and submitted proof of qualification (e.g. Foreign Exchange Transaction Form), and the unit falls within the foreign ownership quota, registration of ownership in the foreigner's name is a straightforward process.

Inheritance of a condominium unit by foreigners in Thailand

The Condominium Act B.E. 2522, as amended by Condominium Acts No. 1 – No. 4, deals with inheritance of a unit by foreigners in sections 19 quinque (5) and 19 septum (7). Section 19 quinque refers to foreigners qualified under section 19 of the Condominium Act and section 19 septum deals with foreigners NOT qualified for ownership under section 19 of the Condominium Act.

Any foreigner who acquires a condominium unit by inheritance either as statutory heir or inheritor under will in Thailand shall have ownership rights over such unit, however inheritance does not qualify the foreigner for registration of ownership of the unit at the Land Department. Also a foreign heir must comply with the requirements and restrictions and qualify under section 19 of the Condominium Act or he must sell the unit within one year of the date of acquisition.

Qualified foreigners (under section 19) for registration of ownership of a condominium unit acquired by inheritance:

Section 19 Quinque Condominium Act: The foreign natural or juristic person as provided in Section 19 (qualified) shall dispose of apartment in the following cases:

'When the alien or juristic person stipulated in Section 19 (a qualified foreign natural or juristic person) has acquired an apartment unit by legacy in the capacity of statutory heir or inheritor under will or by other means (e.g. gift) as the case may be, and when included the apartment already held by aliens or juristic persons stipulated in Section 19 exceeding the ratio prescribed in the first paragraph of Section 19 bis.'

The above section simply refers to a situation where the foreign heir is qualified under section 19, however transfer of ownership would exceed the foreign ownership ratio within the condominium. E.g. a Thai national leaves ownership to a foreign heir, but the foreign ownership quota in the condominium is already filled up. In this case it is required by law that the unit shall be disposed by the foreigner within 1 year from the date of acquisition of such condominium unit. If the foreigner fails to do so, the Director-General of Land Department shall have power to sell the condominium unit on the foreigner's behalf; section 19 paragraph 4:

'The disposition of apartments under the third paragraph shall be made within a period of not exceeding one year from the date of acquisition of ownership of such apartments, or the date of revocation of permission to have residence in the Kingdom, or the invalidation of the residence certificate or the date of being ordered deported or de the date of revocation by the Board of Investment of permission to stay in the Kingdom, or the date of revocation of promotion certificate as the case may be. If the disposition is not made within the said period, the Director-General of Land Department shall have the power to dispose of such apartment, and the provisions regarding the the compulsion of disposition of land under Chapter 3 of the Land Code and the Ministerial Regulations issued thereunder shall be applied to the disposition of such apartment mutatis mutandis'.

Disqualified foreigners for registration of ownership

Section 19 septum Condominium Act:

'An alien or juristic person regarded by law as alien other than those specified in section 19 who acquires an apartment by inheritance as statutory heir or legatee or otherwise, as such case may be, shall notify in writing the Competent Official within a period of sixty days from the date of acquisition of ownership of apartment, and shall dispose of such apartment within a period of not exceeding one year from the date of acquisition of ownership of apartment. If disposition is not made within said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mutandis.'

Section 19 septum refers to any foreigner who is not qualified to register ownership under section 19. A foreigner who acquires a condominium unit by inheritance and who is not qualified to register ownership must notify the competent official within 60 days from the ownership acquisition date and shall dispose the condominium unit within 1 year of the date ownership was acquired. If the foreigner fails to dispose of the land the Director-General of the Land Department is authorized to dispose of the unit and retain a fee of 5% of the sale price before any deductions or taxes.

Inheritance of a condominium in Thailand

In short: the Condominium Act section 19 refers to two kinds of foreigner who inherits or are entitled by law or by the terms of a will to inherit ownership of a condominium: 1. qualified foreigners under section 19, and unqualified foreigners. The following situations could arise:

A qualified foreign successor under section 19 of the Condominium Act obtains ownership in a unit over the permissible foreign ownership quota. In this case there is no solution possible and the foreigner has to dispose of the condominium unit within 1 year of the date ownership was acquired.
A qualified foreign successor obtains ownership within the foreign ownership quota and is able to register ownership.
Unqualified foreign successor obtains ownership of a unit not within the foreign ownership quota within the condominium. No solution is possible and as under 1 above the unit must be sold within 1 year of the date of acquisition.
An unqualified foreigner inherits a condominium within the foreign ownership quota. For registration of ownership the solution would be to become eligible for ownership under section 19 (e.g. transferring and exchanging foreign currency into Thailand equal to the appraised value of the condominium unit) or the unit must be sold within 1 year of acquisition.

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