Property through a Thai company

A Thai limited company, majority-owned by Thai shareholders, can own land in its own name — that is ordinary Thai company law, and it is a genuine route to controlling land for a foreigner who has a real business reason to be there. It is also one of the most misused structures in Thai property, because a company built around nominee shareholders who have no real stake in it is not a loophole — it is a violation of the Land Code and the Foreign Business Act, and treating it casually is one of the more expensive mistakes a foreign buyer can make.

What a Thai company structure actually is

A Thai limited company is a distinct legal person, with its own shareholders, directors and share capital, registered with the Ministry of Commerce. For the company to be treated as Thai for land-ownership purposes, Thai shareholders generally need to hold the majority of the shares, and foreign shareholding and voting control are subject to limits under the Foreign Business Act. The company then owns the land as a company asset, and the foreigner’s interest is in the company — as a minority shareholder, and often as a director with day-to-day management authority — rather than in the land directly.

The nominee problem

The structural weakness that gets exploited is straightforward: if the Thai shareholders are not real investors — if they put in no genuine funds, receive no genuine economic benefit, and exist on paper purely to satisfy the majority-Thai-ownership requirement while the foreigner actually controls everything — the company is a nominee structure. This is specifically what the Land Code and the Foreign Business Act prohibit, and Thai authorities have periodically run enforcement campaigns targeting exactly this pattern, particularly around land in tourist areas. Where a nominee structure is identified, the consequences can include the land being ordered sold, and the arrangement generally offers the foreign buyer no recovery of what they believed they owned — because legally, they never owned the land in the first place; the Thai nominee shareholders did.

What makes a structure genuine rather than a nominee

There is no single document that proves a company is genuine — it is a question of substance, assessed on the actual facts. Indicators that generally point toward a real structure include: Thai shareholders who actually contributed real capital reflected in the company’s accounts, a real operating business being conducted on or from the land (not merely a holding company with no activity), Thai shareholders who receive genuine dividends or economic benefit proportionate to their shareholding, and company decisions genuinely requiring the Thai shareholders’ involvement rather than being a formality. A company set up purely to hold one residential property, with no business activity, Thai shareholders who never contributed funds and never see a return, and a foreigner making every decision alone, looks like a nominee structure regardless of what the paperwork says.

Ongoing compliance a company involves

A company is not a one-time setup — it is an ongoing legal entity with obligations a straightforward personal purchase does not carry:

• Annual accounting, audit and financial statement filing requirements.
• Company registration and annual filing fees with the Ministry of Commerce and the Revenue Department.
• Corporate income tax on any company income, distinct from personal property tax.
• Proper corporate governance — shareholder meetings, board resolutions for major decisions — that needs to actually happen, not just exist on paper.

Factor these ongoing costs and administrative obligations into any genuine comparison between a company structure and a lease or usufruct arrangement — see taxes & fees and mortgages & financing for how a company structure changes the financial picture.

When a company structure makes sense

A company structure fits situations with a genuine business rationale: operating a resort, restaurant, agricultural business, or other qualifying commercial activity where owning the underlying land as a company asset is a normal part of running that business, and where real Thai partners have a genuine stake in the venture. It fits poorly as a way to hold a single private residence with no business activity attached — for that purpose, a lease, usufruct or spouse-ownership structure is generally both simpler and legally cleaner. See land & house options for how a company compares to the alternatives.

Before you set up a company for property

• Have a lawyer assess, honestly, whether your intended structure is genuine or would function as a nominee arrangement — and be willing to hear an answer you don’t want.
• Understand the ongoing accounting and compliance burden before you commit, not after the company already exists.
• If Thai partners are involved, make sure their investment and role are real and properly documented — this protects you as much as it protects the structure’s legality.
• Get independent advice from a lawyer who is not the same person selling you the property or arranging the company formation, to avoid a conflict of interest in the advice you receive.

The Foreign Business Act licence route

Separately from the majority-Thai-shareholding route, the Foreign Business Act itself provides a mechanism for a foreign-majority or wholly foreign-owned company to obtain a licence to conduct certain restricted business activities, subject to approval and conditions. This is a distinct, formally licensed route rather than a workaround, and it is generally aimed at genuine foreign business operations rather than at holding a single residential property. Where a business genuinely qualifies, it is worth exploring with a lawyer as an alternative to a majority-Thai-shareholder structure, rather than assuming the nominee-shareholder pattern is the only way a foreign-controlled company can operate in Thailand.