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Pros/Cons Usufruct vs Thai Company

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I'm approaching this from a slightly different perspective than I've seen in previous threads so bear with me. 

 

Been with the wife over close to a dozen years, solid marriage, still happy (as is she - or so she tells me, haha).  Live together in Thailand, back in the US for awhile, and now back in Thailand to retire. 

 

We've been thinking about buying a place.  My biggest concern about putting the property in her name is if she were to die before me.  I don't want to be forced into a fire sale and take some stupidly low offer just because I can't legally own the land. 

 

First thought was to buy the land/home in her name and that she would give me a 30 year lease on the property.  If she dies before me, I can sell it for nothing in exchange for a new 30 year, which by the time it expires, I should no longer be around either. 

 

Even if I can't get someone to give me the 30 year lease, assuming my wife doesn't die tomorrow, actuarily speaking, I would probably be gone or close to it by the time the first 30 year lease expired anyway (I'm assuming we can renew the lease every 5 years or so to keep the 30 years rolling and I have 25 - 30 years after the date of her death). 

 

And if our marriage did go to bad (I don't see it happening, but never say never, right?), I still have a lease on the land, presumably, for the rest of my life. 

 

The other thought was to buy it via a Thai company with my wife as 51% owner and me as 49% owner.  If she dies, I can always split the ownership up across enough people that don't know each other or use nominee shareholders to hang on to the land until I kick the bucket. 

 

And if our marriage did go bad, it seems like the worst situation I would be in would be that I would get 49% of my money back if she wanted to sell it.  Of course, I guess, she could also evict me for the land or demand a rent so high it didn't make sense, but I'm thinking that maybe I could force the sale of the land or a buyout of my stake in the company as part of the divorce settlement, but maybe that's wrong. 

 

Or is it something in between?  Like do the 30 year lease option and then if she died, move it into a Thai company with nominee shareholders?

 

We don't have any kids, so I don't really care what happens after I die (unless I die before her, in which case, I want her to have everything).  So, pros or cons based on passing on anything to relatives or children isn't really that important.   

 

Anyway, I was just looking to see if there were other pros and cons to each option (or other options I haven't considered). 

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The title of your post mentions usufruct, yet you only talk about leasing. To the best of my understanding, a spouse cannot give a farang an usufruct; a lease, yes.

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1 hour ago, GalaxyMan said:

The title of your post mentions usufruct, yet you only talk about leasing. To the best of my understanding, a spouse cannot give a farang an usufruct; a lease, yes.

Who can offer a usufruct to a farang?  Or can farangs not enter into one?  I was under the impression that anyone could be party to a usufruct, at the discretion of the Land Office. 

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1 hour ago, Peterw42 said:

Anyone can get a userfruct but any agreements between husband and wife become null and void if you get divorced, probably the main reason you want the protection of a userfruct.

The usufruct only remains valid if it was issued before the marriage took place. I'm not even sure if they'll issue one if you're married and receiving it from the spouse.

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Pros and cons of the company approach

 

Pros.

You are always in control. This assumes that it is structured to give you 100% voting rights.

Cons

1) You will have to audit every year -about 10/12000 Baht per annum.

2) When you pass on (assuming that you will the company to your wife). Your wife will have to pay the transfer charges from company name to her name.

3 ) With 2 complete she will have to close down the company -expensive .

 She could of course leave it in the company. The will will give her your share allocation and voting rights.

But then audit fees have to be found -every 12 months

 

Another pro

If she wishes to sell the company /house to a foreigner(beyond your death) then this process is easy and cheap.

Edited by Delight
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15 hours ago, GalaxyMan said:

The usufruct only remains valid if it was issued before the marriage took place. I'm not even sure if they'll issue one if you're married and receiving it from the spouse.

Was married (and still married) when the Thai wife and I bought our house/dirt here in Bangkok and I have a Usurfruct on the chanote.

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22 minutes ago, Pib said:

Was married (and still married) when the Thai wife and I bought our house/dirt here in Bangkok and I have a Usurfruct on the chanote.

That's very interesting and good for you. Here in Samui, the guy who runs the land office has told me/us in no uncertain terms, twice, NO USUFRUCT FOR FARANG! This was before we were married.

 

Probably the hardest part of coming from the 'civilized' West, at least in legal terms, is the reality in Thailand that laws are only advisory, to be interpreted or enforced however they wish (or not at all).

Edited by GalaxyMan

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Once again it all depends upon which Land Office you have to deal with.  Just like Immigration or an IO at the airport.  Everybody with a little bit of power in this country likes to feel special and interpret the laws or regulations as they see fit

 

Some IO's treat usefruct's the same as any contract in Thailand between husband and wife, not valid.  Others have no problem with allowing them on the Chanote

 

But having a usefruct after your spouse dies doesn't guarantee you that the relatives, who feel that they are entitled to the property, will not make your life miserable trying to enforce your "rights" 

 

The usefruct really doesn't give you protection, your ability to continue to pay for the property maintenance, taxes, and fees is really what give you control 

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11 hours ago, topt said:

Perhaps he just wants to use some collective ideas to find out some options he may not have considered and would not have thought of asking the "real live Licensed Attorney......." when he eventually gets round to asking them....

At least it may give him a data check.  

 

This is pretty much the plan.  I am just trying to get an idea of what the obvious pros and cons might be and see if I'm missing something.  Obviously, I would consult with a lawyer before going either route to make sure all of the i's are dotted and the t's crossed.  I don't want either myself or my wife to get some shocking news when one of us dies. 

 

It's also helpful to see the various advice given because it helps form the questions I can ask the lawyer. 

 

Often times, you can read about a lot of this stuff, but some minor twist in your circumstances changes everything.  For instance, I don't think I read anywhere that a husband and wife could not enter into a usufruct.  There seems to be some debate about that, but I had no idea it was even a question. 

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It seems to me, that you really don't care about the value of the property, or what happens to it, after you and your wife passes away.

 

If this is the case, then why not simply gift it to a charity organization, and then take a perpetual lease on it for a very small sum of money, with said lease to only expire or be non-renewable in case of both your deaths?

 

I am not a legal expert, but it seems logically to be do-able, with a good lawyer involved.

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13 hours ago, Delight said:

Pros and cons of the company approach

 

Pros.

You are always in control. This assumes that it is structured to give you 100% voting rights.

Cons

1) You will have to audit every year -about 10/12000 Baht per annum.

2) When you pass on (assuming that you will the company to your wife). Your wife will have to pay the transfer charges from company name to her name.

3 ) With 2 complete she will have to close down the company -expensive .

 She could of course leave it in the company. The will will give her your share allocation and voting rights.

But then audit fees have to be found -every 12 months

 

Another pro

If she wishes to sell the company /house to a foreigner(beyond your death) then this process is easy and cheap.

No, just change director to her and have a friend send it to her if you die.... 

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I went to my local land office and got my name put on the Channote usufruct for the rest of my life.So if my  wife dies before me I am not forced to sell the house and the cost for doing this was 130 baht.  

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