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Pros/Cons Usufruct vs Thai Company

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20 minutes ago, CanadaSam said:

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.

 

Interesting option.  I might look into that. 

 

However, I think my wife would want to give the house to someone in her family (though we've never discussed that).  Her only living relatives are aunts, uncles, cousins, nieces and nephews, some of which we're closer to than others, some of which will likely die before either of us (aunts and uncles mostly), but I'm pretty sure she would want them to have it. 

 

The way I look at it, the only person I'm concerned about outliving me is my wife.  I wouldn't want to leave her in any sort of financial bind in her older years.  Me?  If I die last, I don't care who gets what.  I'll be dead, what do I care? 

 

I have siblings but I highly doubt that any of them would want to move to Thailand or go through the hassle of trying to sell property in Thailand.  Much easier to just give it to one of my wife's relatives both legally and logistically.   

 

But, who knows?  Thai family relationships are fickle LOL  

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19 minutes ago, Davejf2017 said:

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.  

So, I guess the plan would be to interview all of the Land Officers before we decide where to purchase 🙂 

 

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2 hours ago, GalaxyMan said:

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).

Curious as to whether or not you have asked after getting married. 

 

I could see why they might not want an unmarried Thai citizen to give control of land to a foreigner, but if you were married, does that change the math at all? 

 

 

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1 hour ago, Langsuan Man said:

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"

I've learned that things can turn ugly after someone's death having gone through that back in the US (though, never had a problem with any of my siblings, just heard a lot of stories from lawyers and trust people during the process). 

 

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32 minutes ago, snowgard said:

The company way is also ILLEGAL if it isn't a REAL company what do REAL business.

Google for more informations.

 

I understand that, but I've also been hearing that they're illegal for 20 years and nobody has really ever cracked down on them in any significant way.  I also understand that they are the primary vehicle by which rich Thais pass around assets to avoid paying taxes, so that has to also be factored into the risk matrix. 

 

The few reported cases where they have been challenged, the person is given the option of restructuring the company or changing ownership of the property. 

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20 hours ago, digibum said:

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. 

 

Not married to my other half but I have a registered usufruct.

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59 minutes ago, digibum said:

Curious as to whether or not you have asked after getting married. 

 

I could see why they might not want an unmarried Thai citizen to give control of land to a foreigner, but if you were married, does that change the math at all?

An interesting point. We haven't tried, but that's because I didn't think it was possible, having heard that an usufruct could not be given between spouses. The worst thing that could happen would be to be told NO again and waste a few hours of our time.

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1 minute ago, GalaxyMan said:

An interesting point. We haven't tried, but that's because I didn't think it was possible, having heard that an usufruct could not be given between spouses. The worst thing that could happen would be to be told NO again and waste a few hours of our time.

In doing some research I cam across a thread that IssanLawyers started and he seems to indicate that they sometimes need to go and educate the land officers on how to do it. 

 

 

The thread also seems to indicate that some land officers steer you towards a 30 year lease because it results in additional taxes.

 

It seems like if you had a good lawyer who went with you to the land Office, you might get a different answer.  It's easy to say "no" to someone that doesn't know any better.  It's an entirely different thing to say "no" to someone that knows the law. 

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My daughter, who has a Thai mum and Thai nationality, and I got a usufruct agreement at the land office. Curiously, up until that point, even though I own the building (my name is on the construction permit) because my daughter owns the land, I was technically trespassing for 13 years as I had no written permission or legal agreement to occupy her land nor any buildings on it. Usufruct sorts that one out.

 

This all came to light during the recent spate of immigration "purges", when I had great difficulty establishing an address where I lived. The IOs wouldn't accept my house as an address as it was in my daughter's land. It got very difficult, with them insisting they talk to my daughter in London at 2am. I luckily had previously used the address for an extension of stay application and still had the slip of paper in my passport, proving acceptability. All smiles again as it was they who had issued it!

 

So a usufruct is invaluable for establishing right of abode, and no hassles with meaningless leases, which I've seen more or less torn up in courts of law in Thailand. Also for yellow book applications in the absence of a lease.

 

My ¢2. YMMV!

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digibum:

 

First off – one size does not fit all. Amount, type and location of assets. Size and location of immediate and extended families. Exact location/jurisdiction local, state/provincial and federal laws. All vary.

 

I will not get into the “What If’s” “could of or Should of” discussions. I will only tell you my story.

 

American male worked in Thailand 25+ years ago. Married Thai women. Returned to the US and worked there 20+ years. Returned to Thailand for retirement. 

 

Family: immediate; myself, wife and adult daughter (dual citizen). USA family; mother, brothers, sister, daughter, nieces and nephews. Thai family; several SIL’s, BIL’s, and a large assortment of niece & nephew-in-laws.

 

Assets: US and Thai real estate, Traditional and Roth IRA’s in a managed brokerage account. Bank accounts; savings and checking, life insurance policies.

 

Immediately prior to and upon return to Thailand fact finding, exploratory and recognizance visits over the couple three years prior to pulling the plug and making the move I contacted several USA and Thai Attorneys and legal firms. Due diligence is required to select your attorneys.

 

Locations of concern: New York/New Jersey/Pennsylvania and Bangkok/Nonthaburi/Suphan Buri.

 

What I wound up with: USA Attorney and Legal Firm, Thai Attorney and Legal Firm.

 

USA Legal Documentation: Sale of Real Estate, Last Will and Testaments, Power of Attorneys, Medical Directives.

 

Thai Legal Documentation: Rental Agreements, Purchase of House, Last Will and Testaments, Power of Attorneys, Medical Directives, Usufruct. 

 

All of our legal documentation was translated into both languages. Copies of ALL legal documents, list of assets, contacts, addresses, account numbers, were provided to both sets of attorneys, our brokerage firm, and both our USA and Thai families. All participants are fully aware of our desires and wishes concerning our assets in the event of our demise.

 

My biggest concern is should I pass away first. Now my wife has both a Thai and an American Attorney to take care of everything for her. All she will have to do is sign a few papers. She has trusted family members to oversee and monitor/advise her (Thai and American – bilingual) her English skills are on par with my Thai language skills.

 

So. All my bases are covered to the best of my ability.

 

The important thing is doing your fact-finding and due diligence before you make any decisions. I spent hours talking to Lawyers/Attorneys (free consultations). You get quotations for each specific legal document your will have drawn up.

 

Good Luck.

 

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2 hours ago, digibum said:

In doing some research I cam across a thread that IssanLawyers started and he seems to indicate that they sometimes need to go and educate the land officers on how to do it. 

 

 

The thread also seems to indicate that some land officers steer you towards a 30 year lease because it results in additional taxes.

 

It seems like if you had a good lawyer who went with you to the land Office, you might get a different answer.  It's easy to say "no" to someone that doesn't know any better.  It's an entirely different thing to say "no" to someone that knows the law. 

Tried it both ways, without a lawyer at first, then with one. We were all treated rudely with incredible disrespect both times. The lawyer was shocked, as was my wife.

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30 minutes ago, The Man Who Sold the World said:

My biggest concern is should I pass away first. Now my wife has both a Thai and an American Attorney to take care of everything for her. All she will have to do is sign a few papers. She has trusted family members to oversee and monitor/advise her (Thai and American – bilingual) her English skills are on par with my Thai language skills.

 

So. All my bases are covered to the best of my ability.

 

The important thing is doing your fact-finding and due diligence before you make any decisions. I spent hours talking to Lawyers/Attorneys (free consultations). You get quotations for each specific legal document your will have drawn up.

 

Good Luck.

 

 

Appreciate that and it's good advice. 

 

Similarly, I've been looking into the estate planning side of things as well.  Recently had my father pass away and he created a great model to follow in terms of trusts and such.  I haven't pulled the trigger on doing any of that for myself yet mostly because we're (me and my siblings) are still getting things settled but my father set everything up so we got a decent amount every year for the rest of our lives. 

 

I would like to do the same for my wife with our non-Thai assets.  I trust my wife, but I'm less trusting of her family.  They're not bad people, and I generally do trust them, just not on issues involving money.  None of them have had any so I don't want them giving her financial advice (blind leading the blind).  I want to make sure she has people who actually understand investing/money guiding her. 

 

Also things like claiming spousal social security benefits when she's eligible and so on. 

 

Fortunately, I do have some good people back in the US to help.  In Thailand, I don't have that legal/accounting/investing network yet but I'm working on that too. 

 

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3 minutes ago, GalaxyMan said:

Tried it both ways, without a lawyer at first, then with one. We were all treated rudely with incredible disrespect both times. The lawyer was shocked, as was my wife.

LOL, well, not much you can do about that, I guess 🙂

 

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Some land offices are like some bank branches when it comes to farangs.  That is, some bank branches simply don't want to open an account for a farang and some land offices simply don't want to allow usufructs for farangs.  And the bank/land office will give bogus reasons as to why it's a no-can-do.  I figure it boils down to how the head person of that bank branch/land office feel about farangs.

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