You want a villa with its own plot in Phuket — and hit the rule: a foreigner can’t own land directly in Thailand. One solution is the Thai company structure. It’s legal when set up correctly, but it needs real substance and carries risks if used “for show.” Here’s how it works, how it differs from leasehold, and what to watch so the structure holds up.
Contents
1. Why land can’t be direct
Under Thailand’s Land Code, a foreigner can’t own land directly (with rare exceptions for large investments). However, a foreigner can register a building (villa) — the structure is separated from the land. So for a villa with a plot you use either a land lease (leasehold) or a Thai company.
🔗 Ownership forms: Foreigner ownership →
2. The company structure
The idea: a Thai Limited company owns the land, and the foreigner controls it. By law Thai shareholders must hold at least 51%, the foreigner up to 49%, but control is achieved via management (director) and a voting share class. The villa can be owned by the foreigner while the land sits with the company.
3. How it works
- Shareholders: ≥51% Thai, ≤49% foreigner.
- Control: foreigner as director with signing authority; enhanced-voting shares.
- Land: registered to the company.
- Villa: can be registered to the foreigner separately.
- Management: the director decides within the company’s articles.
4. Real economic substance
The key legality requirement is that the company be genuine, not an empty shell “to hold land.” Signs of a correct structure:
- Real activity or business logic (e.g. villa rental).
- Thai shareholders are real people with their own contribution, not “nominees.”
- Accounting is kept, filings are made, taxes are paid.
- Compliance with the Foreign Business Act.
An empty company with nominee Thais “to get around” the law is a direct risk.
5. Company vs leasehold
| Parameter | Thai company | Land leasehold |
|---|---|---|
| What’s registered | Land to company, villa to foreigner | Land lease 30+30 |
| Control over land | Via the company | Contractual (lease) |
| Complexity | High | Low–medium |
| Costs | Accounting, audit, filings | Minimal |
| Main risk | Nominee shareholders | Renewal terms |
🔗 More on leasing: Freehold vs leasehold →
6. Pros and cons
Pros:
- Control over land and villa in one structure.
- Flexibility on resale (sell shares/asset).
- Fits a business logic (rental, management).
Cons:
- More expensive and complex to administer (audit, filings).
- Requires real substance — otherwise a risk.
- Needs a competent lawyer and accountant on an ongoing basis.
7. Pitfalls
- Nominee shareholders. Thais “for show” with no real contribution — illegal, risk of challenge.
- Empty company. With no activity or filings the structure is vulnerable.
- Skimping on a lawyer. Wrong articles/share class strips control.
- Ignoring costs. Annual accounting and audit are mandatory.
- Copying someone’s scheme. The structure is built for the specific case.
8. Case: a nominee company
Consider a typical scenario. A buyer held a villa via a Thai company where the Thai shareholders were purely nominal — contributing no capital and taking no part, the company ran no business and filed nothing. Formally it “worked,” until at resale the buyer’s lawyer examined the structure: nominee ownership and no substance created a challenge risk and scared off the buyer.
Takeaway: a Thai company is a working tool, but only with real economic substance and a correct structure. For many buyers leasehold is simpler and safer. The choice depends on the goal and willingness to run a company.
I’ll help compare leasehold and the company structure for your villa and bring in a lawyer for correct setup.
[ Enquiry form: villa ownership structure ]
Informational only, not legal advice; build the ownership structure with a Thai lawyer.