Thai Company Structure for Villa Purchase: Risks and Alternatives

One of the most frequently asked questions by foreign villa buyers in Phuket: “Can I use a Thai company to buy a villa and get freehold ownership of the land?” The short answer is: technically yes, but with significant legal risk — particularly if nominee Thai shareholders are used.

This guide explains how Thai company structures work, what the risks are, and what the safer alternatives look like in 2026.

Why foreigners use Thai companies for villa purchases

Under Thai law, foreigners cannot own land directly. Condominiums are the exception (via the Condominium Act). For everything else — land, houses, villas — foreigners need an alternative structure.

A Thai limited company can own land (including the land under a villa). If a foreigner owns the majority of a Thai company — or even a minority stake — they can gain de facto control of a land-owning company.

The appeal: unlike a 30-year leasehold that shrinks over time, company-owned land is theoretically permanent freehold.

How the Thai company structure works (in theory)

A typical structure:

1. A Thai Limited Company (บริษัท จำกัด) is formed
2. The company must have at least 3 shareholders
3. At least 51% of shares must be held by Thai nationals under the Foreign Business Act
4. The foreigner holds up to 49% of shares (within the foreign business cap)
5. The company purchases the land and villa
6. The foreigner controls the company through preferential share classes, voting rights structures, or directorship

The nominee shareholder problem

In practice, many Thai company structures use nominee shareholders — Thai nationals who hold shares on paper but have no real beneficial interest in the company (they act on the foreigner’s instructions, sometimes in exchange for a small fee).

This is illegal. The Foreign Business Act B.E. 2542 and the Land Code B.E. 2497 explicitly prohibit using nominee shareholders to circumvent foreign land ownership restrictions. Specific offenses:

• Using Thai nominees to hold land for foreigners
• Disguising foreign land ownership through dummy shareholding
• Facilitating or enabling the above

Penalties can include:

• Fines
• Criminal prosecution of the Thai nominees and the foreigner
• Forced disposal of the property (the company loses the land)

The Land Department and Department of Business Development periodically conduct investigations. Properties with nominee structures are at risk of investigation and forced disposal — regardless of how long they’ve been held.

Are there legitimate Thai company structures?

Yes, but they require real Thai shareholders with genuine beneficial interest:

Legitimate structure characteristics:

• Thai shareholders are genuine business partners or investors with real equity stakes
• They are not “nominees” — they have real rights in the company and can enforce them
• The company has legitimate business operations (not purely a property holding company)
• The company’s articles of association, shareholder agreements, and management structure are proper

This is achievable — but it requires genuine Thai business partners, not hired nominees. For most individual foreign villa buyers, finding and maintaining a legitimate Thai business partnership structure purely for a property holding is complex.

Practical alternatives to Thai company structures

1. Leasehold (most common)

A 30-year registered lease on the land, with the building (villa structure) owned separately by the foreigner.

Why it works:

• Fully legal and explicitly recognized under Thai law
• Registered at the Land Department — protected, enforceable
• Can include renewal clauses (though automatic renewal is not guaranteed by law)
• Transfer (sublease to a new buyer) is possible with landowner consent

The limitation: After 30 years, the lease must be renewed by agreement with the landowner. If they refuse, you lose the right to the land (though your ownership of the structure complicates the situation). In practice, 30-year leases in Phuket are routinely renewed — the landowner loses the asset if they don’t cooperate with renewal.

Lease renewal tip: Structure lease agreements to include a right of first refusal to purchase the land (should the law change) and pre-agreed renewal terms at a fixed rent or formula. Your lawyer should negotiate this before signing.

2. Usufruct

A usufruct is a legal right to use and benefit from land for a fixed term or for life. It is registered at the Land Department and provides strong protection.

Key features:

• Can be registered for a person’s lifetime (lifetimelong usufruct) — stronger than a 30-year lease for older buyers
• The usufruct holder can rent out the property and collect income
• Non-transferable — dies with the usufruct holder (unlike a lease which can be subleased)

When it’s appropriate: Older buyers who want security for their lifetime without worrying about lease renewal.

3. Superficies

A right to own buildings on another person’s land, registered at the Land Department for up to 30 years. Less commonly used than leasehold but provides an additional legal basis for villa ownership.

4. Purchase of registered condominiums (avoid villa entirely)

For buyers whose primary goal is investment and who don’t need a private pool villa specifically, purchasing a freehold condominium avoids the entire Thai company / leasehold complication. Pool-access condos at Skypark Elara or similar projects provide resort-lifestyle amenities within a clean legal structure.

What to do if you already own a Thai company structure villa

If you already hold a villa through a Thai company with nominee shareholders:

1. Do not panic, but do plan: The risk exists but investigations are not universal. However, the risk profile has increased in recent years.
2. Consult a specialist lawyer immediately: An experienced Thai property lawyer can assess your specific structure and advise on remediation options.
3. Options for regularization:
   • Convert to a legitimate partnership structure with real Thai co-investors
   • Convert the structure to leasehold (surrender the company’s title, enter a registered lease)
   • Sell the property (while the structure is still intact and the risk hasn’t materialized)

Summary

Thai company structures for villa ownership exist on a legal spectrum from clearly legitimate (real Thai partners, proper business structure) to clearly illegal (nominee shareholders). Most foreigner-held Thai company villas in Phuket use nominee shareholders — placing them in the risky category.

The safer approach for most foreign villa buyers in 2026: A properly negotiated 30-year leasehold with renewal provisions, registered at the Land Department, reviewed by an independent lawyer. This is fully legal, enforceable, and provides the security most buyers need for a reasonable holding period.

Frequently Asked Questions

Can I use a Thai company to buy a villa and own the land? +

Technically yes, but using Thai nominee shareholders (Thais holding shares for the foreigner with no real equity) is illegal under Thai law. A legitimate company structure with real Thai business partners is legal but complex. Most lawyers recommend leasehold as the safer and cleaner alternative for individual foreign villa buyers.

Are nominee shareholder Thai companies legal for property ownership? +

No. Using Thai nominees to circumvent land ownership restrictions is explicitly illegal under the Foreign Business Act and Land Code. Penalties can include fines, criminal prosecution, and forced property disposal. The risk of investigation has increased in recent years.

What is the safest way for a foreigner to buy a villa in Thailand? +

A 30-year leasehold registered at the Land Department with a properly negotiated renewal clause is the safest structure for most foreign villa buyers. It is fully legal, registered and enforceable, and transferable. Combined with a usufruct for the building structure, it provides strong protection.

How long does a Thai property leasehold last? +

Thai registered leaseholds are capped at 30 years per registration. Renewal for another 30 years requires a new agreement with the landowner — automatic renewal is not guaranteed by law, but is typically negotiated contractually. After 60 years, another renewal negotiation is required.

What happens to my villa after the 30-year lease ends? +

The lease must be renewed by agreement with the landowner. If they refuse, you lose your right to the land — though you retain ownership of the building structure (villa), which creates a complicated situation. Well-drafted leases include pre-agreed renewal terms and rights of first refusal to purchase the land if Thai law changes to allow it.

Related guides

• Freehold vs leasehold in Thailand: complete guide
• Phuket condo vs villa: which should you buy?
• Do I need a lawyer to buy property in Thailand?
• Buying property in Phuket: complete guide
• 7 biggest mistakes when buying property in Phuket