Usufruct is a legal document as per Thai law that provides one person with the full right use a Thai property of another. The foreigners get lots of benefits with a Usufruct and enjoy the land usage. Usually, in Thailand, the foreigners are not allowed to own a land and in such circumstances if a foreigner wish to purchase a land or want to enjoy the rights to use it, then Usufruct rights are very helpful. The trend of using Usufruct rights have increased in Thailand over the past few years and many foreigners are making use of it to get the land rights.
Rights enjoyed with a Usufruct
A person is said to be enjoying a right in property or real estate that is owned by another person for a certain period of time or until death. This right to use the property is termed as Usufruct. If you are a foreigner and want to get a Usufruct, then you will enjoy the rights of using the property like the earnings and fruits that the property generates. You can rent out the property and get the rents without any need to share the earning with the real Thai property owner. With Usufruct, you can enjoy al the rights except for the right of selling it off or destroying it. There are very few instances where people use Usufruct for the residential purpose; mainly, this Thai law is used to collect the benefits that the land generates such as the earnings from the agricultural products. In Thailand, there is a similar law that provides the right only for habitation, known as a right to habitation in Thailand.
Benefits of Usufruct
There are several advantages of using a Usufruct. Owning a land is not allowed to the foreigners in Thailand except for two situations: when the land is acquired as a legacy from a Thai resident (for residential land, it cannot exceed above one rai) and when 40 million baht is invested into the kingdom. With Usufruct, a foreigner can enjoy all the property rights for a long period of time.
Disadvantages of Usufruct
When you are enjoying Usufruct right of a property in Thailand, you cannot transfer or sell the land and it is not inheritable also. Also, you cannot build or conduct any major change on the property. The right of Usufruct is very limited in comparison to the lease agreement in Thailand.
A lease agreement is valid for thirty years in Thailand and after that if both the owner and the lessee further want to expand the term, they have to enter a fresh contract and prepare an agreement for another 30 years. However, there is no guarantee that after 30 years the owner of the property will be alive or not. Therefore, Usufruct in Thailand has its own share of advantages that makes in quite popular among the foreigners.
If you want to know more about the legal issues related to Usufruct in Thailand, you can contact our law firm and consult with the best of lawyers.