Wills & Inheritance in Thailand

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Wills & Inheritance in Thailand

Having a will is important to ensure that on death, a property passes to those of the deceased choice, in the most tax effective way.

The Civil and Commercial Code has: 

1. Requirements for a valid will, and 
2. The rules for distribution of property on death where no will, or no valid will, has been made (intestacy).

Wills

For a will to be valid in Thailand, it must be made in compliance with Thai law. It is always advisable to seek a lawyer's advice.

• To make a will, a testator must be at least 15 years of age and have full mental capacity
• A will can be changed at any time before the testator's death
• If a person makes a will, and then subsequently marries, the will remains valid under Thai law
• A will can be written in Thai or English. A will made in the Thai language is not essential, but can speed up the administrative process. The Thai courts accept wills made overseas, but they must be translated into Thai before they can be presented to a Thai court
• Generally, a will should be signed by the testator in the presence of two witnesses
• Under Thai Law, applying for a grant of probate is not necessary unless the owner of an asset to be transferred requires it or there is a dispute regarding the will or the gifts it contains  
• A will should always be kept in a safe place, if not in the testator's own possession, it may be wise to store it in a bank deposit box, or with a lawyer

The time it takes to administer an estate varies, depending on the nature of the assets and whether there is any dispute concerning the will, or the gifts it contains. If the executor or beneficiaries are foreign it will help speed things up if they employ a Thai law firm.

There is no inheritance tax or death duty in Thailand. But if land or buildings and certain other assets have to be transferred to beneficiaries, then Land Department fees and other fees or taxes are payable.

The deceased's funeral must be arranged by the person appointed as executor in the will or another person who is specifically appointed to do so. Expenses for arranging the funeral can be claimed as stated in the law.

Note: It may be preferable for a person to make separate wills to apply in each country in which they own assets. For example, if separate wills are made for assets in the UK and Thailand, then it can speed up the process of estate administration in Thailand.

The form of a will

A will must be prepared as prescribed by Thai law. In general, a will must be in writing, dated and signed by the testator and at least two witnesses who are present at the same time as the testator signs and also in each other's presence. An oral will may be made in time of war, and there are other special rules that apply in such a case.

It is possible for a testator to write their own will. This is called a holograph will. This form of will must be signed and dated by the testator but it does not have to be witnessed. If the will has been written or typed by a person other than the testator, then that person must sign the will as well. Special rules apply in cases where the testator is blind, mute, deaf or illiterate.

The testator does not need to reveal the contents of the will to witnesses, unless this is required by law. Certain persons are ineligible to be witnesses:

• A beneficiary under the will
• A person unable to manage his own affairs
• A person with mental incapacity
• A deaf, dumb, or blind person

A will can be made by the testator in the District Office (Amphur or Khet) and a record of such a will remains secret during the testator's lifetime.

A will may be altered by making a subsequent will or a codicil. This should state whether the first will is totally or only partly revoked. The rules for signing a subsequent will or a codicil are the same as for executing the original will.

Trusts

Trusts do not exist in Thai law. If a testator wants to bequeath property to a person under 20 (the age of majority in Thai law) this can be effected by asking the executor to hold the property for the minor beneficiary, or appointing a guardian to hold the property for the minor until they reach majority. The executor or guardian can be given certain powers to manage property or invest money.

Inheritance

In general, all kinds of property, rights, duties and liabilities can be included in the inheritance.

Usually, the beneficiary is entitled to receive all property that they are bequeathed under the will. However, there are special rules that apply to foreigners owning land, so if a foreigner is bequeathed land the consent of the Interior Ministry must be obtained before they can claim it. This may be granted in certain cases, but if permission is refused, then the land must be sold within one year (and the cash can be transferred), or the land transferred to a Thai national.

In the case of a condominium, the ownership is transferable to a foreigner provided that the total number of condos owned by foreigners in that particular development does not exceed 49 percent. If it does then it must be sold within one year or transferred to a Thai national.

Where a person dies without having made a valid will (Intestacy)

If a person dies without having made a valid will, or if the will only disposes of part of their estate, then the property is distributed in the following ways:

There are six classes of statutory heirs. These are mutually exclusive, and entitlement applies in descending order:

1. Children
2. Parents
3. Brothers and sisters 
4. Half-brothers and sisters 
5. Grandparents
6. Uncles and aunts

Where a spouse survives:

• If the deceased leaves a spouse and children, then the spouse takes 50 percent and the children take 50 percent in equal shares.
• If the deceased dies leaving a spouse and parents, then the spouse takes 50 percent and parents take 50 percent in equal shares.
• If the deceased dies leaving a spouse and siblings of the whole blood, then the spouse takes 50 percent and the siblings take 50 percent in equal shares.
• If the deceased dies leaving a spouse and heirs in classes, 4,5 or 6 above, then the spouse takes two thirds of the estate and the statutory heirs in the class entitled take one third in equal shares.
• If there are no statutory heirs in existence, the surviving spouse takes the whole estate.

Where there is no surviving spouse:

Where a person dies leaving no surviving spouse, then the class of statutory heirs entitled takes the whole of the estate in equal shares. For example, if a person dies leaving no spouse but children, then the children take the whole estate in equal shares. If a person dies leaving no spouse or children but leaving parents, the parents take the whole estate in equal shares.

Where the deceased is a director or shareholder in a company

Where the deceased owned shares, these are not automatically transferred to the beneficiaries. This would be considered by the Board of Directors who may have discretion to refuse a request for transfer under the articles of association. If the nature of the business is restricted under the Foreign Business Act, then a transfer may be refused if its effect would be that foreign ownership of the business would then exceed 49 percent. In such cases the shares may have to be sold or transferred to a Thai person. For these reasons it is advisable to have more than one director in the company, so that management may be continued without disruption.

If a deceased foreigner is the director of a Thai company, the directorship does not pass to their heirs.

Prepared by: Stephen Frost, Director, Bangkok International Associates
17th Floor ITF Tower, 140/36-37 Silom Road, Bangkok 10500, Thailand
Tel: 02 231 6201-3 Fax: 02 231 6204 /e-mail /Website
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