With the rise of platforms like Airbnb, property owners in Thailand are often tempted to offer short-term rentals to tourists. However, leasing a property for a period of less than 30 days without the proper license is considered an illegal act in Thailand. This practice violates several key laws and exposes developers, owners, and property managers to severe legal and financial consequences.

This guide provides a clear overview of the legal framework governing short-term rentals in Thailand and outlines the risks associated with non-compliance.

1. The Hotel Act (B.E. 2547) and Its Implications

The primary law governing short-term accommodation is the Hotel Act, B.E. 2547 (2004). According to this act, any property offering paid lodging for periods of less than 30 days is legally defined as a “hotel” and requires a hotel business license to operate.

Operating without this license is a criminal offense. The penalties for violating the Hotel Act include:

• A fine of up to 20,000 THB.
• Imprisonment for a term of up to one year.
• An additional daily fine of up to 10,000 THB for each day the violation continues.

This law is the main reason why daily or weekly rentals in private condos and houses are generally illegal.

2. The Condominium Act and Community Regulations

For condominium projects, the Condominium Act, B.E. 2522 (1979) empowers the building’s juristic person (management office) to establish internal rules to protect the safety, security, and harmony of the residential community.

Most condominium regulations explicitly prohibit daily and weekly rentals. If a developer or owner ignores these rules and allows short-term lets, they can face penalties imposed by the juristic person, which may include:

• A fine of up to 50,000 THB.
• An additional daily fine of up to 5,000 THB for ongoing violations.

3. Tax Evasion and Legal Liability

All income generated from renting out a property in Thailand is subject to personal or corporate income tax. Failing to declare this income is considered tax evasion, a serious offense that can trigger an investigation by the Thai Revenue Department. The consequences can include substantial back-taxes and hefty fines.

4. Community, Security, and Property Value Concerns

Allowing unauthorized short-term rentals creates significant practical problems that can harm the community and the property’s value:

• Increased Security Risks: The constant turnover of unregistered short-term guests places a heavy burden on building security and makes it difficult to monitor who has access to the property.
• Disruption to Community Harmony: Short-term tourists are often unfamiliar with community rules, leading to issues with noise, improper garbage disposal, and misuse of common facilities. This can disrupt the lives of long-term residents and lead to complaints.
• Decline in Property Value: A building known for transient occupants and management issues can lose its appeal to long-term residents and serious investors. This negative reputation can directly lead to a decline in the property’s market value.

5. The Legal Alternative: Monthly (30+ Day) Rentals

In contrast to the risks of short-term lets, renting a property for 30 days or more is fully legal and compliant with Thai law. This type of lease is considered a standard residential rental and falls outside the scope of the Hotel Act.

To ensure full compliance when offering monthly rentals, owners should:

• Use a formal lease agreement that clearly outlines the rights and responsibilities of both the landlord and the tenant.
• Declare all rental income to the Revenue Department and fulfill all tax obligations.
• Adhere to all community and building regulations, including registering tenants with the property management office.

To avoid the significant legal and financial risks associated with illegal short-term rentals, property owners and developers in Thailand should strictly adhere to the country’s laws.

The safest and most straightforward approach is to offer leases for 30 days or longer. If there is a strong business case for short-term rentals, the only legal path is to undergo the complex and costly process of obtaining a proper hotel license. For most individual property owners, this is not a feasible option.

By prioritizing legal compliance, you not only protect yourself from severe penalties but also contribute to a safe, stable, and valuable residential community.