Company set up

Most common types of companies in Thailand are:

These companies can be public and private.

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Thai Limited Company

This limited liability company is the most popular business entity among investors and offers protection to some degree namely:

  • The liability of the shareholders is limited to any amount left unpaid on their shares.
  • Separation between owners and management.

The incorporation of a Private Limited Company requires:

  • a minimum of three shareholders.
  • one director.
  • majority of the shares must belong to Thai citizens.
  • an auditor.
  • a memorandum of association.
  • a statutory meeting.
  • registration of the incorporation papers.

Accounting procedures specified in the Civil and Commercial code, the Revenue Code and the Accounts Act must be followed. A balance sheet must be prepared once a year and filed with the Department of Revenue and Commercial Registration. In addition, companies are required to withhold income tax from the salary of all regular employees.

Two types of shares are possible: common shares and preferred shares. Those that possess preferred shares have more rights of voting within the company. One director is elected by the shareholders. Shareholders only have the right to vote on behalf of their percentage, while the directors have the right to vote for the entire Thai company.

Check if the company name is available and reserve it if it meets the requirements set forth by the Business Development Office.

Submit the company’s Articles of Association together with a Declaration of Compliance and the relevant information about the company directors.

Register the company once all documents are in place, they are duly submitted for Commercial Registration with the Department of Business Development. The registration must take place within 30 days from the day the business started its activities.

Subsequently register for tax and VAT purposes and make the necessary submission for hiring employees.

Depending on the chosen business category, the actions described above may not be complete. The company may need to go through additional registration or licensing applications required as defined per chosen business category.

We recommend you to do a free pre-registration consultation in order to find out what the requirements will be for the limited liability company you want to register. Click the button for a free consult or fill in the form below.

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Thai Partnership

According to the Thailand Civil and Commercial Code, a partnership is “a contract whereby two or more persons agree to unite for a common undertaking, with a view of sharing the profits which may be derived therefrom.”

Generally, a partnership is established through an agreement made by the potential partners. All partners agree to invest in the establishment of a partnership prior to the commencement of a certain activity. A partner can also join an already existing partnership by either entering as a new partner or buying shares from one of the actual partners.

There are two types of Partnerships in Thailand, Ordinary and Limited. They both have 2 or more partners while the ordinary partnership has no limited partners, the limited partnership can have 1 or more. A managing partner and registration for a limited partnership is required while for an ordinary partnership they are not required.

Whilst incorporating a Partnership for Thai nationals is considered simple, partnerships for Foreigners are restricted. If a foreigner invests more than half of the overall investment or names themselves a managing partner, the Foreign Business Act. shall be applied.

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Sole proprietorship

A sole proprietorship is a business form that is suitable for those investors interested in opening a small business. In many situations, these investors may find that the business grows in time and they will need to change the business form so that it will suit the needs of their now small to medium-sized business. The sole proprietorship is a popular business form among Thai entrepreneurs. Non-Thai individuals who are married to a Thai national can open a sole trader in their name.

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Thailand encourages foreign investment

The Investment Promotion Act encourages investments through tax and non-tax incentives. For example: exemptions from or reductions of the import duties on machinery; the reduction of import duties on essential materials or raw materials; 50% reduction on the corporate income tax and others.

Non-tax incentives such as: permits for foreign nationals who wish to enter Thailand to study investment opportunities; permits to bring skilled workers and experts for certain investment promoted activities; 100% foreign ownership for some types of businesses as well as the permit to own land in some cases.

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