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ATA Outsourcing has the experience and expertise to set up any type of business in Thailand. Contact us for free advice on the best way to proceed.
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A company registration in Thailand is more complicated than in many other countries due to the restrictions on foreign ownership. There are ways to protect the foreign interest when setting up the company, and so you are best advised to consult with a law firm before set up to make sure you are proceeding in a way that gives you security, and provides the best structure going forward.
Key questions that can influence how you go forward with your company registration in Thailand include the following:
In most cases, a straightforward limited company registration in Thailand meets the business needs well, but there are other alternatives, including Representative Office, Branch Office, etc., which are listed below.
A limited company in Thailand is treated as a juristic person. As such, the shareholders are limited in their liability to the amount of capital put into the business, provided that the company is operating within the scope of its registered objectives, and the shareholders have not authorized unlawful activity.
There must be a minimum of three promoters – these can be Thai or foreigner, in any mix, but must be natural persons. These promoters are often also the shareholders, but not necessarily so. While promoters must be natural persons, shareholders can be other companies, but there must also be a minimum of three. Generally 51% of the shares must be Thai owned, but there are exceptions (below). Even if 51% of the shares are Thai owned, ATA Services can structure the company for you so that the foreign 49% maintains complete control of the company, its dividends and share transfers. Ask us to explain how this is done.
The company must have at least 1 authorised director who will sign documents on behalf of the company. There can be more than one authorised director, and the signing conditions can require more than one signature – it is up to you. The authorised director(s) can be Thai or foreign, but some business licensing, for example Tourism Authority of Thailand (TAT), requires a Thai director. A foreign director signing on behalf of the company normally will require a work permit and visa.
The company needs to register its capital when it is created, although this can be increased later for a small fee. You do not need to show the money as paid up at the time of company registration, but it will need to be included in your first annual report. You should capitalise the company according to how much it will cost you to get the company cash positive. What this amount is depends on your business plan, However, the minimum capital in order to sponsor a work permit for a foreigner is 2m Baht per person, and this should be 100% paid up. If this is a hardship for your start up business in Thailand, talk to us about possible solutions.
You should advise your law firm of all your company objectives prior to registration. These objectives are in reality a statement of business activity, e.g. exporting of dried banana, and you should have a statement for each activity. Your law firm can then advise you accurately on any restrictions or licensing that may apply. ATA Services will give you this advice for free in an initial consultation.
The company will need a commercial (not residential) address when registering. ATA Services provides virtual office solutions and flexible physical offices at our two Bangkok business centers if you need a starting point. Once the company employs Thai nationals (a requirement for sponsoring a work permit), a suitable physical office is required to register them for Social Security – the office will be inspected! Some business activities requiring licenses need the registered office to meet additional requirements. Whatever office you require, the land owner must be willing to provide signed copies of ownership documentation if your company needs to register for VAT with the Revenue Dept. As we own our business centers, ATA Services readily makes available the necessary documentation.
Opening a company in Thailand as a foreigner involves several steps and considerations. The process can vary based on the type of company you want to establish and your specific business goals. ATA outsourcing part of the ATA Services group will help you to go through the entire process.
Here’s a general outline of the steps you would need to take:
Choose the Type of Company: Decide on the type of company you want to establish. Common options for foreigners include a Limited Company, a Representative Office, a Regional Office, a Branch Office, or a Joint Venture. Each type has different requirements and restrictions.
Business Activities and Licenses: Determine the nature of your business activities and any licenses or permits required to operate legally in Thailand. Certain businesses may require specific licenses or approvals from relevant government agencies.
Minimum Capital Requirements: there is no minimum capital to setup a company. It’s important to note that, you should still carefully consider the actual capital you’ll invest to ensure the stability and credibility of your company. Additionally, certain business activities might have specific capital or investment requirements based on regulations and industry standards.
The capital can be used for company expenses.
Foreign Business Act (FBA) Restrictions: Depending on your business type and activities, you need to ensure compliance with the Foreign Business Act. Some business sectors have restrictions on foreign ownership, and certain activities might require special permission.
Company Name Reservation: Reserve a unique company name with the Department of Business Development (DBD) to ensure it’s available and complies with Thai naming rules.
Articles of Association: Prepare the company’s Articles of Association (AoA), which outlines the company’s structure, objectives, shareholders’ rights, and other relevant details.
Shareholder Requirements: If you’re setting up a Limited Company, you’ll need at least two shareholders. At least 51% of the company’s shares must be held by Thai nationals, while the remaining shares can be held by foreign individuals or entities.
Registered Office Address: You must have a registered office address in Thailand where official documents can be sent and received. Our company can provide your company address in one of our business centers.
Register the Company: Submit the necessary documents, including AoA, shareholder details, and other required forms, to the Department of Business Development to officially register your company.
Tax Registration: Register for tax identification numbers and comply with tax regulations, including VAT, corporate income tax, and other applicable taxes.
Work Permits and Visas: If you plan to work in Thailand as a foreign director or manager, you’ll need a work permit. Ensure you and any foreign employees have the appropriate visas and work permits.
Per foreigner, you will need a ratio of 4 Thai employees and a capital of 2MB. Our company can help you with all work permit visa processes.
Opening Bank Accounts: Open a business bank account in Thailand for your company’s financial transactions.
Compliance and Reporting: Stay compliant with Thailand’s business laws and regulations, and fulfill reporting requirements, including annual financial statements and tax filings.
ATA outsourcing proposes, accounting-payroll-audit services.
It’s crucial to work with experienced legal and financial advisors who are knowledgeable about Thai business regulations. The laws and requirements can change, so consulting with professionals can help you navigate the process smoothly and ensure your business is set up correctly.
Within our group, we have lawyers, a financial controller, accountant manager who can help for setting us your business in the right direction.
Value Added Tax registration – When you company has more than 1.8 million in revenue in one financial year, you are required to register with the Revenue Dept. for Value Added Tax (VAT), but you can also register immediately to have your company in the Revenue Department record, so that you can offset VAT paid against VAT charged. The VAT rate is 7% and monthly reports need to be submitted and paid. The monthly report is called a PP30, and it is one of the documents required to get your Visa and Work permit.
| Gross Profit (THB) | Tax Rate |
| Not more than 300,000 | Exempt |
| More than 300,000 but not greater than 3,000,000 | 15% |
| More than 3,000,000 | 20% |
For executives on high salaries, corporate income tax can be a lot lower than personal income tax, which, for example, can be as high as 35% on an income of THB 5m
Withholding tax – Every payment the company makes requires that 3-5% withholding tax be deducted on transactions within Thailand. Foreign companies submitting invoices will also be deducted withholding tax, and this can be a much higher rate on service contracts. When you deduct you have to report and submit that money to the Revenue Department. Your Thai supplier can claim it at the end of the year, and foreign suppliers in countries with dual-taxation agreements can also offset against income tax.
ATA Outsourcing has the experience and expertise to set up any type of business in Thailand. Contact us for free advice on the best way to proceed.
ATa Outsourcing is a One Stop Solution for companies, providing Corporate, Accounting, Immigration and Legal Services, for Thailand. A professional solution to fit all your business needs.
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