loader image

Company Registration in Thailand

Register your company in Thailand fast & hassle-free!

Navigating company registration in Thailand can be a complex journey, given its unique restrictions on foreign ownership. However, with the right guidance, securing your foreign interests and establishing a solid foundation for your business is entirely achievable. Consulting a knowledgeable law firm is your first critical step to ensure that your setup aligns with legal requirements while safeguarding your interests.

Speak to our team!

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.

 
 






    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.

    To set up a limited company in Thailand, there are five critical considerations:

    1- Shareholders

    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.

    2- Directors

    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.

    3- Minimum capital

    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.

    4- Business objectives

    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.

    5- Registered office

    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.

    You are strongly advised to consult with a commercial law firm, who is experienced at setting up all kinds of business, prior to registering the company to explain your needs. While things can be ‘fixed later’, it is important that you have a full understanding of the issues, requirements, costs and options from the outset. Foreigners particularly need advice on the structuring of their company in order to protect their investments. Take advantage of our free consultation.

    Process of a Company Registration in Thailand

    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.

    Company setup options in Thailand

    Partnership

    Is a very common juristic person, with a minimum of two persons. It can be registered with unlimited liability (ordinary partnership) or limited liability (limited partnership). This arrangement is not recommended to foreigners due to both the complexity and reluctance for officials to recognize it.

    Branch Office

    Unlike an RO, a registered branch office of a foreign company can invoice. However, as it is a foreign owned trading business it does require specific licensing and approval – a process that is lengthy and costly. As a branch office has no shareholders, the head office becomes liable for all activities of the Thailand branch office.

    Amity Company

    US persons (natural or juristic) can be majority shareholders in a Thai limited company. This requires additional procedures and documentation, slowing down the process, but licensing is granted provided the business is not restricted under foreign business law.

    Representative Office

    A foreign company can consider opening a representative office (RO). This can save costs and legal ownership complications, as a Thai partner is not required. An RO can sponsor work permits for up to two foreign staff. The head office needs to send funds to Thailand to cover the RO’s expenses, e.g. rent, salaries, etc. The downside to an RO is that it cannot invoice. It can support the business activities of head office, but the invoicing and payment must be handled by head office.

    Foreign owned limited company

    This is the same as a Thai limited company but with a majority of shares foreign owned. You can register this business, but you cannot trade until obtaining a Foreign Business License, which involves providing evidence that the company does not fall within the list of restricted activities and that it will provide benefit to Thai society and economy. The process can take 3-6 months, and the outcome is not guaranteed.

    Board of Investment (BOI) promoted company

    The BOI allows Thai limited companies to be foreign owned if the activities fall within the list of businesses it is willing to promote. BOI certification comes with a range of benefits in addition to foreign ownership, including tax relief and granting of multiple work permits and visas. The process is relatively complicated and involves one or more interviews with company directors. Contact us if you want to know whether your business falls within BOI promotion.

    Thai Limited Company

    As explained above, this is the most common business type in Thailand for locals and foreigners. This type of business structure is reliable, secured, and easy. The Thai Limited Company is very similar to other business structures in your home country with shareholders, directors, and other considerations… A Thai Limited Company may need licenses to work in certain sectors.

    Other essential information before setting up a business

    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.

    Corporate income tax – In Thailand companies can choose their financial year, so that if you register the company in the month of September, your financial year can be September 1st to August 31st. At the end of the financial year, a report must be prepared and submitted for tax payment. The corporate income tax is calculated thus:
    Gross Profit (THB)Tax Rate
    Not more than 300,000Exempt
    More than 300,000 but not greater than 3,000,00015%
    More than 3,000,00020%

    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.

    Social Security Fund – When the company has an employee, the company and the employee must register in the social security system within 15 days after starting. Also, the company must report all the resignations and terminations of employees within 15 days from the end of contract. When you pay salaries to employees, you have to make deductions and report to Social Security Office (SSO) monthly. The company matches the employee contribution. ATA Services can help you with payroll services and do the reporting for you. Directors cannot register in the SSO system. Sponsoring a work permit and visa for a foreigner requires four Thai employees registered in the SSO per foreigner.
     
    Accounting – A company must do accounting, even if trading is zero. At the very least and annual audit is required, which must be done by a registered Thai CPA. When your company is registered for VAT, has transactions of payments or has employees, the accounting need to be completed every month and a tax report submitted to the Revenue Department – without accounting you cannot calculate the tax. ATA Services offers full accounting services.
     
    Intellectual Property (IP) – In Thailand there are three main types of IP protection, which are copyright, Patent, and Trademark. Only Patent and Trademark can be registered. Copyright cannot be registered, but you can notify the DIP. To register your trademark, the trademark needs to match the numerous conditions under Thai Trademark Law, and must not be similar to any previously registered. The process takes a least 3-6 months when no one objects, but if someone does object, the process can take more than a year because you have to fight to get the trademark. Note that tradenames cannot be registered in Thailand – this is something to consider when deciding your company name. If the name of the company contains your trade name, then you have protection from others using it in Thailand.
     
    Legal protection and Compliance – In Thailand, there are more than 1000 statutes and thousands of regulations regulating a business. You will require a commercial lawyer who understands your business to advise you and represent you in all legal matters. Make an appointment today to get to know our lawyers at ATA Services.
     
    Labour matters – Labour protection law in Thailand has peculiarities you may not be aware of. You should always consult with a lawyer on calculation of commission payments, overtime, severance pay and termination procedures. Let ATA Services help you draft your statutory work regulation documents and advise you on employee negotiations.
     
    Dissolution of a company – The process of closing a company is long and complicated – you will certainly need to visit a lawyer and accountant. The lawyer will work on your documents and applications to dissolve your company. In the case that you never submitted the financial report, you need to pay the fine and submit all previous report sign by an auditor. Then, the accountant will make your balance sheet on your dissolution date, pay any debt to creditors, because all debt needs to be cleared, including debt owed to the Revenue Department and Social Security Office. You have to cancel your VAT registration, SSO registration and any licenses, and finally close the bank account. In the case that the company has money, payment will go to the shareholders according to the share structure.

    Speak to our team!

    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