Setting Up a Company in Thailand
Establishing a business in Thailand can be a challenging procedure for those who are not familiar with local laws and regulations. Our team of experienced professionals can assist you in determining the best legal structure for your company and setting your company in a smooth way.
Benefits of Setting Up a Company in Thailand
Thailand is increasingly gaining the attention of foreigners and investors due to the multiple business opportunities it offers for those that are willing to set up a company in Thailand.
Some of the benefits of doing business in Thailand include the following:
Strategic location at the hearth of ASEAN
Regional and international cooperation
Second largest economy in South East Asia
Skilled and cost-effective workforce
Thai government support for private investment
Strong transportation
system
21st easiest place for doing business worldwide
Welcoming and rich
Thai culture
The most common structure in starting a business in Thailand for foreigners is the Thai limited company due to its relatively simple set-up process and security it offers to its shareholders.
Key Features of Thai Limited Company
Foreign ownership up to 49%
At least three promoters (initial shareholders)
2 million THB registered capital per foreigner's work permit(*)
One week registration duration
Foreign Business License (FBL) is not required(**)
Unrestricted business activities, if lawfully(***)
(*) If the foreign employee is married to a Thai national, the company’s registered capital is reduced to 1 million THB.
(**) FBL will be required when the foreigner ownership exceeds 49% and business activity is restricted under the Foreign Business Act.
(***) A license must be requested for certain businesses.
There is a wide variety of business structures in Thailand to choose from such as partnerships, representative offices, regional or branch offices.
Our team of experienced professionals in doing business in Thailand can assist you to determine the most beneficial legal structure to your business and to successfully set up a company or establish your business in Thailand.
Requirements to Set Up a Limited Company in Thailand
The incorporation of a Thai limited company requires the following:
At least three natural persons as promoters and one director
2 million THB of registered capital per foreign employee or director
A registered head office located in Thailand
Two constitutive documents: Memorandum of Association (MOA) and Article of Association (AOA)
Key Considerations Before Setting a Thai Limited Company
Foreigners are generally limited to only 49% ownership of a private limited company. The share structure is usually 51% for Thai nationals and 49% for foreigners. However, foreigners are allowed to have majority voting rights and control through preference shares and weighted voting rights.
Foreigners that want to have 100% ownership of a private limited company shall be business which are not regulated by FBA; need to obtain Foreign Business License if the business is under List 3 regulated in FBA; or need to obtain promotion from the Board of Investment.
Advantages of Setting Up a Thai Limited Company
Full control
Limited Liability
The liability of the shareholders is limited to the capital invested
Foreigners can have control over the company by adjusting shares
Flexible options
Engage in all business types with appropriate license
Corporate bank account
Apply for a corporate bank account
Work permit and visa
The company can sponsor visas and work permits for foreigners
The Process of Setting Up a Thai Limited Company
01
Reserve a company's name at the Department of Business Development (DBD)
The approval period for the company's name reservation is 1-3 business days. The reservation will be valid for 30 days, and will not be extended.
02
Prepare and register the Memorandum of Association (MOA)
The Memorandum of Association (MOA) shall include:
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Reserved company's name
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Location where the head office will be established.
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Details of the company's objectives
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Registered capital (at least 3 shares with at least THB 5 par value)
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Name, address, occupation, signature, and number of shares held by each promoter
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Declaration regarding the limited liability of the company
03
Promoters hold a Statutory Meeting
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Adopt the Article of Association (AOA) (optional)
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Fix the type of shares (ordinary vs. preference shares)
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Appoint the director(s) and auditor. It must be appointment at least one director
04
Share capital payment
Shareholders pay at least 25% of share capital
05
Company's incorporation with the DBD
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Director(s) register the Article of Association
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The share capital payment is confirmed.
06
Tax Registration
The corporate tax ID and number is the same number as corporate ID and will be registered automatically when incorporation.
Thailand's Board of Investment (BOI) Promotion
One of the major benefits of applying for investment promotion is that foreigner investors can have 100% ownership if the business is promoted by the Thailand Board of Investment (BOI). BOI is the main government office established in 1997 to encourage foreign investment in Thailand and Thai overseas investment.
Major advantages of setting up a BOI-promoted company in Thailand include:
Tax Incentives
Non-tax Incentives
Exemption of corporate income tax for up to 13 years (Section 28/29)
Exemption/reduction of import duties on machinery (Section 28)
Exemption/reduction of import duties on raw materials (Section 30)
Exemption/reduction of import duties on goods imported for R&D (Section 30/1)
Allow foreigners to hold 100% ownership (*)
Allow foreigners to own land (Section 27)
Allow foreigners to take out or remit abroad money in foreign currency (Section 37)
Work permit and visa facilitation (Section 26)
(*) Except for projects in activities under List One annexed to the Foreign Business Act, B.E 2542, Thai nationals must hold shares totaling not less than 51% of the registered capital. Additionally, specific Thai laws may apply.
For more information regarding BOI promoted activities and incentives, check https://www.boi.go.th/
Note that in order to receive an investment promotion, the applicant must follow the conditions prescribed by the Board of Investment as specified in the BOI promotion certificate.
Frequently Asked Questions (FAQ)
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Q
I want to open a company in Thailand but I do not want to buy or rent office space yet. Can I use a virtual office to register my company?
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Q
I am a foreigner who wants to have 100% ownership over my business. Can I register 100% foreign business ownership in Thailand?
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Q
I incorporated my Thai limited company a few days ago. Does my company need to be VAT registered?
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Q
I am not sure whether Thailand taxes Social Security. What is the Social Security contribution rate in Thailand?
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