BOI Application Guide Thailand: Understanding Investment Schemes for Foreign Investors

leowatanabe5
5 days ago
3 min read

The Thailand Board of Investment (BOI) is a government agency that encourages foreign investment in specific industries. BOI-approved companies can enjoy benefits ranging from corporate tax exemptions, reduced import duties, and 100% foreign ownership in certain sectors. These incentives aim to reduce operational barriers and enhance business competitiveness, making Thailand an attractive investment destination in the ASEAN region.

Tax and Non-Tax Incentives

Depending on project type, industry, and location, BOI-promoted companies can receive Corporate Income Tax (CIT) exemptions for up to 13 years. They can also benefit from import duty exemptions, which can be full or reduced on machinery, raw materials, and essential goods, depending on the nature of the business.

Additionally, businesses can claim up to double deductions on transportation, electricity, and water supply costs, and deduct an additional 25% of infrastructure installation or construction costs. Special incentives for Special Economic Zones (SEZs) and the Eastern Economic Corridor (EEC) can include up to 8 years of CIT exemptions.

Non-tax incentives include 100% foreign ownership, simplified visa and work permit processes, land ownership rights, and foreign currency flexibility. These benefits make BOI companies an attractive option for foreign investors compared to limited liability companies, which require a Thai national to hold 51% ownership of the business.

BOI Application Criteria

Thailand’s Board of Investment (BOI) offers incentives to businesses that meet strict criteria aligned with national economic priorities. Eligible projects must operate in targeted sectors, meet minimum investment thresholds, and comply with technology and environmental standards.

To qualify for BOI incentives, businesses must meet the following key requirements:

Eligible Activities: Must align with BOI-promoted sectors like high-tech manufacturing, green industries, digital, logistics, and food processing.
Capital Investment: Minimum of 1 million THB (excluding land/working capital); 1.5 million THB/year for R&D or tech activities.
Debt-to-Equity Ratio: Maximum of 3:1 for new projects; expansion projects reviewed individually.
Large-Scale Projects: Investments over 2 billion THB require a detailed feasibility study.
Value Addition: Must add at least 20% value (10% for certain sectors like agriculture and electronics).
Modern Technology: Use of modern machinery/processes; second-hand machines must be certified and under 5 years old.
Environmental Compliance: Must follow BOI environmental standards and complete Environmental Impact Assessment (EIA) if required.
Quality Standards: Projects over 10 million THB must obtain ISO 9000/14000 or equivalent certifications within 2 years of operation.

Eligible Industries for BOI Promotion

Thailand's Board of Investment (BOI) categorises its targeted industries into four groups:

Bio-Circular-Green (BCG) Economy Industries: Includes modern agriculture, biotechnology, and renewable energy.
Advanced Manufacturing Industries: Covers electric vehicles, smart electronics, and aerospace.
Basic and Supporting Industries: Focuses on infrastructure, steel production, and medical supplies.
Digital, Creative Industries, and High-Value Services: Encompasses IT, software development, media, and tourism-related services.

These groups are designed to support Thailand’s long-term development goals. They promote sustainable growth, innovation, and high-value investments. Each group focuses on specific sectors.

How to Apply for BOI Promotion

To register a BOI company in Thailand, businesses must evaluate their plan's alignment with the BOI's objectives, including market demand, financial projections, and potential contributions to the Thai economy. The application should be submitted via the BOI e-Investment Promotion system. Documents such as the company profile, business plan, and shareholder information are required.

A BOI officer will then review the application, and a clarification meeting may be scheduled. The approval process typically takes 40 to 90 days, depending on the investment's size and complexity. If the company is not yet established, registration with the Department of Business Development is required.

The BOI typically issues the Promotion Certificate within 10 working days. After the Promotion Certificate, project implementation can proceed including equipment procurement and workforce recruitment.

BOI Renewal Process and Expert Assistance

To maintain BOI status, companies must submit yearly reports, including audited financial statements and progress updates. The BOI checks project progress through site visits and uses AI tools to help with monitoring. Certain incentives require renewal applications and non-compliant companies may face fines or repayment of claimed tax benefits. Non-compliance can also result in privilege revocation.

Businesses should keep clear records and use the BOI e-Service platform to submit documents on time. Setting up a BOI-promoted company in Thailand takes careful planning. Our team of experts has helped several foreign companies successfully register their BOI status. BizWings Thailand can help with the entire process from applying for BOI approval and registering your company to handling visas, work permits and renewals.