With an increasing economy, Thailand is considered one of the best countries in the world to start a business. Steps and information on how to start a business in Thailand will be discussed in this article. The country is in a strategic position in Southeast Asia. This serves as a gateway to other destinations in the world.
Big companies have been interested in doing business in Thailand due to its blooming of startups and tech industries. Entrepreneurs and investors have grown interest in starting a business in Thailand so they can take this advantage of the strategic location. The country has the necessary infrastructure for a business to grow.
Choosing the Best Business
There are multiple types of business in Thailand. You must make up your mind about what type of business you want to set up. You must be aware of the Board of Investment (BOI). If your company is not a part of the BOI program the majority share must be with Thai citizen. Foreigners can own only 49% of the company share. This minority share of ownership can be exempted if you have a Foreign Business License (FBL). This license is issued to foreign-owned businesses that do not compete with Thai businesses. It usually takes a few months to get this license from the Foreign Licensing Department.
Next, you must choose the business you want in Thailand. To start a business in Thailand you must know the business entities available to you. Such business entities are:
- Thai Limited Company
- Thai Partnership / Limited Thai Partnership
- Thai Representative Office or Branch Office
The popular business in Thailand is Private Limited Company / Thai Limited Company. In this, the shareholders have limited liabilities and directors have unlimited liabilities.
Thai Limited Company
A private Limited Company is one of the best forms of business in Thailand. It is required that 3 shareholders are in place. A private limited company must hold at least a 51% share to register their company in Thailand. The requirements to incorporate a Private Limited Company are:
- Minimum of three Thai nominee
- At least one director
- An auditor
- A memorandum of association
- Statutory meeting
- Registration of the incorporation papers
- Obtain an Income Tax Registration ID number
Registered companies need to hire auditors who will audit their financial statements once a year. The auditor must submit audit reports to the Revenue Department.
Thailand Board of Investment (BOI) Benefits and Incentives
There is a scheme in place for investors in Thailand. Your business in Thailand must meet the criteria to benefit from this scheme. Thailand Board of Investment offers tax incentives which include exemption from corporate income tax for up to 13 years. Furthermore, it provides a 50% reduction in corporate income tax for 5 years (available only in special investment promotional zones).
Visa and Work Permit for Business in Thailand
To start a business in Thailand you must have a valid permit. You will need a Business Visa or a Non-Immigrant ‘B’ to legally run your business in Thailand. You can get this visa by submitting an application to the Royal Thai Embassy. There are 3 types of business visa. The fee of a visa for a single entry is 2000 Baht having validity of three months. On the other hand, a fee of visa for multiple entries cost 5000 Baht with a validity of one year. Additionally, there is another visa called the SMART Visa Program. This program is relatively new and targeted at investors and entrepreneurs. The benefits of the SMART Visa Program are the permission to stay for 4 years and exemption from work permit requirements.
Applying for a SMART visa requires qualification. If you meet the required criteria you can apply at the Royal Thai Embassy.
Registering Your Business in Thailand
After getting the visa you must register your company in Thailand. Detailed steps are provided below. The first step of business registration in Thailand includes a name search. This can be done online by creating an account.
If you wish to register your company then the process is almost the same for all businesses.
- Company name search
- Registration of the company name
- Prepare and submission of Memorandum of Association
- Prepare and submission of Article of Association
- Fixing a Statutory Meeting
- Submission of necessary documents for company registration
- Registering for VAT or Tax
Paid-Up Capital and Bank Account
The minimum paid-up capital required for a permit to legally work in Thailand is 2 million Baht. This allows 1 work permit. In the case of opening a Bank Account in Thailand, it is easy. Opening a bank account in a commercial bank in Thailand is simple. However, if you require loans from Thai Banks, it will be difficult.
Tax and Fees in Thailand
After successful registration, the company must register for tax and vat with 60 days of incorporation. You can get your corporate tax ID from the Thailand Revenue Board. This process can be easily done online. The table below shows the government fees for the company registration:
|ITEM||THAI GOVERNMENT FEES||STAMP DUTY|
|Company Name Registration||Free of Charge||10 THB|
|Statutory Meeting||Free of Charge||NIL|
|Company Registration||5000 – 250000 THB for per million Baht of Capital||Maximum 400 THB|
|Registration For Tax ID||Free of Charge||10 THB|
|Filling MOA||50 Baht for 100000 THB of Capital / 500 THB for 25000 THB||Maximum 200 THB|
|VAT Registration||Free of Charge||10 THB|
Estimation of company registration in Thailand fees are provided below:
- Service fee- 17000 Baht
- Company Stamp- 500 Baht
- Tas identification- free of charge
- A service fee of 7% VAT
- Subtotal with VAT is around 25000 to 31000 Baht
- VAT registration- free of charge
- Government fee- 6500 Baht for first 1 million Baht and 6000 Baht for every 1 million Baht increase
- Company registration cost is around 24000 to 30000 Baht
Thailand is considered as one of the best countries to start a business. The country’s strategic location allows businesses to have an open opportunity. Thailand has successfully gained the top positions for tourist spot as well as a business startup location. Scopes are limitless. The government of Thailand provides a lot of benefits for entrepreneurs and foreign investors to start a business in Thailand.
Frequently Asked Question
It takes a maximum of 30 days to register a company in Thailand.
If the company has a minimum of 1-million-baht paid-up capital, the government will charge 6000 baht.
Company name registration is free of charge, and it takes a maximum of 2 days to register a company name.