There are many growing sectors and business opportunities to pursue in Thailand post-pandemic. For those considering starting a company in the country, here is our guide to help you register your business in Thailand.
Startups in Thailand have faced many challenges because of the ongoing Covid-19 pandemic due to supply chain disruptions, lockdowns, and other restrictions. However, certain industries are thriving and innovating to create solutions for these challenges, such as the food delivery and logistics sectors. Furthermore, Thai startups have cumulatively reached unicorn status, gaining over US$100 million in funding in 2021.
There are a few different types of companies you can start in Thailand, and in this article, we will be discussing setting up a Thai Limited Company, similar to a limited liability company (LLC) or private limited company. This is the most popular company structure for foreigners in Thailand.
A Thai Limited Company is owned by at least three shareholders, who may, by subscribing their names to a memorandum and in compliance with the Civil and Commercial Code, promote and form a limited company.
There are a few requirements to take into consideration before you can register your business in Thailand.
Firstly, there must be three persons as the initial shareholders, and this number must be maintained at all times while the company is operating. They do not have to remain the same.
Secondly, the head office of the company must be located in Thailand, which should be proven by a copy of your House Registration (Tabien baan) and a Letter of Consent from the landlord. In addition, there must be a minimum of TH฿2 million of registered capital for foreign businesses, along with a Letter of Certification from your bank to demonstrate you have sufficient funds.
All of the above supporting documents must be signed by all shareholders in Thailand.
Foreign Business License
If your company is over 49% foreigner-owned, you must file for a Foreign Business License. This means that your company operations and entities will be governed by the Foreign Business Act. Find the qualifications for a Foreign Business License here.
Register Company Name
After you have fulfilled the above requirements, you will need to register the company name next. The name cannot resemble or be the same as any existing company and under Section 1098 of the Thai Civil and Commercial Code, must end with “Limited.”
You must reserve the name at the Department of Business Development (DBD) of the Ministry of Commerce. This can be done online and is usually approved within one to three business days. Once the name is approved, you can continue the registration process, using it in all documents henceforth.
Memorandum of Association
A Memorandum of Association (MOA) is an agreement between the shareholders, founders, or promoters of the company. At this point, all shares must be paid. The fee for registering the MOA is TH฿50 per TH฿100 thousand of registered capital, with a maximum of TH฿250 thousand.
The MOA must include your company name, which province the registered office will be located, a declaration that the liability of the shareholders is limited, the amount of share capital that the company proposes to register, the details and signatures of each promoter, and the number of shares per shareholder. Make sure to also include business objectives. The MOA must also be submitted to the DBD.
Convene Statutory Meeting
Once the MOA is registered, a statutory meeting can be convened. This is where the company’s by-laws and articles of incorporation must be drafted. This meeting is also when the Board of Directors and Auditor will be appointed. The resolutions of this meeting will not be considered valid until a vote takes place and a majority wins to pass them, including at least half of the promoters.
Register Your Company
Your company registration should be lodged the same day as the MOA at the Ministry of Commerce, provided that the statutory meeting has taken place and been resolved. It is to be noted that your application for business registration must be submitted no sooner than 90 days after the statutory meeting.
Within the application, you must provide the total number of shares allotted, the amount already paid on each share if any, and the names, occupations, and addresses of the directors and whether or not they have power to act separately from one another, as well as their respective powers and the number and names of the directors whose signatures are binding.
Lastly, make sure to include the address of the main office and any other branches. The registration fee for a Thai limited company is TH฿5,500 per TH฿1 million of registered capital.
Corporate Income Tax and VAT
The next step is to register for corporate income tax, which is around 20%, and Value Added Tax (VAT). After registering your company at the Ministry of Commerce, and within 60 days of beginning operations, you must file for and obtain a company corporate tax ID card from the Revenue Department.
Some businesses that are excluded from VAT must file for Specific Business Tax (SBT), including but not limited to banking and financial institutions, life insurance, pawnbroking, and sale of securities. Tax cards, VAT certificates, and other appropriate documents must be filed after registration at the DBD, as well as the Central Filing Office of the Revenue Department in Bangkok.
Social Security Registration
When you have commenced operations and have more than one employee, your company must register at the Social Security Office within 30 days of hiring. If you are a foreigner legally working in Thailand, you are entitled to the same benefits as Thai employees.
Open a Company Bank Account
Once your company is registered at the DBD, and has been issued the Business Registration Certificate and Company Affidavit, your company can open a corporate account at any established commercial banks in Thailand.
Hopefully, this breakdown has equipped you to confidently set up your business in Thailand. For entrepreneurs looking for flexible office spaces, why not take a look at the best coworking spaces in Bangkok to get you started.