Can we set up a call center business in Thailand and get the Thai BOI promotion? What benefits can we get from the BOI?

Answer:

Yes, you can set up a call center business in Thailand. You can also be eligible for BOI promotion under the category of international business process outsourcing activity.

Per the BOI conditions, IBPO services must be provided through the telecommunications network. Services may include administrative support, finance and accounting, human resources, sales and marketing, customer support, international call centers, data processing, etc.

However, only non-tax incentives shall be granted to promoted IBPO companies.

Interested in getting BOI promotion for your company in Thailand, contact ThaiLawyers for company registration, BOI application, visa, work permit and your other business needs.

We would like to cut down the public holiday from 16 to 13 days per year. Do we have to send an official letter to the employees and submit this new company policy at the Labour Department?

Answer:

Yes, you can cut down your annual public holiday to 13 days which is the minimum number of traditional holiday in Thailand per Thai labour law.

You do not have to take it to the Labour Department. Just post it on the company’s bulletin board, if you have one. But if not, just make a letter to announce it and have everyone sign it under the sentence “I have read and understood the above.”

Need help on Thai labour law issues, contact MSNA for Thai accounting, tax and payroll services for further consultation.

Every company limited that is set up in Thailand has to perform the duties as follows:

(1) The company limited must prepare its financial statement at least once every 12 month period and at least one auditor shall audit to propose to the ordinary shareholder’s meeting to approve the financial statement within 4 months from the closing date, and submit the financial statement to the business information service office, department of business development, or any provincial business development office within 1 month from the date of financial statement’s approval although such businesses have not yet been started or have not ceased temporarily; otherwise, they shall have the fine penalty of no more than 50,000 Baht. Also the authorized directors shall have the same penalty.

(2) The director shall prepare the copy of list of all shareholders’ names that are holding the share at the time of the annual shareholders’ meeting and the list of persons who are not the shareholders from the date of the last shareholders’ meeting and submit to the department of business development or any provincial business development office within 14 days from the date of the meeting; otherwise, they shall have the fine penalty of no more than 10,000 Baht.

(3) Must arrange the annual shareholders’ meeting within 6 months from the juristic person’s registration date, and arrange the next meeting of at least one time for every 12 months; otherwise, they shall have the fine penalty of no more than 20,000 Baht.

The invitation for the shareholders’ meeting shall be advertised on the local newspaper for at least one time of at least 7 days before the meeting date, and shall send via reply mail to every shareholder named in the company’s registration for at least 7 days before the meeting date, except the invitation for the shareholders’ meeting to vote for the extraordinary resolution shall be sent for at least 14 days before the meeting date.

(4) Must prepare share certificate to the company’s shareholders; otherwise, they shall have the fine penalty of no more than 10,000 Baht.

(5) Must prepare the book of shareholders’ registration of the company; otherwise, they shall have the fine penalty of no more than 20,000 Baht.
(6) Any companies that relocate the location of head office must request for the registration to the registrar; otherwise, they shall have the fine penalty of no more than 20,000 Baht.

In case that the juristic person does not submit the yearly financial statement as specified by the law, such juristic person has offense, and the managing director or authorized director on behalf of the juristic person shall also have the offense too.

Contact MSNA for Thailand accounting, tax, company registration, visa and work permit and other business services in Thailand.

To encourage foreign investors to invest more in Thailand, the Thailand Board of Investment (BOI) is working out its road show plan and new investment strategy.

The BOI’s investment promotion activities will be adjusted in line with the BOI new investment strategy, which will be implemented in 2015. The new strategy will focus on the industries in which Thailand has good potential.

These industries include basic infrastructure and logistics, basic industry, medical devices and scientific equipment, alternative energy and environmental services, services that support the industrial sector, advanced core technologies, food and agricultural processing industry, hospitality and wellness, automotive and other transport equipment, and electronic and electrical appliances.

Apart from building confidence among foreign investors, the BOI overseas offices will publicize Thailand’s new investment policy, which emphasizes promoting knowledge-based industries and research and development. Thailand still welcomes foreign investment and the current political situation will not have an impact on the implementation of the new investment policy.

The BOI would also improve services for investors, facilitate their operations, and create a conducive investment climate to attract quality investments into the country. For instance, it would coordinate and push for law and regulation improvement, reduce investment obstacles, and ease investment problems.

Furthermore, the BOI would also play an increasingly important role as a center for providing investment information and counseling services. It will promote the development of personnel to cope with the growing industrial sector in Thailand, as well.

It is expected that more foreign investors are likely to use Thailand as their investment base for the franchise business upon the arrival of the ASEAN Economic Community in 2015. ASEAN countries stand to benefit from intra-regional investment activities. Many of them are now in need of investment to increase their potential growth rates.

Contact ThaiLawyers for company registration, work permit, visa and other business services in Thailand.

Taxpayers in Thailand are allowed to hire or use a tax agent to file online tax returns, pay any tax dues at the time of filing, or perform any other duties as prescribed by law.

A tax agent can be an individual or a juristic person registered under the Thai law that meets the criteria of a “tax agent” under the Notification of the Revenue Department.

The roles and responsibilities of a licensed tax agent are summarized as follows:

1. Prepare tax returns and file them online at the Revenue Department official website www.rd.go.th with a tax agent’s username and password;
2. Pay the tax due (if any) through electronic payments or Pay at Post;
3. Submit an electronic amendment form to the list of currency tax agent clients (T.T.04) within 15 days since any change in the list is occurred, i.e. getting a new client or removing a client;
4. Update any changes in the registration information of a tax agent to the Revenue Department, e.g. office address, new branches, registered capital, paid up capital or any other similar changes;
5. Enroll in tax seminars, workshops or training courses as specified in the law.

Need help from English speaking tax agents in Thailand; contact MSNA for Thai accounting and tax services.

According to Section 29 of Labour Protection Act B.E. 2541, an employer shall announce not less than thirteen traditional holidays per year in advance for employees, including National Labour Day as specified by the Minister.

The employer shall fix the traditional holidays according to the annual official holidays, religious or local traditional holidays.

If a traditional holiday falls on a weekly holiday of an employee, the employee shall take a day off to substitute for the traditional holiday on the following Working Day.

Whereas an employer does not provide a traditional holiday to an employee because the employee performs work of such description or nature as prescribed in the Ministerial Regulations, the Employer shall make an agreement with the employee to take another day off to substitute for the traditional holidays or the employer shall pay holidays pay to the employee.

Contact MSNA for your business needs. Our team of experts can provide professional advice on Thailand accounting, taxation and Thai labor law matters.

Foreigners who wish to work in the Kingdom can apply to get Residential Permit provided that the applicant meets the following qualifications:

1. The applicant has to be in a position of executive officer such as President of Committee or Committee of juristic person registered in Thailand with a capital of at least Baht 10 million and is authorized as a signatory for such juristic person, up to the date of application submission, for at least 1 year. The applicant must earn at least Baht 50,000 per month, up to the date of application submission, for a period of 2 consecutive years as minimum and tax return is required and
2. The business in which the applicant works must be of an interest of national economy i.e.
   1. International commerce where its export value in foreign currency in the past 3 years reached a threshold of Baht 20 million in average. This fact must be certified by a letter issued by commercial bank concerned or a company that provide loan to domestic manufacturing company by brining into this country, within the past three years, foreign currency at the amount not less than Baht 100 million or
   2. Tourism related business which in the past 3 years has brought into this country, at least 5,000 tourists in average. This fact must be certified by the letter issued by the authority concerned or
   3. Other type of business that the applicant is a shareholder of at least Baht 5 million for a period of at least 2 years up to the date of application submission.

In case the applicant could not meet any qualification as mentioned in A and B above, then the following requirement is required:

1. The applicant is a holder of work permit for at least 3 consecutive years up to the date of qualification submission and
2. The applicant has been working in the current company for at least year up to the date of application submission and
3. The applicant is earning annual income of at least Baht 80,000 per month for a period of at least 2 years, up to the date of application submission or has been filing tax return for the amount of annual income of Baht 100,000 for at least 2 consecutive years, up to the date of application submission.

Contact ThaiLawyers for residence permit application in Thailand.

One of the grounds for termination of employment of an employee with cause under the Labour Protection Act is repeated violation of work regulations, rules or orders which are both lawful and equitable subsequent to a written warning for which a previous letter of warning has been issued for the particular act. The letter will be effective for a period of 1 year from the date on which the employee commits the violation, not from when the letter was written. However, in case of a serious violation, a written warning notice is not required.

Section 119 (4) of the Labour Protection Act B.E. 2541 (1998) discusses the dismissal for serious cause of an employee who has committed a repeat violation of an offence for which a written warning has already been given, but does not give guidance for the form requirements for the warning letter itself based on the following:

1. Prior to issuing the warning letter, the employer should first consider the work rules. If they contain a disciplinary procedure consisting of several stages which have to be followed step by step, the employer must follow each step.
2. The warning letter must contain:
   1. Date of issuance of the warning letter;
   2. Name and position of the employee;
   3. A description of the behavior of the employee that constitutes a violation of the work rules;
   4. A reference to the work rules which the employee has violated;
   5. A statement that of the employee commits the same violation of the work rules again, the employer will punish the employee pursuant to the procedure in the work rules.

Furthermore, the employer should ask the employee to sign the warning letter as an acknowledgment. The employer can read the letter to the employee and ask 2 witnesses to sign the letter to confirm it has been read and that the employee refuses to sign. A letter from the employee acknowledging violations does not constitute a warning letter.

If the employee is a member of an Employee Committee formed in accordance with the Labour Relations Act, the employer may not discipline the employee, including by issuing a warning letter, even where there has been a determination of guilt. The employer must submit a petition to the Labour Court seeking an order approving the discipline of the employee. If approved, the employer may then proceed as described above.

In the event that the employer relocates its place of business in a way that essentially affects the normal living of an employee, the employer must notify the employee of the relocation at least 30 days in advance or pay an amount in lieu of the advance warning of 30 days’ wages. If the employee refuses to move and work in the new location, the employee has the right to terminate the employment contract within 30 days as from the date of being informed by the employer or the date of relocation, as the case may be. In this regard, the employee is entitled to receive a special severance pay at the rate of not less than the rate of severance pay.

In the event the employer terminates an employment as a consequence of streamlining the work units, production process and distribution service, due to an introduction or change of machinery or technology that reduces the required number of employees, the employer must notify the Labor Inspector and the employee concerned at least 60 days in advance of the date of termination or pay an amount in lieu of an advance notice, that is equal to 60 days’ wages to the employee. Moreover, the terminated employee will be entitled to the prescribed severance pay. In addition to that, if the terminated employee has worked consecutively for more than 6 years, the employee would be entitled to an additional special severance pay at the rate of not less than 15 days’ wages for each full year of service, calculated from the start of year seven onwards. However, the total amount of this additional special severance pay is limited to the equivalent of 360 days’ wages.

If you want to ask us questions on Thailand labor law, please visit www.msna.biz for more information.

In order to relieve the fiscal burden of the government and to respond to current and future economic situations, the Board of Investment prescribes investment policies as follows:

1.1 The efficiency and effectiveness of tax privileges given shall be enhanced. Privileges shall be granted to projects that actually benefit the economy and good governance shall be used for managing and supervising the application of tax and duty privileges. Promoted entities shall report the operating results of their promoted projects to the Board of Investment for review prior to the application of tax and duty privileges for that year.

1.2 Every promoted project that has investment capital of 10 million baht and upwards (not including land and working capital) must obtain ISO 9000 certification or similar international certification. This is to promote development of quality and production standards in Thai industries and, thereby, to enhance the competitiveness of Thai industry in the world market.

1.3 Previous conditions on exports and use of local material are repealed so that the criteria for promotion will be in line with international trade and investment agreements.

1.4 Special promotion shall be given to regions or areas with low income and inadequate investment facilities. Maximum tax and duty privileges shall be given to these regions or areas.

1.5 Importance is given to small and medium industries by applying a minimum level of investment capital of 1 million baht (excluding cost of land and working capital) for projects eligible for promotion.

1.6 Priority is given to activities in agriculture and agricultural products, projects related to technological and human resource development, public utilities and infrastructure, environmental protection and conservation and targeted industries.

Know more about Thailand BOI promotion and its privileges. Contact ThaiLawyers for consultation.

Can a company providing R&D activities apply for BOI promotion in Thailand?

Thai companies providing research and development business can apply for BOI promotion. Qualifying R&D activities are defined as follows:-

1. Basic research – involves theoretical or operational activities that are conducted to explore new knowledge from basic natural phenomena and factual observation, without initially considering the application.
2. Experimental development – involves a systematic operation based on the knowledge from research and/or experience with the objective of producing new materials, products or inventions; to install new procedures, systems and services; or to substantially improve the existing products.
3. Applied Science – involves research to explore new knowledge with an objective to put it in practice for specific use.

Interested in getting Thailand BOI, contact ThaiLawyers for application requirements and procedures.