The following is an overview of establishing a business in Thailand. There are 4 forms of establishment you can choose to operate your business in Thailand:
- Sole Proprietorships. This is not the form of business we recommend since the sole owner is exposed to unlimited liability of the business.
- Partnerships. A partnership can be registered and unregistered. Again partnerships are not recommended for foreigners wanting to do business in Thailand for the same reason as sole proprietorships.
- Limited Companies. The most popular form of business organization among general investors is private limited companies due to the fact that the liability of the investors is limited to the amount of unpaid shares subscribed by them.
A private limited company requires a minimum of three promoters who file a memorandum of association, convene a statutory meeting and register the company. Once the company has been registered, it needs to obtain a tax identity card. Some companies are required to register into the VAT (Value Added Tax) system, depending on the types of business and the level of their gross income. They must also follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounting Act. Companies are required to close their accounts and have an auditor audit their books and file their audited financial statements once a year with the Revenue Department and the Department of Business Development.
- Branch Office . You may choose to operate your existing foreign company in Thailand as a Branch Office. Or you can choose to set up a representative office, which is a form of Branch Office but you cannot earn income in Thailand.
In order to operate a business in Thailand as a foreigner, you need to consult Thailand Foreign Business Law (Alien Business Act). Certain types of businesses do not have to apply for a Foreign Business License while most types do require that you get the Foreign Business License before you start the business operation.
Contact MSNA for any questions about setting up a business in Thailand.