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COMPANY SETUP WAS AMENDED TO ALLOW 3 SHAREHOLDERS:

Foreigners can form companies in Thailand. You NOW need 3 shareholders to form a Limited company & the company must be registered with a valid corporate address. Shares can be 100% foreign owned being individuals or entities, unless the intended business objectives are reserved for Thai nationals under the Foreign Business Act, which requires the company to apply for an Alien Business License prior to commencement of the business. If a company has one Thai shareholder holding 51% of the shares then this is not a foreign company under Thai law and doesn’t fall under the Foreign Business Act.

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Setting your company up: What you need to know
Categories of Business what you can do

 

 

COMPANIES & LIMITED PARTNERSHIPS

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ALL FOREIGNERS: OUR LAW COMPANY ADVISE IS FREE

Dont you get caught out on excessive charges to set your company up. Many have fallen into the trap!!!! A company formulated according to what you wish to do is our guidance & your success.

 

SETTING UP A COMPANY: 

In order to set up a limited company in Thailand, check this info:

 

1. Make sure you know what name you want and have an office

2. Reserve your Company Name
You need a name and it cannot conflict. There are names that are not allowed and the name by the Commercial Registration Department in the Ministry of Commerce eg. Country names; copyright names. The approved corporate name is valid for 30 days. No extension allowed.

3. Memorandum of Association
A Memorandum of Association must be filed with the Commercial Registration Department. This includes the name of the company that has been successfully reserved, its business objectives, registered capital, where the company will be located, and names of the promoters or shareholders. The capital information must include the number of shares and the value per share. At the time of formation, the authorized capital, although partly paid, must all be issued. Capital should be a stated amount, and adequate for the business operation to function healthily. The Memorandum registration fee is 50 baht for every 100,000 baht of registered capital. The minimum fee is 500 baht, and the maximum is 25,000 baht.

4. Statutory Meeting
Then call a statutory meeting so the bylaws and articles of incorporation are approved, the Board of Directors are nominated and an auditor selected. A minimum of 25% of the value of each subscribed share paidup.

5. Registration
Within three months of the date of the Meeting, directors must submit their application to establish the company.

6. Tax Registration
Within 60 days of incorporation, or within 60 days of the start of operations, businesses liable for income tax must obtain a tax identity card and a number for the company from the Revenue Department. Business operators earning more than 1,800,000 baht per annum must register for VAT within 30 days of the date they reach that figure in sales.

7. OTHER REQUIREMENTS

Companies must keep accurate books under the Accounts Act, the Civil and Commercial Code and the Revenue Code. Documents may be prepared in any language, provided that a Thai translation is attached. All accounting entries should be typewritten, printed or written in ink. Section 1206 of the Civil and Commercial Code provides rules on the accounts must be accurate. So you need an accountant but when you have one they must know your business so please ask if they audit other companies the same. If they make mistakes you are too blame?

Taxes
Companies are required to withhold income tax from the salary of all regular employees. Value Added Tax of seven per cent is levied on the value added. This VAT paid monthly. A specific business tax is levied on companies that engage in several categories of businesses that are not subject to VAT. This tax is based on gross receipts, at a variable rate ranging from 0.1 % to 3.0 %. Corporate income tax is 30 % of net profits and is due twice each economic year. A mid-year profit forecast entails advance payment of these corporate taxes.

 

Annual Accounts
A newly-established company or partnership should close accounts within 12 months of the date of registration. Thereafter, these accounts should be closed every 12 months. The performance record has to be certified by the company auditor, approved by the shareholders, and filed with the Commercial Registration Department, at the Ministry of Commerce, within five months of the end of the financial year, and with the Revenue Department, at the Ministry of Finance, within 150 days of the end of the financial year. If a company wishes to change its accounting period, it must obtain written approval from the Director General of the Revenue Department. Always start a company at the start of the fiscal year not during.

YEARLY Auditing
Audited financial statements of juristic entities (that is, a limited company, a registered partnership, a branch, or representative office, or a regional office of a foreign corporation, or a joint venture) must be certified by an authorised auditor, and submitted to the Revenue Department and (except for joint ventures) to the Commercial Registrar for each accounting year. Costs range from 10000baht upwards depending on the size of your company & the auditor is not normally your accountant.

Stocks
Stock dividends are taxable as ordinary dividends and may be declared only if there is an approved increase in authorized capital. The law requires the authorized capital to be subscribed in full by the shareholders.

Statutory Reserve
A statutory reserve of at least five percent of the annual net profits arising from the business must be appropriated by the company at each distribution of dividends until the reserve reaches at least 10 % of the company's authorized capital.

Your Company:

All companies are different so some need licenses that are extra and some are simple. You need to know what you want to setup eg. a Travel agency may need TAT license which can be a combination; then CRS systems more licenses; an export company will need Customs License; DFT reg etc.

 

Those early companies used lawyers who in turn used their staff as nominees or Thais off the streets. Once paid off then that's the end of those nominees, or you thought. However one must remember that if you make a yearly profit you must pay dividends to all the share holders. But, where are they: "the inevitable, my lawyer will take care of it"?? A lawyer is not an accountant so make sure you differentiate between having both when you start a Company. If you are not paying VAT, Social Welfare tax & no yearly audits you will be fined. If you own a property and use a company you must carry on a business & run into profit mode after 3 years.

One can transform a Thai company into a foreign firm. For some of these companies it is to risky to maintain the Thai status as the intention violates the Alien Business Law.  It is now difficult for small and medium foreign companies with capital registration of less than Thai Baht 100 million to get a wholesale license, service license and/or retail of machinery-equipment license as the application has to be approved by a 21 persons committee comprising of high-ranking authorities from various ministries etc. This committee will protect small and medium Thai Business.

COMPANY NAME: Cannot be a country or city name & must end with the words: Company Limited (Co. Ltd); Corporation Limited (Corp.Ltd); or Limited (Ltd).  [ CHECK SETUP COSTS ]

ALL FOREIGNERS: OUR LAW COMPANY ADVISE IS FREE

Dont you get caught out on excessive charges to set your company up. Many have fallen into the trap!!!! A company formulated according to what you wish to do is our guidance & your success.

AMITY TREATY COMPANY:

Only open to USA companies and individuals but you can own 100% of your company. You need a company first and then you apply to the USA Embassy in Bangkok. To see what you must do go to [ Amity treaty ].

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N.B. Complete law services via our NEW Thai Lawyer partner . (re: Alien Business Law: NEC Announcement 281 Cat A prohibited to foreigners). However under the terms of our  Company License Asia Trading Post (Co Ltd)  provide : 1. Cat 34 lawyer services  &2.  Cat 35.consultancy services.

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