The fundamental of a Thailand Limited-Company
Posted On March 29, 2019
The most common type of legal entity in Thailand is the limited-company, which is similar in structure to the Limited Liability Company (LLC) in the USA. A limited-company in Thailand must be owned by at least three shareholders and managed by at least one Director. A Thailand Limited-Company also means that 51% of the company shares must be held by a Thai citizens and the remaining shares can be held by anyone including foreigner or a foreign registered entity. In spite of this regulation, it is common for foreigner to use a Thai friend or a professional nominee for hold their shares on their behalf and through carefully planned structure (which we will help you with) the foreigner can still have controlling interest in the company and the bank account.
A Thai limited-company is a legally stand-alone entity under the Thai law and this protects you from unlimited liability. Unlike other countries, in Thailand only the Director(s) is authorized to sign on behalf of the company and individual shareholders are only liable to their percentage of shares.
If you would like to setup a Limited Company where the majority of its shares are owned by foreigner, you’ve 3 options and we can also help you with it.
- Obtain a Foreign Business License
- Board of Investment (BOI) Promotion
- Registration through the Treaty of Amity (for US citizens only)
There is actually no minimum capital required to setup a company in Thailand but we would recommend at least Two Million Baht as this is the minimum required capital to allows your company to employ foreigner and sponsor a work permit. Having said that, you do not need to have this amount of money in your bank before you can register your company. Minimum paid-up amount capital is 25%, which can be used as working capital. If you are establishing a company to hold properties only, then you only need to have One Million Baht as the capital.
Step by step guide on Registering a Limited Company in Thailand (setting up a company in Thailand)
Decide a name for your company and provide 2 other alternative.
UnionSPACE Company Registration team will perform a Company Name Search for you at Thailand’s Ministry of Commerce database and if it is approve, we will reserve your Company Name for you.
Drafting, Signing and Filing of Memorandum of Association (MOA)
UnionSPACE Company Registration team will prepare a draft MOA based on the best practice and run them by you. At this time, you can request for amendments if any. This document is a legal document that will be submitted to the Ministry of Commerce and should clearly state the names and personal information of all company’s shareholders, company business address (PO Box and Residential Address is not permitted here), registered and paid up capital and the primary business activity.
Upon approval of the Thailand Ministry of Commerce, your business is now legitimately register in Thailand and you will be issue with your Company Affidavit, Certificate, List of shareholders and Company Articles of Association.
Tax and VAT Registration for your Thai Limited Company.
If your company expected revenue for 1 year is below 1,800,000 Baht there is no need to register for VAT however you still need to submit a copy of all your company registration documents to the Central Filling Office of the Revenue Department for the issuance of your Company Tax ID Card.
If you need to register for VAT / obtain a VAT Certificate, you must obtain permission from the landowner where your business is registered in if your company does not own the land outright. Alternatively, you can also use UnionSPACE address for this for a small fee.
Opening your Company Bank Account with a reputable Thai Bank
As part of our Company Incorporation package, we will prepare the necessary documents for you and provide you with a letter of recommendation with our partner bank. All company directors and signatories must be present in front of the bank manager before your bank account can be approve and open. Should one of the signatories for the bank account is a foreigner, some banks may require the signatories to have a valid work permit before approving the bank account.
In short, with UnionSPACE Company Incorporation service, we can help you incorporate your business in Thailand even with you stepping foot in Thailand or our office. The usual turn around for company incorporation in Thailand is 2 weeks.