Company Incorporation Step by Step: Thailand

03/09/2020  — by Celestine Loh

Photo by Geoff Greenwood on Unsplash

 

This article covers the main points on registering a company in Thailand. Read on for details on Thailand’s requirements, procedures, and the estimated timeline to register a company. 

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Minimum Setup Requirements to Register a Company in Thailand

There are various business structures to consider for incorporation in Thailand. 

Director Requirements:
  • Private Limited Company: at least 1 
  • Public Limited Company: at least 5, with majority residing in Thailand 
Nationality/Residency of Officeholders Requirements:
  • Private Limited Company: no requirements unless required internally
  • Public Limited Company: majority of directors must reside in Thailand. No requirements for shareholders
Minimum Capital Requirements:
  • Private Limited Company: minimum of 15 Baht
  • Public Limited Company: no minimum 
Shareholder Requirements:
  • Private Limited Company: at least 3
  • Public Limited Company: at least 15  

Registration Timeline 

The business incorporation process is pretty straightforward in Thailand. With the correct paperwork and information required on standby, the entire incorporation process should take around 14 working days

The place for registration depends on the place of business. More information can be found here. The registration process must be completed within 30 days prior to the first day of business of the company. 

Step 1: Reserve a Company Name 

To reserve a company name, it is important to have 3 company names on standby and it is advisable to rank them in order of preference. The proposed names will be checked against Thailand’s company name requirements (thus, the need for preparing 3 names).

The company name must be registered in Thai officially. 

Company Name Requirements:
  • Must not be identical to/ resemble any pre-existing registered business name
  • Must not contain words that are prohibited from being used within the company name (e.g. investment) 

If the above requirements are met, the company name can be officially registered with the Department of Business Registration. The approval will take approximately 3 working days before you get your company name registered. 

*From the date of company name registration, all other steps for business registration must be completed within 30 days. 

Step 2: File a Memorandum of Association (MOA) 

The MOA is a special agreement involving the founders of the company and it must be filed with the Business Development Office located at the Ministry of Commerce.

MOA Requirements:

  • Approved name of proposed company 
  • Address of the registered office/ place of business 
  • Objectives of company
  • Declaration of limited liabilities of the shareholders 
  • Declaration of the amount of share capital being registered 
  • Names, addresses, occupations, and signatures of at least 3 promoters of the company 
  • The number of shares subscribed to each promoter

Once the MOA is submitted and approved, the Business Development Office will issue the Company Affidavit (a written statement of approval). 

Step 3: Convene a Statutory Meeting

A meeting must be held with the company’s directors, shareholders and required other officeholders in attendance. 

The meeting must conclude with the share structure, an appointed auditor and the Board of Directors. The Articles of Association must also be written and passed. Remuneration to promoters, number and type of shares must also be decided on. 

Step 4: Company Registration

The application for company formation must be completed and submitted to the Ministry of Commerce. This application can be submitted on the same day as the MOA submission (only if Step 3 has been completed beforehand). 

This application for registration must be lodged within 3 months from the date of the statutory meeting for it to be valid. 

The application will require details such as:

  • Total number of shares subscribed or allotted 
  • Number of ordinary or preference shares allotted 
  • The monetary amount received for the shares 
  • Personal details of the directors (as well as the details of the Power of Attorney if there is a need for it) 
  • Registered address for the place of business or any branch offices’ addresses

The application must be declared to be true and correct by the director of the company. 

The cost of registering the company depends on the amount of registered capital for the company. In general, the cost is in increments of 500 Baht for every 100,000 Baht of registered capital. The minimum cost is 5,000 Baht and is capped at 250,000 Baht

Step 5: Tax and Value added Tax (VAT) Registration

A Tax ID number and VAT certificate must be obtained for businesses that are required to pay an income tax. The registration and certification can be done at the Central Filing Office of the Revenue Department within 60 days of registering the company. The cost is around 20 Baht for both the number and certification. 

Accounting

The Thai Financial Reporting Standards (TFRS) governs the accounting standards that all Thai registered companies must comply with. Company accounts must be kept at the place of business and be regularly updated. The auditing for the company must also be done by a qualified Certified Public Accountant of Thailand.

Corporate Tax Requirements

In general, the Corporate Income Tax rate is 20% for all Thai registered companies. However, for companies with paid-in capital not more than 5 million Baht at the end of the accounting year are subjected to tax rates as followed: 

Net Profit (in Baht)

Tax Rate 

0 – 300,000

0%

300,001 – 3,000,000

15%

Over 3,000,000

20%

Annual General Meeting

The Annual General Meeting must be held within 4 months of the fiscal year end as required by law. Not doing so will result in a fine as per the Thai legal requirements. 

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

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READ MORE: Documents required when incorporating your business

Tags: company incorporation | Company secretarial | Thailand | z-syndicate

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