Start a business in Thailand in the Right Track
Why many foreign investors are excited to start a business in Thailand? Thailand is the land of smiles where many business opportunities attract more investors to invest in this country. Because of the clear and concise policy in liberalization as well as free trading in Thailand, more investors have been lured to try and start a business in Thailand.
There are various types of business that you have to consider if you want to start a business in Thailand. Among these types is the sole proprietorship. This kind of business is not required to register the business however the owner is in charge all the unlimited liabilities that the business might incur. Therefore all the assets that the sole proprietor has are subject for liquidation. Foreign investors are not allowed to have this type of business. The owner is required to pay tax from 10 up to 37 percent on the owner’s profit. This is also the amount of tax that an ordinary citizen in Thailand is paying.
Another type of business which you can have in Thailand is the partnership which has three categories. The first category of the partnership business is the unregistered partnership. In this type of business all partners are liable for all the obligations as well as the liabilities of the company. Therefore business partners are required to submit all their personal assets wherein it will be all subject for liquidation. They are also obliged to pay taxes 10 to 37 percent of their net profits. The second one is the registered partnership where the partnership has legal entity. This type of company is obliged taxes 30 percent of their net profit. The third one is the limited partnership where this type of business, registration is mandatory. This is the type of business where the capital share determines the liability of the shareholder. This is obliged to pay tax 30 percent of their profit. Another form of business in Thailand is the public Companies. In this type of business the company must have 3 promoters of which all of these are Thais and a permanent resident of Thailand. The limited company is what most foreign investors prefer to have for their business. This is the type of business wherein all the capitals are equally shared to the shareholders, and the liability of each can be determined on the share that they have in the company. The shareholder and the managerial body have distinct entity.
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Starting a business in Thailand is bounded with legal restrictions in which you have to follow it strictly. The Foreign Business Act regulates the ownership of the business. Foreign investors are only allowed to have 49 percent shares whereas the 51 shares must go to the Thai partner and this makes the Thai as the major shareholder o the company. Foreigners are also not allowed to buy lands in this country. The company is only allowed to purchase land whose ownership of the company will last forever unless the company will be dissolved.
To start a business in Thailand you should submit all the requirements that are needed for the company registration. There are guidelines to be followed in the reservation of the corporate name as prescribed by the Commercial Registration Department. You will immediately get the approval or disapproval of the corporate name in about two days.
Then you should file for the registration of the Memorandum of Association to the Department of Ministry of Commerce. You should also pass the company’s name, permanent location, business objectives, and the entire amount of the capital. The personal information of the boar of directors of the company must be included in the file too. The minimum capital that is required for the Thai national is 25,000 Baht but the foreign investors must have a start up capital of 2,000,000 Baht.
After filing the Memorandum of the association, you must hold a statutory meeting wherein all the legalities in the sharing will be discussed. Then you have to apply for tax registration or your company and obtain an identification card and pin number from Department of Revenue. Company who is earning 300,000 up Baht is required to register a VAT. The company is also obliged to withhold tax from the salary of their employees. Companies must also adhere to the accounting procedures set by the Civil and Commercial Code. It is also required to appoint an auditor who will be responsible in auditing all the books of the business. All the audited accounts bear the signature of the shareholders and this must be submitted every year to the Ministry of finance.
Starting a business in Thailand seems to be complicated. To avoid all the complications you can hire the services of the best dependable Thailand lawyer.
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