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Exploring BOI Promotions for the Digital Industry in Thailand
25/05/2023
Thailand has made itself an attractive option for companies in the digital industry due to the availability of receiving a promotion from the Thailand Board of Investments (BOI). Promotions from the BOI come with many desirable benefits, such as 100% foreign ownership, tax breaks, and relaxed restrictions for obtaining work permits for foreign workers.
Another appealing feature of the BOI promotion for digital industry/software development companies is the low application and audit requirements. You only need an initial capital deposit of 1.5 million THB, and there is no strong audit during the first years of operation.
Key points
- Promotions from the BOI come with many highly attractive benefits, such as 100% foreign ownership, tax breaks, and relaxed restrictions for obtaining work permits for foreign workers.
- To qualify for a BOI promotion in the digital industry, the company’s business activities must involve at least one of the following: software development, digital platforms, or digital content creation.
- Companies that qualify for a BOI promotion for Digital Industry are eligible for the following tax incentives: An exemption on corporate income tax (for eight years), import duties on machinery, raw materials used in R&D, and production for export.
- The minimum investment for a qualifying project must not be less than 1,500,000 THB per year.
What is the BOI?
Thailand’s Board of Investment (BOI) is a special government agency that promotes foreign investment within Thailand. A BOI promotion removes many barriers to doing business in Thailand, such as the restrictions of the Foreign Business Act.
More detailed information relating to the Foreign Business Act can be found here.
Furthermore, the BOI also provides the following incentives for qualifying projects:
- 100% foreign ownership of a company.
- Reduced requirements for supporting work permits, i.e., no quotas for hiring foreigners.
- The ability to own land.
- Tax benefits such as income tax exemptions for a fixed period. Please note that tax incentives depend on specific promotions and are not available to all.
What business activities are eligible for BOI promotion for the digital industry?
To qualify for a BOI promotion in this area, the company’s business activities must fall within one of the groups below.
- Software Development: BOI promotions often include software development activities that contribute to the digital economy. This can include developing custom software, mobile applications, web development, software-as-a-service (SaaS) platforms, and other digital solutions.
- Digital Platforms: Examples of digital platforms include; Online Marketplace Platforms, e.g., retail, freelancing, real estate, or other specialized marketplaces. Digital Content Distribution Platforms that distribute and monetize digital content such as movies, music, e-books, digital art, or other forms of multimedia. Collaboration and Communication Platforms enable teams or individuals to collaborate, communicate, and share information remotely. Online Learning and EdTech Platforms that facilitate remote learning and skill development through digital technologies.
- Digital Content Creation: BOI promotions may support digital content creation, including animation, game development, multimedia production, virtual reality (VR), augmented reality (AR), and other creative digital media services.
What incentives are available for a BOI promotion for the digital industry?
Companies that qualify for a BOI promotion for Digital Industry are eligible for the following incentives:
Non-tax incentives:
- 100% foreign ownership,
- Permit to own land,
- Ability to hire skilled workers and experts to work in investment-promoted activities with no restrictions,
- Permit to take our or remit money abroad in foreign currency.
Tax Incentives:
- Exemption of corporate income tax for eight years
- Exemption of import duties on machinery
- Exemption of import duties on raw materials used in R&D
- Exemption of import duties on raw materials used in production for export.
What conditions apply to eligible companies?
- The minimum investment of each project must not be less than 1,500,000 baht per year. Qualifying investment is based on the expenditure on salaries for employees.
- The project must undertake a business activity involving software, digital platforms, or digital content creation in Thailand.
- The corporate income tax exemption is capped at 100 percent of the actual expenditure in the year of application. Expenditure includes the following:
- The amount spent on salaries for Thai information technology personnel who are newly hired exceeds the salaries spent on Thai information technology personnel employed before the application submission date for investment promotion.
- Expenditure on the information technology development-related training course to develop the employee’s skills.
- Expenditure spent on obtaining certificates such as ISO 29110 or CMMI from Level 2 or other equivalent international standards.
How can Belaws help?
For more information about BOI promotions in Thailand, why not talk to one of our experts now?
This article is for information purposes only and does not constitute legal advice.
Our consultations last for a period of up to 1 hour and are conducted by expert Lawyers who are fluent in English, French and Thai.
Consultations can be hosted via WhatsApp or Video Conferencing software for your convenience. A consultation with one of our legal experts is undoubtedly the best way to get all the information you need and answer any questions you may have about your new business or project.
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Frequently asked questions
Can I get a job in Thailand as a foreigner?
Foreign individuals in Thailand can get a job, but they need to hold a Non-Immigrant B (Business Visa) and a Work Permit.
Is it hard for a foreigner to get a job in Thailand?
It is possible for foreigners to get a job in Thailand, but they must comply with the specific rules and regulations regarding employment for foreigners.
Can I go to Thailand and find a job?
It is possible to go to Thailand and find a job, but foreigners must follow the legal requirements and obtain the appropriate visas and work permits.
What kind of jobs can foreigners do in Thailand without a work permit?
Foreigners are generally prohibited from working without a valid work permit in Thailand.
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