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What is the cost of registering a company in Thailand
29/11/2022
Company registration services are available from many service providers, such as law firms (local and international) and accounting firms whose prices start as low as 10,000 THB and rise to over 100,000 THB.
Each company will provide its own style of service and exclude different aspects. The official fees for registering a company in Thailand are THB 6,500. Please note that many companies will exclude these official fees from their quote.
Registering a company in Thailand is a straightforward process on paper, but in reality, many unforeseen difficulties and expenses may arise depending on the initial structuring and your business activities. Companies looking to register their company in Thailand must satisfy their business needs.
What is the fair cost of registering a company?
As is often the case, the safe spot is in the middle, so between THB 40,000 to THB 60,000 (excluding VAT and Government fees).
Firms that charge less may not offer a complete package or use staff with little experience, you get what you pay for. In a worst-case scenario, their company registration service is simply bait used to lure you in to try and sell you other services. Sadly, this isn’t uncommon as these additional services are where such companies can increase their margins (this is often the case with accounting firms).
Firms charging more usually provide a complete package with experienced staff but the premium is only sometimes justified. International law firms that do not have to apply efficient processes as they keep their margins high are good examples of this practice.
With Belaws, our company registration services start from 40,000 THB (official fees excluded). There is an extra 20,000 THB for preparing articles of association with a preference share structure. Both packages include a business eligibility study (to ensure that your chosen business structure will fit your needs) and advice on post-registration duties.
Below are the main points to consider when registering a company. This list will be helpful to you when navigating the different offers that you may receive.
What should a company registration package contain?
As mentioned above, choosing the right package for your business needs is vital. A company registration package must include the following at the very minimum:
- Preparing the company registration forms (reservation of the company name, Memorandum of Association, shareholder list, etc.).
- The translation of the Company Affidavit and List of Shareholders in English for the foreign shareholders
- The preparation of the certificate of shares for each shareholder (in English and Thai)
- The preparation of the Share Registrar Book, which is a record of the share transfers.
Please note that the penalty for not issuing a share certificate and not keeping an updated Share Register Book is up to THB 10,000 and THB 20,000, respectively.
While the above duties are of great importance, they only scratch the surface of the company registration process. When looking to start a company, it is essential to perform due diligence and identify the best structure for your company. Thailand has numerous different corporate structures, each having strengths and weaknesses.
- Is a Limited Company in Thailand the best structure for your business activities? A Limited Company is the most popular vehicle to do business in Thailand. A Representative Office or Branch Office offers unique advantages. Could you qualify for a Thailand Board of Investors (BOI) promotion?
- Thailand’s regional presence in South East Asia also unlocks further unique business opportunities. Alternative structuring options in Singapore or Hong Kong could be available as well. These additional regions could bring other benefits to your business that you may not have known about.
Nine essential things to consider before registering a company in Thailand
Can I operate a 100% foreign-owned company in Thailand?
It is indeed possible for foreigners to own 100% of a company in Thailand. However, it is essential to note that depending on the company’s business activities, a 100% foreign-owned company will probably need to obtain a Foreign Business Licence to operate.
Your advisor should always check your company’s eligibility for a promotion from the Board of Investment or a Foreign Business License.
Can I keep control of a company with a local Thai partner?
To ensure effective control by the foreign minority shareholder over the company, well-drafted documents (preference shares structures with articles of association, shareholder agreements with reserved matters, and option agreements) must be prepared. It is essential to ensure your advisor understands how you want to control your company and can draft the documents properly to ensure you won’t come across any issues at a future date.
What is the minimum capital to register a company?
Under Thai law, the value of a share must be no less than THB 5. The minimum number of shareholders must be 3. Therefore, the minimum registered capital amount required to incorporate a private limited company is THB 15. However, this is not the case; private limited companies usually have a minimum registered capital equivalent to the amount sufficient to start their business.
If you plan to hire and employ a foreigner, you will need to have 2 Million THB registered capital per employee (if you have two foreign employees, you would need 4 Million THB, etc.). Please note, there is an exception to this requirement if the foreigner you wish to hire is married to a Thai national, the amount of registered capital required is 1 Million THB.
BOI companies are also subject to their own exemptions as well.
Do I need Articles of Association?
Articles of Association are optional; we always recommended to draft some. Articles of Association allow companies to optimise the management structure, such as enforcing limited powers for the directors, preference shares with different voting rights and dividend rights, pre-emption rights, and the possibility to do digital meetings.
Are the business objectives of my company broad enough to cover all the business activities undertaken?
When registering a company, it is required to state the business activities undertaken by the company. Failure to do so may carry the director’s liabilities for business activities outside the company objectives. Amending the objectives later requires an EGM (Extraordinary General Meetings of the shareholders)
Do I need a shareholder agreement?
Shareholder agreements further detail the rules of the company. Shareholder agreements are vital as they allow companies to anticipate future events that may put the company at risk. For example:
- Call back and leaver clauses for when a shareholder wants to leave the project,
- pre-emption rights.
- Drag along and tag along rights (when a shareholder wants to transfer his shares).
- Consequences that arise from the death of a shareholder and the transfer of any shares to their heirs.
Having a pre-agreed procedure in place for these events can save a lot of time and hassle in the future.
What office address to use?
Company registration requires a registered address for the company. Virtual offices are generally acceptable when registering the company.
It is important to note that if the company needs to register for VAT or hire foreign employees, a proper physical office is required, along with a letter of consent from the owner of the office.
Can I close a company easily?
Unlike in Singapore or Hong Kong, it is impossible to strike off a company in Thailand. Once a company has been registered, the shareholders must hold an EGM and go through a liquidation process before the Ministry of Commerce and Revenue Department. A liquidator must be appointed, and the company accounts must undergo an audit.
The fees for closing a company usually start at THB 35,000 but could become a lot higher if the company needs to maintain a proper accounting procedure. Failure to ensure accounting compliance will slow down the process because the Revenue Department will want to collect all due taxes before allowing the company to liquidate.
Answers to these questions must offer adequate consideration and applicability to your needs. Each company is different and will have its requirements. Furthermore, there should also be an option available for drafting the Articles of Association and Shareholder Agreements, should they be required.
Can I start my business activities immediately after registering a company in Thailand?
Once the company registration process is complete, it is natural for the owners to want to start operating immediately. However, before they can do so, businesses must consider the following:
Do you need business licenses?
Depending on your business activities, you may require a business licence. Some examples of commonly required licences are:
- a foreign business licence,
- an e-commerce license,
- a factory license.
Your advisor should check whether your company needs to obtain licenses before operating. If any licences are required, your advisor should also help you obtain them.
The prices for obtaining licenses for your company usually start from THB 10,000. The timeline for obtaining these licences ranges from one week to several months, depending on the license type applied.
Opening a bank account
You must open a bank account to release the company’s capital. Your advisor must take a pragmatic approach if their client is abroad, as the client must be at the bank at the time of opening.
Opening a bank account is typically included in our company registration package. If it is not included, the fee varies from THB 8,500 to THB 10,000.
VAT Registration
VAT Registration is a mandatory requirement for a company with an annual turnover of THB 1,800,000 or more yearly. Depending on your business activities and transaction flow, you should register straight away.
Please note that some activities, such as farming, are excluded from VAT Payment. Your advisor should be aware of such things and inform you if your company is eligible for exemptions.
The cost for VAT Registration in Thailand with Belaws’ experts starts from 9,500 THB.
Hiring employees
The company must register with the Social Security Fund (SSF) before hiring new employees. Once this is complete, the company must register each new employee within 30 days of hiring them. Employees must pay special attention to salary packages, allowances & bonuses, and non-competition clauses.
SSF company registration with Belaws’ experts starts from THB 2,500, and the cost for registering a new employee with the SSF is THB 1,500.
The cost of preparing an employment agreement usually starts from THB 15,000 for a simple draft and can increase to THB 40,000 for an executive position.
Accounting & Tax filings
After registering a company in Thailand, every new company must set up an accounting and invoicing system. Bookkeeping should be done monthly and include tax filings such as VAT (if the company is VAT registered) and Withholding Tax (on service transactions between companies).
Your advisor must learn about your business flow to understand how best to satisfy your accounting needs properly. Having a proper understanding of a company’s business activities is vital because some expenses can be capitalized by the company (Intellectual property, for instance), amortized (machinery), and tax optimised. Failure to identify any available tax exemptions etc could lead to a company losing out on significant advantages and enduring unnecessary expenses.
Belaws’ accounting package starts from THB 5,000 and includes a monthly management report and a 1-hour advisory meeting per month regarding your company’s accounting and tax needs. Our accounting and tax experts ensure our service meets each client’s specific requirements, ensuring your full compliance with the Thai regulatory framework
Document Drafting
When new companies start their operations, they require several legal documents to start their businesses. Such documents include NDAs, purchase agreements, terms, and conditions, employment contracts, service agreements, etc. Again, an expert must draft these documents to protect the company’s interests. Poorly drafted documents could result in disputes.
The cost of drafting a contract or legal document is usually between THB 9,000 to THB 50,000, depending on the complexity of the contract/document and the number of revisions needed. Belaws expert lawyers offer fixed prices in advance for drafting and revising contracts.
How can Belaws help?
If you need more information about starting a business in Thailand, why not talk with one of our experts right now?
Please note that 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.
USD 150
Up to 1 hour
Online payment (Paypal or Credit card)
Legal consultation can be conducted in English, French or Thai
Legal consultations are handled by experienced lawyers from the relevant fields of practice
Frequently asked questions
Can a foreigner open a company in Thailand?
Yes it is possible for a foreigner to open a company in Thailand. There are also options available which allow 100% foreign owned companies as well.
How much does it cost to set up a company in Thailand?
The official fees for registering a company in Thailand are THB 7,500.
How do I start a limited company in Thailand?
- Step 1: Choose and register a company name.
- Step 2: Draft and file the Memorandum of Association.
- Step 3: Call and hold a Statutory Meeting of the shareholders
- Step 4: Register the Company with the Ministry of Commerce.
- Step 5: Register the company for Value-Added Tax (VAT) and Income Tax
Is it good to start a business in Thailand?
Thailand is an attractive option for those wishing to start a business. Thailand has a great infrastructure in place and scheme such as the BOI provide great incentives for companies to take advantage of.
How much money do you need to start a business in Thailand?
Typically, it costs between THB 40,000 to THB 60,000 (excluding VAT and Government fees) to start a business in Thailand.The official fees for registering a company in Thailand are THB 7,500.
How can a foreigner start a small business in Thailand?
Yes, foreigners can start a business in Thailand. However, certain business activities are restricted by the Foreign Business Act and in order for businesses to undertake them they must obtain a Foreign Business Licence/Certificate which can be time consuming and complicated.
What is the biggest problem in Thailand?
The biggest problem facing foreign owned companies is being able to undertake their desired business activity as a 100% foreign owned company. Many business activities are protected by the Foreign Business Act and in order for a company to operate in these protected industries, they will be required to be majority owned by Thai Shareholders (unless a BOI promotion has been obtained).
Why is it hard to do business in Thailand?
The Foreign Business Act limits to the business activities a 100% foreign owned company can undertake. This means Thai Shareholders will need to be sought or a BOI promotion obtained in order for a company to legally operate.
Can I own a company in Thailand?
Yes, foreigners can start a business in Thailand. However, certain business activities are restricted by the Foreign Business Act and in order for businesses to undertake them they must obtain a Foreign Business Licence/Certificate which can be time consuming and complicated.
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