The Process of Setting Up a Company in Thailand
- May 16, 2014
- Haris & Associates
- 2 Comments
Setting up a company in Thailand can be an intricate process. It is quite different from the process you are required to go through in most countries. Failure to follow the process can be very costly both in terms of money and time. Here are the steps you need to follow to set up the company.
Reserve Company Name
The first step is to reserve the name you have selected for your company. This can be done online. It takes less than a day to reserve the name. The reservation is done through the Department of Business Development. There are no charges for the reservation process. You need to choose at least three names. The names should not be similar with any existing company.
File Memorandum of Association
Once the name is reserved, you have to file a Memorandum of Association. This is filed at the Commercial Registration department. Your memorandum has to include reserved company name, address, organizational objectives, capitalization details, names of promoters and their personal information. The memorandum has to be filed in the specific zone that the company will be based in.
Hold Statutory Meeting
A statutory meeting has to be held to bring together the company promoters. During this meeting, the promoters are required to adopt Articles of Incorporation, approve promoters’ accounts and expenditure during the company formation process, set promoters’ pay, establish number of shares that will be paid out, and select company auditors and directors and their powers. According to Thai law, every company must have a minimum of one director. The director can either be Thai or a foreigner. Once directors have been identified, the promoters have to hand the company over to them.
Apply to Establish Company
Appointed directors are required to make a formal application to establish the company after the statutory meeting. A company has three months to make the application. A registration fee is paid for the application but it varies depending on the company’s capital. A minimum of 5,000 baht is required for registration. The maximum amount that a company can pay to register is 250,000 baht. There is no set minimum amount of capital required to establish a business but a company should ensure it has adequate funds for its operations.
If the company is required to pay taxes, it has to get a tax card and ID number. These are obtained from the country’s Revenue Department. Tax registration has to take place within 60 days after the company is incorporated. If the 60 days lapse, the company has to ensure it is registered before it begins its operations. Companies that make over 1.8 million baht in a year are required to apply for VAT. This has to be done 30 days after the company surpasses the 1.8 million.
The process followed in setting up a company can be simplified if you get assistance from a qualified lawyer in Thailand. It is advisable to use a Thai lawyer because they are in a better position to understand the country’s laws. Using a professional also helps you avoid problems. A lawyer will assist you to sort out any issues that arise before they get out of hand.