How to Register Your Company in Thailand with Minimum Investment?

Registration of a business entity in a foreign land can involve too many legalities and high investments. That can be one of the reasons why a great portion of investors refuse to do foreign investments. But, if you are willing to register your company in Thailand, then this article is for you. It will guide you through a process of the same involving minimum investment.

Before we go into the process of registering your company in Thailand, we would like to share some key information. This information can be very relevant for you to select the industry and mode of investment in Thailand.

Recent Announcements of BOI Thailand:

Thailand is a nation of great trade importance, especially from the perspective of foreign investment. A major reason for that is the welcoming nature of the Board of Investment (BOI) for foreigners willing to invest in Thailand. In pursuance of the same, BOI Thailand in association with various Ministries of Thailand made the following few announcements recently: 

1. Any foreign investment in the Bio-Circular-Green Economy Model would attract additional tax incentives, reduction and deductions;
2. Three types of businesses, i.e., telecommunication, treasury centre and software development, do not require Foreign Business License;
3. The scope of the Service sector has been expanded with up to 50% tax deduction on the investment value;
4. A stimulus package worth US$30 billion was announced covering the following: 

1. 1. Incentives in the forms of tax relief worth US$700 million is announced for Tourism Industry;
   2. Investments worth US$33 million or more done within the last 12 months are eligible for an additional 50% tax exemption over their profits;
   3. Investments in the digital economy can attract 50% tax exemption for additional 3 years;
   4. Special announcements for tax exemption for investments made in the 10 Special Economy Zones (SEZ) of Thailand.

The above-mentioned are a few of the most attractive and impactable announcements in the process of ensuring high rates of ROI on your investments in Thailand. To have a deeper understanding of the low investment opportunities in Thailand, you must be aware of the current business landscape of the region.

Favourable Economic Conditions for your Company in Thailand:

We would like to introduce you to some relevant and vital information related to the current economic conditions of Thailand. This would help you create a business framework relevant to your idea incurring the least investment.

1. The Royal Thai Government and BOI are majorly focusing on the BCG model of the economy for growth and sustenance. This model covers Food, Farming & Agriculture; Medicine and Clinical Segments; Biotechnology and Tourism and Creative Economy. Investments in any of the aforesaid BCG-related industries can attract special investment and taxation benefits for foreign investors.
2. The government announced the following relaxations as part of a 5-year strategic plan for economic development:

• 1. Exemption on import duties for research and development equipment,
  2. Double deduction on the cost of transportation, electricity and water, and,
  3. 25% deduction on installation or construction of facilities.
• The government is greatly interested in attracting Foreign Direct Investment (FDI) related to research and development. Similar trades can attract a tax deduction of up to 150-300% and is good to escalate ROI.
• Royal Thai Government announced the Thailand Plus package for foreign investors. This package facilitates the process of company formation and hiring skilled manpower. It also focuses on other important metrics of foreign investment in Thailand. The package majorly focuses on science, technology and medicine. 
• In August 2020, Thailand received a grant worth $5 million from World Bank. The purpose of this fund is to reduce the import and consumption of HCFCs by 60% within 2023. Therefore, this fund can help to promote industries and companies supporting the government’s initiative in the reduction of HCFC utilization.

Methods of Minimizing Investment for Your Company in Thailand:

By now, you must have understood the present economic and business landscape of Thailand. Therefore, if played strategically, you can surely minimize the volume of investment for your company in Thailand. The following can be few strategies:

1. Focus on investing in the Bio-Circular-Green or BCG Model of Thai Economy. The model comprises industries with promising returns along with special deductions and reductions on the value of your investment.
2. The government is promoting creativity and innovation for various industries. For this reason, they have announced privileges for companies involved in such activities. Privileges include complete deduction or waiver of basic utility service costs like transportations, water supply and electricity.
3. Mould your business objectives in line with the Thailand Plus Package, SDG initiatives or BCG goals of the Royal Thai Government.
4. Include your business within the scope of the services which are exempted from Foreign Business License. This will help you save your investment behind the process of getting the same, further saving few thousand dollars.

Your Take!

The COVID-19 pandemic has severely harmed the financial stability of the leading economies of the world. Thailand is also not an exception in the outcome. In order to cope up with the negating factors the pandemic instigated in the economy, the BOI is proactively facilitating foreign investment in Thailand. Therefore, this can be the best time to invest and register your company in Thailand.

There are several business structures under which you can register your company in Thailand. All you need to do is check the compliance of your business idea with the permitted business models in Thailand. Henceforth, check whether it is eligible for deductions and exemptions under the recently announced schemes of the government. What you get after this is the process to register your company in Thailand with minimum investment and the least working capital requirement.

We are a premier legal firm in Thailand helping foreign investors with the registration and management of their companies in Thailand. We can surely guide you through the process of company registration in Thailand. Simply write to us at [email protected]