In Southeast Asia, Thailand is increasingly recognized as a key location for businesses to prosper. Entrepreneurs and investors are moving to the Kingdom for various reasons, including its advantageous location, well-developed transportation infrastructure, and thriving startup ecosystem. For your plan of starting a business in Thailand, this article will give you the knowledge and instructions you need to succeed.
- Select the Right Business
- Develop an understanding of the Thai Foreign Business Act
- Have a Knowledge about the BOI Incentives and Privileges
- Visa and Work Permit Application
- Register your Company in Thailand
- Opening a Corporate Bank Account
- Complete your Tax Documentation
- Understand the Thai Language and Culture
Select the Right Business
Choosing the type of business you want to launch in Thailand is the first stage in the process. It is significant to remember that, unless the company is a participant in a Board of Investment (BOI) programme, the majority of shareholders must be Thai, with foreign ownership of the company being limited to 49% at most. If your company is not restricted by the Foreign Business Act or is awarded a Foreign Business License (FBL) in Thailand. It is typically given to foreign-owned enterprises that do not directly compete with Thai businesses, this minority ownership percentage may, nevertheless, be disregarded.
Develop an understanding of the Thai Foreign Business Act
It’s also essential to comprehend what foreign businesses are not allowed to do in Thailand. According to the Foreign Business Act, certain types of firms are not allowed in Thailand, while others only need authorization from the relevant government institutions. Before making any business decisions, review the entire schedule of events.
Have Knowledge about the BOI Incentives and Privileges
To encourage investment in Thailand, the Board of Investment (BOI) provides a range of incentives and perks. Apply for the BOI promotions if your firm fits the requirements. Tax incentives include, among others, the exclusion of import duties on raw or necessary materials used for research and development from import duties for up to 13 years (depending on the company’s activities and other conditions), the reduction of corporate income tax by 50% for five years (only in special investment promotion zones), and the exemption of corporate income tax for up to 13 years (depending on the company’s activities and other conditions). While 100% foreign ownership (aside from some businesses and industries), the right to buy land, and the right to employ foreign experts and talented people in Thailand are non-tax benefits.
Visa and Work Permit Application
To legally work in Thailand, you will require a Non-Immigrant ‘B’ or Business Visa as well as a Work Permit. You can apply for this kind of visa at a Royal Thai Embassy or Consulate in your home country. You can renew your visa and apply for a work permit once you’re in Thailand.
As an alternative, take into account the SMART Visa Program, a brand-new category of visa aimed at talented workers, startup entrepreneurs, and investors who want to work or invest in specific areas. Holders of this visa receive privileges such as a four-year maximum stay, an exemption from the need for a work permit, and other benefits.
You must fulfill the requirements listed by the BOI office to apply for a SMART Visa in Thailand.
Register your Company in Thailand
Reserving a company name online with the Department of Business Development is the first step in setting up a company in Thailand. The Memorandum of Association, an application form with a list of shareholders, director forms that have been signed by all of the company’s directors, a declaration of business operation form, and information on your company’s offices and branches should all be prepared next. The taxpayer identification number for your firm can be obtained by registering the business at the local business registration office. This is the most vital stage for starting your business in Thailand.
Opening a Corporate Bank Account
It is not difficult to open a corporate bank account in Thailand, however, the company director must physically visit the bank. Moreover, we can also help you to open a corporate bank account in Thailand by making the process easier for you!
Normally, you can complete the process by following these steps:
Step 1:
Prepare the necessary paperwork, as well as any extras the bank may ask for.
Step 2:
Fill out the bank application form completely.
Step 3:
To submit the paperwork and arrange a meeting with the manager, go to the nearest branch of the bank.
Please note that the documentation will be complete only if your application accompanies the following set of documents:
- Copy of the company’s registration certificate
- Stamped minutes of the board of directors meeting authorizing the opening of the account and designating the signatories for payments and closure of the account
- The tax ID card of the company
- ID card or passport of every member of the board of directors and shareholder who holds more than 25%
- Copy of the articles of association and memorandum of association
- Shareholder’s list
- A minimum deposit of THB 500 (may differ between banks)
Additionally, you may need to provide the following documents before starting your business in Thailand:
- a work permit,
- company records,
- tax details and
- personal financial information
Generally, it takes around 1 week for your corporate bank account in Thailand to be functional.
Complete your Tax Documentation
According to the Revenue Department, businesses in Thailand must pay Corporate Income Tax (CIT) and file their tax reports (Form CIT 50) within 150 days of the conclusion of their accounting period. Deductible expenses come in many different forms, and the CIT rate is 20% of net profit, though this might vary according to the type of taxpayer. WHT tax filings and VAT filings must be done each month.
Understand the Thai Language and Culture
It’s critical to have at least a fundamental understanding of the Thai language and culture to be successful in business. Foreigners can take language, social, and cultural classes at Chulalongkorn University’s Center of Thai as a Foreign Language (CTFL). As an alternative, having a reliable Thai business partner can help you get through communication difficulties.
Boost your Corporate Presence in Thailand
Chambers of Commerce assist and support companies operating in a specific region or sector. The following are some benefits of chambers of commerce:
Build a Strong Network
Chambers of commerce offer a venue for networking, idea sharing, and project collaboration between firms. Networking might result in new business prospects and connections.
Corporate Advocacy in Your Favor
Chambers of Commerce advocates for laws and policies that benefit their members to local and federal officials on behalf of corporate interests. Members may also receive legal and regulatory guidance from them.
Marketing and Promotion
Through events, social media, and other marketing channels, chambers of commerce promote their members’ companies. Increased visibility and commercial opportunities may result from this.
Gain Access to Resources
Business support services, mentoring programmes, and educational workshops are just a few of the resources and training that chambers of commerce frequently offer to their members. Businesses may benefit from this by increasing productivity and competitiveness.
Gain Deep Involvement in the Thai Community
Businesses can build a good reputation in the community and improve their connections with locals and organizations by participating in community activities and projects that chambers of commerce frequently take on.
If you find it cumbersome to fulfill all these steps, let us help you. We are registering foreign businesses in Thailand for more than a decade and it will be our pleasure to help you in your venture as well. To get full assistance and procedural guidance on the process of starting your business in Thailand, email us at [email protected].
