Starting a business in Thailand is easy if you know the exact kind of business you want to start. Thailand has a lot of business potential because of government incentives and the availability of cheap and highly skilled labor among many other things. Below is a description of the basic requirements of starting various kinds/types of businesses in Thailand.
1. Starting a Sole Proprietorship Business in Thailand
It is important to note that foreigners are generally restricted from starting sole proprietorship businesses in Thailand. It is however possible to bypass this restriction. For instance, foreigners i.e. US citizens can register sole proprietorships under the United States Thailand Amity Treaty. This treaty allows US citizens to start sole proprietorships businesses in most industries. The process of starting a sole proprietorship is simple and direct. You just need a business certificate which is easy to get if you seek assistance from local authorities.
2. Starting Thai Partnership Businesses
To start a Thai partnership business, you need to register with the Thailand commercial registration office. The registration fee for Thai Partnerships is 1% of the registered capital which ranges anywhere between 1,000 and 5,000 THB. It is also important to note that partnerships between Thai locals and foreigners require a foreign business certificate if foreigners have majority shareholding in the partnership business. It is therefore important to start partnerships with equal shareholding between locals and foreigners to bypass this restriction.
3. Starting Ordinary Partnership Businesses
Ordinary partnership businesses in Thailand refer to partnerships with two or more shareholders. When starting Ordinary partnerships in Thailand, you don't need to register with the Thailand Commercial Registration Office. You will however be required to issue annual financial statements and file corporate income tax returns otherwise you must report the income on partner's/shareholders individual tax returns.
4. Starting a Limited Liability Partnership Business (LLP)
There are two types of partners required to start a LLP business in Thailand. You need General Partners who are basically business managers. General partners are also responsible for the businesses financial obligations. You also require Limited Partners who don't have authority to manage the partnership. Their liability is however limited to their capital contribution. All Thailand LLPs have to register with the Thailand Commercial Registration Office. They also need to pay tax as corporate entities.
5. Starting a Thai Limited Company
Limited Companies in Thailand are governed by the Thailand Civil & Commercial Code. All Private Limited Companies in Thailand must register certain documents i.e. Memorandum of Association (MOA) (which is similar to Article/s of Incorporation) and Articles of Association (AOA) (which is similar to company by-laws). Thai limited companies require a minimum of 3 shareholders. Thai Limited companies have to adhere to strict financial requirements. For instance, financial statements have to be certified by auditors annually, approved by shareholders and then filed with the revenue and commercial registration departments. It is however important to note that small companies are exempted from this requirement. Thai limited companies also require 3 promoters before registration. Each promoter requires at least 1 share in the business/company. Promoters also need to be above twenty years old.
