Thailand is the second biggest economy in the Southeast Asia region after Indonesia. The World Bank recognizes it as one of the countries with remarkable development success stories. And because of its economic policies, it was upgraded from a lower-middle-income to an upper-middle-income economy back in 2011.
While setting up a business in Thailand can be quite challenging, it can be lucrative if you do it right. Of course, you also have the option to seek professional help from Thailand company registration service provider for a smoother, hassle-free experience. Here are five crucial steps you need to take when registering a company in Thailand.
Step #1: Register your company name
After deciding on your business structure, be it a sole proprietorship, partnership, public, limited company, or a joint venture, you need to choose the name of your company. Some of the things you need to keep in mind when choosing a name for your company are as follows:
- Never pick a name which is identical or similar to the name of a pre-existing registered company
- Pick a simple name which is not too long or hard for non-English speakers to pronounce and easy for clients to remember and write
- The name does not violate any ministerial regulations
Experts recommend choosing at least three names which are arranged according to priority to maximize the rate of success. Private limited companies, however, need to end their company names with the word “Limited”. Once the chosen name is approved, it will only be valid for thirty days with no extension. However, business owners can still reapply for the name reservation as long as it is still available.
Step #2: File for the Memorandum of Association
The Memorandum of Association (MOA) is an exclusive agreement created by the company’s founders or promoters which will be submitted to the Department of Business Development of the Ministry of Commerce. For a private limited company, it must contain the following items:
- The proposed company’s name
- The Kingdom’s province where the registered company office will be located
- The company’s objectives
- The share capital’s amount which the company offers to register
- The promoters’ (at least three people) names, addresses, professions and signatures
- The numbers of shares subscribed to by every promoter
- For a private limited company, there should be a declaration of the limited liability of the shareholders.
The promoters must sign the Memorandum’s original copy and have it certified by two witnesses.
Step #3: Convene a statutory meeting
Business owners can convene a Statutory Meeting as soon as they register the Memorandum of Association. The purposes of this meeting include; to adopt Article of Association, to ratify contracts the promoters have entered into or to internalize any expenses incurred during the promotion of the company, and to appoint the first directors and auditors and fix their respective authorities. After the statutory meeting, promoters need to hand over all businesses to the appointed director.
Step #4: Register your company
Within three months from the date of the statutory meeting, the directors need to file the company registration application to the Ministry of Commerce. If the company fails to register within the specified period, the statutory meeting will be voided. If the company wants to register again, the promoters would need to convene another meeting for people who reserve to purchase the shares.
The promoters need to supply the necessary documentation during the registration process, including the prospective auditor’s name, license number and remuneration. For a private limited company, the registration fee would be about THB 500 per THB 100,000 of registered capital.
During this phase, the Thai shareholders may need to disclose the source of their investment. The directors may also need to provide a statement attesting that the shareholders have paid their subscriptions.
Step #5: Register for corporate income tax and VAT
Within sixty days of the date of the company incorporation, a company liable for corporate income tax needs to get a tax ID card and number from the Revenue Department. A foreign company, on the other hand, will need to get the ID when it starts carrying on business in the country. Companies with turnover exceeding THB 1.8 million also need to register for VAT within thirty days of the date when they reach the exceeding amount in sales.
If you are still confused about the registration process or find it too daunting, you can always seek guidance from experts from the Thailand company registration service providers.