Thailand is an increasingly popular country for businesses looking to expand into the Southeast Asia region. Its strategic location, growing economy, and favorable government policies make it an attractive option. However, understanding the financial aspects of business setup in Thailand is crucial for success.
This article delves into the cost of doing business in Thailand, focusing on company registration fees, associated expenses, and how H&P can guide you through the process.
Understanding the Costs of Setting Up a Company in Thailand
When discussing the subject of Thailand company formation, there are various legal details and documents that need to be addressed. Starting from company name reservation to identifying shareholders, tax registration, visa, and opening a company bank account.
Each of the steps of setting up a company involves costs. Here are the major costs you can expect:
1.Company Registration Fees
Thailand’s registration fees follow a tiered structure based on the company’s registered capital. This means a higher registered capital leads to proportionally higher company registration fees. The minimum registration fee is around 5,000 THB (approximately USD 150).
As for a representative office in Thailand, there is no minimum registered capital. However, you’ll need to transfer sufficient funds to demonstrate your commitment and cover operational expenses. This usually falls between 2 to 3 million THB, depending on your estimated costs.
2.Work Permits and Visa Costs
If you and your team are foreign nationals, you will need to obtain work permits and visas. Both work permits and visas incur individual processing fees. The exact amounts can vary depending on nationality, duration of stay, and type of visa required.
While prices fluctuate, depending on the fee charged by law firms, expect to budget around 10,000 – 30,000 THB per person, encompassing both visa and work permit costs.
3.Accounting and Taxation
Accounting and tax compliance are mandatory for businesses in Thailand, and it is wise to budget for professional services.
Professional accounting firms often offer monthly or annual packages with varying levels of service, depending on the company’s size and complexity. Typically, smaller businesses may find more affordable packages, while larger enterprises will likely require more extensive accounting support leading to higher costs.
4.Office Space
Depending on the nature of your business, you may need to factor in the costs of renting or buying office space. Rent or purchase prices for office space in Thailand vary greatly based on location, size, and the building’s amenities. Prime locations in Bangkok, such as Sukhumvit, Sathorn, or CBD zones, naturally have higher costs.
5.Licenses and Permits
Specific business sectors require additional licenses and permits. Examples include food and beverage, manufacturing, and certain service industries. Also, note that each license or permit likely carries associated government application or processing fees.
6.Legal Representation
While hiring a law firm involves fees, it is often critical for preventing costly mistakes and ensuring compliance with the country’s regulations.
Determining Government Fees for Company Registration
Thailand’s government fees are closely tied to the company’s registered capital. A few considerations must be taken into account to determine the approximate cost of registration, namely, the type of hiring the company would perform.
1. Thai-Majority Companies with No Foreign Employees
If your company has mainly Thai shareholders and does not intend to hire foreign workers, you can have very minimal registered capital (as low as 15 THB). However, the government fee for setting up the company remains around 7,000 THB, regardless of how low your capital is.
2. Thai-Majority Companies Hiring Foreign Employees
If your Thai-majority company plans to hire foreign employees, the registered capital must be at least 2,000,000 THB (or 1,000,000 THB if the foreign employee is married to a Thai national). The government fee for setting up such a company is 12,000 THB, with an additional 6,000 THB for every extra million THB in registered capital. This is due to the requirement of 2,000,000 THB in registered capital for every work permit sponsored.
3. Foreign-Majority Companies
For companies with mainly foreign ownership, the minimum registered capital is 3,000,000 THB. Similar to before, this capital allows for sponsoring one foreign work permit. The government fee to set up this type of company is approximately 18,000 THB. Note that obtaining a license to operate as a foreign business in Thailand has an additional fee of roughly 35,000 THB.
Setting up a company in Thailand requires careful planning and consideration of both financial and procedural factors. The costs of doing business in Thailand include registration fees, legal representation, permits, accounting services, and potential office expenses. So, it is wise to engage with a reputable law firm like Herrera & Partners to ensure a smooth, compliant, and cost-effective process.
How H&P Helps You Set Up a Company in Thailand
At Herrera & Partners, we understand the intricacies of establishing a company in Thailand. Our team of experienced lawyers and business specialists offers tailored solutions and guidance through every step, including:
- Reservation and registration of company name
- Draft of Memorandum of Association (MOA) and statutory meeting
- Obtain the company certificate
- Registration of VAT and Social Security
- Open company bank account
- Assistance on non-B visas and work permits for foreigners
- Accountancy, tax, and payroll
We ensure your business starts on the right foot, maximizing your chances of success in the Thai market.
For professional consultation with a Thai Tax Lawyer, contact us at:
Email: [email protected]
Telephone: +66 22545600
Office in Bangkok: Herrera and Partners Co., Ltd. 142 Two Pacific Place, 17th Floor, Sukhumvit Road, Klongtoey, Klongtoey, Bangkok 10110
