Accounting and Legal Office in Phuket, Thailand

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COMPANY FORMATION


 

THAI COMPANY FORMATION AND REGISTRATION IN THAILAND

Thai Company Limited

A Thai Company Limited, particularly a Private Thai Company Limited is the most popular form of business structures in Thailand. Due to the fact that not only are the Shareholders liabilities limited to the amount of the shares they possess, but a Private Thai Company Limited also allows separation between investor’s body and managerial body.

Section 1096 of the Thai CCC has provided that “A limited company is that kind of which is formed with a capital divided into equal shares, and the liability of the shareholders is limited to the amount, if any, unpaid on the shares respectively held by them”

A Private Thai Company Limited requires a minimum of three promoters and must file a memorandum of association, convene a statutory meeting, register the Private Thai limited company, and obtain a company income tax identity card.

They must also follow accounting procedures specified in the Civil and Commercial code, the Revenue Code and the Accounts Act. A balance sheet must be prepared once a year and filed with the Department of Revenue and Commercial Registration. In addition, companies are required to withhold income tax from the salary of all regular employees.

BRIEF PROCEDURES TO REGISTER A THAI LIMITED COMPANY

  • RESERVE YOUR PROPOSED COMPANY NAME: The Thai limited company name reservation must follow the guidelines of the Business Development Office in the Ministry of Commerce amongst other guidelines.
  • FILE A MEMORANDUM OF ASSOCIATION: The Memorandum of Association of the Thai limited company must to be filed with the relevant Thai authorities.
  • CONVENE A STATUTORY MEETING: The Thai limited company must convene a statutory meeting to make all the appointments.
  • COMPANY REGISTRATION: To establish the Thai limited company it has to be registered with the Thai government.
  • TAX REGISTRATION: All companies in Thailand have to be registered for tax purposes.

Thai Partnership

WHAT IS A THAI PARTNERSHIP?

Ordinary Thai partnership is a business set up by a minimum of two persons. The persons are joint partners who share unlimited liability for all the company’s obligations. It is not mandatory to register an Ordinary Thai Partnership but partners can choose to do so as provided in Section 1064 of Thai CCC, reads in part “An ordinary Thai partnership may be registered”.

Each partner is, jointly and severally, personally liable for debts and taxes of the partnership. For example, if the partnership assets are insufficient to satisfy a creditor’s claims, the partners’ personal assets are subject to attachment and liquidation to pay the business debts.

Each partner may be held jointly and severally liable for a co-partner wrongdoing or tortuous act (e.g. the misapplication of another person’s money or property).

Unless otherwise provided in the partnership agreement, no one can become a member of the Thai partnership without the consent of all partners.

LIMITED PARTNERSHIP

A Limited Thai Partnership is in several ways similar to an Ordinary Thai Partnership, though it provides that there must be two types of partnership. The first one is where partners whose liability are limited and the other one is partners whose liability are jointly and unlimited.

Unlike an Ordinary Thai partnership, Limited Partnerships must be registered.