Interested in starting a business in Thailand? Is it time to open a regional office in Thailand? Foreigners doing business in Thailand can set up a company in a number of ways.
Solo Proprietorship in Thailand
Although foreigners are generally prohibited from conducting business in Thailand as a solo proprietor, U.S. citizens who register with the Thai Department of Business Development under the U.S. – Thailand Amity Treaty are allowed to run a sole proprietorship in most industries. The U.S. citizen solo proprietor will be subject to unlimited personal liability. A solo proprietor has the option of taxing their business income on their person income tax return.
Thai Partnerships : Unregistered Ordinary Partnership
Ordinary Partnerships in Thailand establish a business with a minimum of two owners. Ordinary partnerships are not required to register with the Commercial Registrar. If the partnership is unregistered, the partnership’s income will be taxed individually. Individual partners are personally liable to creditors only for their portion of the debt.
Registered Ordinary Partnerships
Ordinary Partnerships have the option of Registering with the Commercial Registrar. Registered Ordinary Partnerships are taxed as a juristic person, and are therefore required to issue an annual financial statement and pay corporate income taxes. All owners are jointly, severally, and personally liable to the partnership’s creditors, but creditors cannot seek compensation from individual partners before the partnership’s funds have been exhausted.
Thai LLP (Limited Liabilty Partnership)
A Thai LLP is a partnership with two types of partners. General Partners are allowed to manage the business, and are fully liable for the partnerships financial obligations. Limited Partners are not allowed to manage the business, but their liability is limited to the amount of capital they contributed. Thai LLPs must be registered and are taxed as corporate entities. LLPs must report a financial statement every 12 months.
Partnerships can be registered with the Commercial Registration Office in the province where the partnership’s main office is located. The registration fee is assessed as 1% of registered capital and ranges from 1,000 – 5,000 THB.