Does a bank lend to a 'Thai partnership company' or to the person?

[ghworker2010]

The wife and I intend to set up a 'Thai limited liability partnership' company structure. I will be putting in 50% of the purchase price of a building. The wife wants to borrow her share from a bank. 

 

Will the bank lend to the partnership company or to her personally? The developer who is selling the newly finished shops told us that the land is govt land and that we only get a 30 yr lease which would be registered at the land office. 

 

The reason that we intend to set up the partnership company structure is that doing so will allow me to get a WP. 

 

thanks

[ghworker2010]

I just read up about the tax law. 

 

It seems that 'interest' on money borrowed for business purposes is deductible. Thus it seems it would be best to borrow in the company name. 

[PoorSucker]

It doesn't matter as in this company structure all owners are liable for debts in the company. 

You will be liable for 50% of the debt. 

BTW, you will not get a work permit without two employees or bribes. 

[ghworker2010]

20 minutes ago, PoorSucker said:

It doesn't matter as in this company structure all owners are liable for debts in the company. 

You will be liable for 50% of the debt. 

BTW, you will not get a work permit without two employees or bribes. 

Actually are you sure about that regarding the liability of the debt. It depends on whether we originally set up an unregistered ordinary partnership  OR a registered ordinary partnership?

 

Im more interested in the specific question asked above. We approached 1 bank and the manager said its more complicated to get a business loan and takes longer. He said the interest rate is higher. 

 

For the purposes of deducting interest on the loans I think its better to do a business loan. 

[PoorSucker]

Not sure, that's why you make a company with shares, to avoid liability. 

[Dagnabbit]

Does the company have any income?

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[simon43]

It depends on whether we originally set up an unregistered ordinary partnership OR a registered ordinary partnership?

Not sure that helps.

If it is a partnership without limited liability, then the bank lends to the partners and they will have personal liability.

If it is a limited liability partnership, then the bank lends to the partnership and will probably insist that the partners also provide personal liability to repay the loan if the company goes bust.

BTW, this isn't unique to Thailand. Years ago when my ltd company took a loan out in the UK, I (as the company director)also had to provide personal liability to repay that loan.

Banks are not 'good samaritans' - they want their pound of flesh whatever happens.