Close an Inactive Thai Company or Do Nothing?

[Projectpaperclip]

I setup a company in 2012 with plans to do more with it.... I filed the annual documents/financial statements for the first year. I haven't filed since 2013 because we moved out of Thailand. There is no property or condo in the company. It sounds like closing the company down could be expensive with costs around 130,000 THB  just to catch up from 2013 on statements and penalties... then closing the company would be extra. The laywer is also saying that the Department of Business Development will drop inactive Companies after 3 or 4 years.

 

My question is: If I continue to do nothing; will they really close the company and forget about it? 

 

My wife and I do own a home in Thailand; it isn't in the company name however the company was Addressed at our home address. 

 

Thanks for any ideas/suggestions!

[Damaz6052]

I have the same question. Looking forward answers.

[dotpoom]

Am no expert by any means...but I have closed about 5 companies on the advice of accountants/lawyers. They say that every company has to make "annual returns" even if dormant. Dormant companies still have to pay minimal taxes to be "trouble free" (best way I can describe it). You might never come to their attention...or you might? Probably certainly would if decided to re-activate it or maybe even open a new one.

    Sorry cannot be more definite.

[scorecard]

Another possibility is to search all out for foreigners who want to start a company.

 

Transfer of the shareholders names is a simple fast on-line process and very small official fees. Many accountants and bigger property agents know how to access the gov't site and make the changes. Don't let anybody tell you it requires a lawyer - it doesn't.

 

But there is the point about buying an existing company and at the same time possibly becoming responsible for its' outstanding debts, loan payments, tax issues, unresolved customer complaints, etc etc.

 

Needs checking but maybe someone could create a document which very clearly says that any unpaid item / debt etc., remains the total responsibility of the company seller and the seller required to sign this document with several witnesses. 

 

One possibility is to give the company name etc., to several large property agents and tell them if you have a potential home / property buyer who wants to buy in a company name they can take your company free, maybe even pay any fees yourself to get the whole thing off your plate. 

 

I did exactly the above, about 4 years ago, luckily a potential buyer came along quite quickly, shareholders name changed within a couple of hours and win/win for everybody including the agent to close the sale.

 

 

Edited February 8, 2019 by scorecard

[glamont002]

Only a complete idiot would take over someone else's inactive company. You have no idea what contingent liabilities might be in it.

[Projectpaperclip]

Thanks for the responses. Looking forward to hearing more experiences. My lawyer says that many foreigners don`t close their companies and never have a problem. He also did say that you never know when this might change.

[HHTel]

I had a 'paper company' some years ago.  Found I didn't need it so just allowed it to die peacefully.

 

I know of others who've done the same.

[NightSky]

A limited company needs to be officially closed otherwise someone is still liable for any matters relating to it and official penalties will be building up for non compliance.

 

You might get away with 'walking away' from a company as some respondents have stated although if you have any long term commitments or reason to stay in Thailand I would recommend closing it down officially or transferring it into someone else's ownership rather than having something outstanding that could potentially come back to bite later.

 

On the other hand if you are leaving the country never to return that's another matter however I would still do the right thing and close it officially as you never know what might turn up in the future and especially so in the age of technology and data collection and sharing.

Edited February 8, 2019 by NightSky

[khunPer]

2 hours ago, Projectpaperclip said:

My lawyer says that many foreigners don`t close their companies and never have a problem. He also did say that you never know when this might change.

I helped a friend to start a company limited for a restaurant business a number of years ago. He never made any annual reports, or paid the nominal shareholder capital. His business failed after a short while, and he just left the company untouched; it really never was used for anything. That was 2007 or 2008, and he has since been several times to Thailand; I presume the authorities just deleted the inactive company after a few years.

 

I however don't know if some regulations or rules has changed since then...????

[blackcab]

On 2/7/2019 at 5:00 PM, Projectpaperclip said:

I haven't filed since 2013...

 

Have you checked the status of your company? That was 6 years ago.

 

If you aren't able to do that then PM me the company name and/or the company number and I'll check for you.

[Projectpaperclip]

On 2/8/2019 at 7:29 AM, blackcab said:

 

Have you checked the status of your company? That was 6 years ago.

 

If you aren't able to do that then PM me the company name and/or the company number and I'll check for you.

Thanks for asking; the company is still active; they left us a notice at the house where the company was registered saying things were delinquent. I showed the notice to the lawyer and gave me the quote to properly close it and also the advice that he hasn't know of anyone to actually have an issue with not closing it properly. My wife and I have property/house in our own names and I do plan to go back and live there in a few years. Would be nice not to have to "sweat it" . Maybe I could sell it to someone who is never planning to come back to Thailand; or pay them to take it. Any takers?

[blackcab]

4 hours ago, Projectpaperclip said:

Thanks for asking; the company is still active; they left us a notice at the house where the company was registered saying things were delinquent. I showed the notice to the lawyer and gave me the quote to properly close it and also the advice that he hasn't know of anyone to actually have an issue with not closing it properly. My wife and I have property/house in our own names and I do plan to go back and live there in a few years. Would be nice not to have to "sweat it" . Maybe I could sell it to someone who is never planning to come back to Thailand; or pay them to take it. Any takers?

 

Nobody with any sense will buy a company with no accounts filed for several years due to the amount of money it would cost them to get the company back into a usable state. The same applies for giving the company away. It doesn't cost much to open a new company, and there are no liabilities to accept. With your company the shareholders/directors would have no idea what they were getting themselves into.

 

I think you will find out that the notice that was posted at the company address was part of the government process to wind up the company. My advice would be to leave it well alone for a couple of years and see what happens. You have a few years before you come back permanently, so time is on your side.

[Projectpaperclip]

Thanks to everyone who took the time to comment. 

[manjara]

I also have a dormant company that I HAVE been filing all the appropriate returns for, but it's costing me a fortune because the accountants don't have a 'plan' for how to deal with a dormant company (more money for them!)

I worked out that it would be cheaper to file once per year and pay the penalties, instead of every month, but the accountants refused to do that, and insist on charging me a prep fee every month and a travel fee to lodge the return (zero every month). Even when I stopped paying, in order to catch up they insisted on charging me as though i had filed every month!!

 

Does anyone know of an accountant that can do the minimal paperwork for a dormant company (I somehow feel that companies used to buy property must have a simpler approach?). 

My costs at the moment are around 120k each year to keep everything up to date, but it shouldn't be that high! (about 50k of that is maintaining an address).

 

Given that there seem to be a few of us with these dormant companies, there could be a business opportunity in dealing with them!  (I wouldn't have the time to start that at the moment)

 

P.S. Anyone guess who my current accountants are! (their catchphrase is 'Mai dai!')  ????

[blackcab]

On 8/25/2019 at 4:39 PM, manjara said:

Given that there seem to be a few of us with these dormant companies, there could be a business opportunity in dealing with them! 

 

People do not like buying existing companies as they become liable for any issues the company has, at least to the extent of any unpaid capital.

 

It's much easier to set a company up from scratch, and it's not that expensive.

[Wilson Smith]

On 8/25/2019 at 4:39 PM, manjara said:

I also have a dormant company that I HAVE been filing all the appropriate returns for, but it's costing me a fortune because the accountants don't have a 'plan' for how to deal with a dormant company (more money for them!)

I worked out that it would be cheaper to file once per year and pay the penalties, instead of every month, but the accountants refused to do that, and insist on charging me a prep fee every month and a travel fee to lodge the return (zero every month). Even when I stopped paying, in order to catch up they insisted on charging me as though i had filed every month!!

 

Does anyone know of an accountant that can do the minimal paperwork for a dormant company (I somehow feel that companies used to buy property must have a simpler approach?). 

My costs at the moment are around 120k each year to keep everything up to date, but it shouldn't be that high! (about 50k of that is maintaining an address).

 

Given that there seem to be a few of us with these dormant companies, there could be a business opportunity in dealing with them!  (I wouldn't have the time to start that at the moment)

 

P.S. Anyone guess who my current accountants are! (their catchphrase is 'Mai dai!')  ????

do you still have the company?