Wholly American Co. & Work Permit?

[Tanukimo]

Hi There! I have some questions about opening a wholly owned American Co.

I am a 34 yr old American here with my American Wife on a 1 year Non -Immigrant O visa- We would like to open a wholly owned american company in order to lease and manage a Restaurant/Bar in Nakhon Si Thammarat.

1) Can anyone tell me about the work permits/ visas and how we can both get them?

2) Can we capitolize with equipment as well as cash, or is it cash only? Exactly how much?

3) How many thai employees are needed for each work permit.

4) Do all the shareholders have to be american?

5) What about social security or insurance for employees?

And what else do I need to know about that I've left out..?

Thank You in advance for any help with this...

BrianB

[wpcoe]

Brian, read through this thread: Amity Treaty Companies And Work Permits. You'll find answers to most of your questions there, and perhaps answers to questions you didn't know you had!

The "Amity Treaty" refers to the treaty between USA and Thailand that grants special conditions to US citizens living in Thailand. I think that's what you mean when you wrote "a wholly owned American Co."

Since Sunbelt is already monitoring that thread, you might want to post any further questions there.

[Sunbelt Asia]

1) Can anyone tell me about the work permits/ visas and how we can both get them?

As of now for a Thai Limited Company or Limited Partnership, the registered capital is 2 million Baht. On August 30th 2009, it must be three million Baht. If you need two work permits, double the criteria.

The sole proprietorship requires no registered capital. However it does have other criteria. You must meet one of the three options. ( As you are married to an American, I will only go with that criteria) four Thai employees, 50,000 Baht in tax paid last year, 700,000 in gross sales last year. If you neeed two work permits, double the criteria.

2) Can we capitolize with equipment as well as cash, or is it cash only? Exactly how much?

As of now, yes it can be equipment to pay for the shares. Equipment can be 100% of the registered capital. However, on August 30th, 2009, the Labor Dept will require that at one time you had transferred three million Baht from overseas.

3) How many thai employees are needed for each work permit.

No Thai employees are required with one exception which is one of the options for a sole proprietorship. In your case, if you chose to use that criterion, it would be four employees per work permit.

4) Do all the shareholders have to be american?

No. Only 51% and 51% of the Directors must be Thai or American.

5) What about social security or insurance for employees?

This is 10% of the employee’s salary. It is capped at 1,500 Baht. The maximum the employee would pay is 750 baht and you would pay 750 Baht.

www.sunbeltasiagroup.com

[Tanukimo]

Thank you for the quick reply= I have read the Amity Treaty post and it leaves my a bit confused...

Sunbelt you've done a good job of answering my questions, I have a few more for ya=

1) Does a sole proprietorship have shareholders, or stock? How many directors and how many thai?

2) How much do you charge to set up either the Thai Limited Co. or the sole proprietorship

3) Is it easy for you to set up for me even though I am in Nakhon Si Thammarat and you're in Bangkok?

Which type of company do you suggest? The main purpose is to lease a restaurant/ bar in Nakhon Si Thammarat for 50,000 B a month-

The business is new but did have sales of approx. 1.1 million B last year.

And we really need 2 work permits for my wife and myself, and also extended visas so we can stop the border run every 90 days=

Thanks in advance,

Brian B

[Sunbelt Asia]

1) Does a sole proprietorship have shareholders, or stock?

No shareholders.

A sole proprietorship is a type of business entity which legally has no separate existence from its owner. It is a "sole" proprietor in the sense that the owner has no partners. A sole proprietorship essentially means a person does business in their own name and there is only one owner.

How many directors and how many thai?

None

2) How much do you charge to set up either the Thai Limited Co. or the sole proprietorship

Sole Proprietorship

2,500 Baht for the sole proprietorship

Tax ID 3,000 Baht

DBA (Doing Business As) 1,600 Baht

19,500 For Amity Treaty

Government Fees are 25,400 For the Amity.

Government fees are 150 Baht for the sole proprietorship.

Thai Limited Co.

2,500 Baht for the Thai Co.

Corp Tax ID 3,000 Baht

Corp Amity Treaty 34,000 Baht

14,520 Baht Government Fees for 2 million Baht Company

25,400 Baht Government fees Amity

3) Is it easy for you to set up for me even though I am in Nakhon Si Thammarat and you're in Bangkok?

The Sole Proprietorship is easy.

The corp. can be registered in BKK and then transferred to Nakhon Si Thammarat

Which type of company do you suggest? The main purpose is to lease a restaurant/ bar in Nakhon Si Thammarat for 50,000 B a month-

The business is new but did have sales of approx. 1.1 million B last year.

And we really need 2 work permits for my wife and myself, and also extended visas so we can stop the border run every 90 days=

With a Thai Sole Proprietorship, it is impossible to get a one year extension of stay based on business.

Because of the option of applying one day for the extension of stay based on business ( this is available only in the second year of your business being in operation and if you meet the criteria), if I was you, I would go with the Limited Company route.

www.sunbeltasiagroup.com

[sonicdragon]

1) Does a sole proprietorship have shareholders, or stock?

No shareholders.

A sole proprietorship is a type of business entity which legally has no separate existence from its owner. It is a "sole" proprietor in the sense that the owner has no partners. A sole proprietorship essentially means a person does business in their own name and there is only one owner.

Assuming that Thailand has the same business laws as other countries I know, it's worth stressing that the owner of a sole proprietorship is personally responsible for the debts of the business, whereas an incorporated company can run up it's own debts - if it can't pay it's debts the owners do not lose more than their share capital.

[Sunbelt Asia]

Assuming that Thailand has the same business laws as other countries I know, it's worth stressing that the owner of a sole proprietorship is personally responsible for the debts of the business, whereas an incorporated company can run up it's own debts - if it can't pay it's debts the owners do not lose more than their share capital.

Correct. All debts of the business are debts of the owner. A sole proprietor can be held personally liable for any business-related obligation. This means that if your business doesn't pay a supplier, defaults on a debt, or loses a lawsuit, the creditor can legally come after your house or other possessions.

Examples

Example 1: Khun Lek is the owner of a small printing business. When business prospects look good, she orders 1,000,000 worth of supplies and uses them in creating merchandise. Unfortunately, there's a sudden drop in demand for her products because the election was delayed, and Khun Lek now has a problem. When the company that sold Lek the supplies demands payment, she can't pay the bill. As sole proprietor, Lek is personally liable for this business obligation. This means that the creditor can sue her and go after not only Lek's business assets, but her personal property as well. This can include her house, her car, and her personal bank account.

Example 2: Tom is the owner of a restaurant. One day Khun Fawn, one of Tom's employees, is delivering food using a bike owned by the business. Fawn strikes and seriously injures a pedestrian. The injured pedestrian sues Fawn, claiming that she drove carelessly and caused the accident. The lawsuit names Tom as a co-defendant. After a trial, the jury returns a large verdict against Tom as owner of the business. Tom is personally liable to the injured pedestrian. This means the pedestrian can go after all of Tom's assets, business and personal.

Be sure to have insurance if you are a sole proprietorship!

www.sunbeltasiagroup.com

[sonicdragon]

Sorry to go a little off-topic, but does Thailand have laws making directors of a limited company personally responsible for the debts of the company if they knew that the business was insolvent when those debts were incurred ? "Wrongful Trading" as they call it in the UK... ? I'm guessing not. And presumably bankruptcy law gives less protection to creditors (no chapter 11 / administration or equivalent ?) - more good reasons to be incorporated if you run a business here.....

[wpcoe]

Sole Proprietorship

2,500 Baht for the sole proprietorship

Tax ID 3,000 Baht

DBA (Doing Business As) 1,600 Baht

19,500 For Amity Treaty

Government Fees are 25,400 For the Amity.

Government fees are 150 Baht for the sole proprietorship.

In case you're wondering, and even if you're not wondering <g>, I've decided it's a bit too expensive for me to try to be the point person/export assistant for my US friends' decorating business.

The above fees are B52,150. I also would have to pay B50,000 tax for last year, plus B46,800 (12 months of a B3,900 fee) to "rent" an "office" for a whopping (to me, anyway) B148,950 cash outlay for the first year, not including Sunbelt's professional fees (which I undoubtedly would use). That's a lot of Thai silk pillows I'd have to pawn on my friends just to break even on the start-up costs.

[Sunbelt Asia]

Sorry to go a little off-topic, but does Thailand have laws making directors of a limited company personally responsible for the debts of the company if they knew that the business was insolvent when those debts were incurred ? "Wrongful Trading" as they call it in the UK... ?

Yes they do.

The directors have limited liability if the promoters wanted them to have limited liability, when they formed the company. However fraud can make the directors to be charge criminally and civil as well.

In case you're wondering, and even if you're not wondering <g>, I've decided it's a bit too expensive for me to try to be the point person/export assistant for my US friends' decorating business.

This may be a good decision as operating a business is not for everyone. Many hobby businesses have found it can get expensive fast as can be easier to spend money then it is to make it.

www.sunbeltasiagroup.com