Thai Staff Requirement

[Dazzler]

I am setting up a consultancy company with 3 partners which will be majority american owned.

1. Is it true that for every work pemit issued there will need to be four thai full time employees?

2. Bt2 million will need to be paid up?

Does anyone know of any legal loopholes around these 2 requirements?

As a specialist consultancy, we do not need 12 thai staff in the short to medium term!!

Thanks to anyone that can help.

[Forkinhades]

I though it was 6, My friend has '6' just names basically, where you pay a very mimimum wage, and healthcare, it dosnt work out to much each month, and can be claimed back on tax.

You do not need 2mill baht to set up a 2 mill baht company, probably around 30,000 baht in the present climate, FBA rules etc,

Thats the easy bit, getting the work permit, is very difficult now, you have to show your skills, not like before

Edited April 25, 2007 by Forkinhades

[Dazzler]

Thanks Forkinhades; dont understand the reference to Bt30,000 though?!

[Cyberstar]

1. Is it true that for every work pemit issued there will need to be four thai full time employees?

No, it isn't true! ... Well, at least neither in Bangkok (were zero will do) nor in Chiang Mai (where one suffices) ... In which province are you going to register your company?

[Forkinhades]

Thanks Forkinhades; dont understand the reference to Bt30,000 though?!

thats about what it would cost to pay a lawyer to set up a 2mill baht company for you, used to 15-20,000 but with the FBA laws, it has generated a lot more paperwork.

[Crossy]

You should contact Sunbelt (a respected forum sponsor) to assist you in your setup, their fees are very reasonable for the vast knowledge you then have access to.

AFAIK It's not the work permit that requires Thai staff it's the extension of stay on the grounds of business.

[Dazzler]

Just to clarify....

I am not setting up a Bt2million business; but I have been told by a couple of lawyers informally that for EACH farang director/shareholder issued a work permit there will need to be:

Bt2 million paid up capital

4 thai employees

Cyberstar, the business will be registered in and operate out of Bangkok. Can you provide me with your source stating that no Thai employees are needed related to each work permit, or is it information you have from a lawyer, anecdote or experience?

Crossy: Regarding: "It's not the work permit that requires Thai staff it's the extension of stay on the grounds of business". Can you explain? Once I have a work permit I obviously have to stay on the grounds of business?!

[StateSix]

Just to clarify....

I am not setting up a Bt2million business; but I have been told by a couple of lawyers informally that for EACH farang director/shareholder issued a work permit there will need to be:

Bt2 million paid up capital

4 thai employees

Cyberstar, the business will be registered in and operate out of Bangkok. Can you provide me with your source stating that no Thai employees are needed related to each work permit, or is it information you have from a lawyer, anecdote or experience?

Crossy: Regarding: "It's not the work permit that requires Thai staff it's the extension of stay on the grounds of business". Can you explain? Once I have a work permit I obviously have to stay on the grounds of business?!

I assume that you will initially have a 1 year multiple entry non immigrant B visa, meaning that you will have to exit the country every 90 days. Once you receive your work permit you can apply for a 1 year extension of stay, based on the fact that you have a business. This means that you are permitted to stay for 1 year without the need to exit the country. To get this you need 4 Thai staff per person. If you dont have the 4 Thai staff, you just stay under the B visa, and do visa runs every 90 days.

[Dazzler]

I assume that you will initially have a 1 year multiple entry non immigrant B visa, meaning that you will have to exit the country every 90 days. Once you receive your work permit you can apply for a 1 year extension of stay, based on the fact that you have a business. This means that you are permitted to stay for 1 year without the need to exit the country. To get this you need 4 Thai staff per person. If you dont have the 4 Thai staff, you just stay under the B visa, and do visa runs every 90 days.

StateSix:

I currently have a multi entry Non-Imm B visa expiring in August. Are you saying that to be a director (and shareholder) of a business I do not need a work permit? Once I get a work permit must I take on the Thai employees? Can I just choose the B visa ad infinitum or I decide the company has sufficient business/need for 4 Thai employees?

Overall then, can I choose to have the hassle of the 90 day visa trip, or take on 4 Thai employees?

[StateSix]

Dazzler,

The B visa gives you the right to stay in Thailand for 1 year, but that you have to leave every 90 days.

If you want to work while you are here then you will need a work permit also.

Once you have the work permit you can:

a) apply for a 1 year extension of stay. For this to be granted you need 4 Thai staff and it means you do not need to leave the country every 90 days.

continue under your B visa, and leave every 90 days.

The B visa gives you the right to stay in Thailand for the specified time and the work permit gives you the right to work legally.

Hope this clarifies things.

[Dazzler]

StateSix.

Thanks.

Can I get my work permit, continue on my B visa and leave thailand every 90 days; and not need to employ the 4 Thai staff?

[Sunbelt Asia]

I am setting up a consultancy company with 3 partners which will be majority american owned.

1. Is it true that for every work pemit issued there will need to be four thai full time employees?

2. Bt2 million will need to be paid up?

Does anyone know of any legal loopholes around these 2 requirements?

As a specialist consultancy, we do not need 12 thai staff in the short to medium term!!

Thanks to anyone that can help.

Only if you are setting up a sole propriorship, will you need 4 Thai employees per foreigner to acquire a work permit. ( 2 Thai employees per work permit if the foreigner is married to a Thai) This is per the Department of Employment Regulations Governing the Criteria of Considering Permitting the Work of Foreigners A.D. 2004

If a Limited partnership or Limited Company is the employer, no Thai employees are required to get a work permit in Bangkok. ( Some districts like Chaing Mai require 1 Thai employee)

You are not able to apply for an extension of stay based on business until Jan 2008 at the earliest as you need an annual audit and balance sheet. You will have need to show this criteria (your gross sales in 2007 will need to be higher than your foreigner salaries in 2008, as well the companies mininum net equity must be at least one million baht.)

As you will not even be able to apply for the extension of stay permit based on business until 2008, the requirement of 4 Thais is a non issue until then. In the meantime you simply will be using your multi entry visa and the work permit.

As for the 2 million Baht paid up capital, this is a non issue for a sole proprietorship. For a Limited Partnership or Limited Company, the shares can be fully paid up with equipment, service as well as cash. It is not required under the Civil Commercial Code; the shares need to be paid up with only cash.

www.sunbeltasiagroup.com

[Sunbelt Asia]

Can I get my work permit, continue on my B visa and leave thailand every 90 days; and not need to employ the 4 Thai staff?

Yes

With one exception, if your employer is a recently formed sole propriorship ( then you will need 4 Thai employees in this case, married would be 2 Thai employees.)

www.sunbeltasiagroup.com

[kiakaha]

I am setting up a consultancy company with 3 partners which will be majority american owned.

1. Is it true that for every work pemit issued there will need to be four thai full time employees?

2. Bt2 million will need to be paid up?

Does anyone know of any legal loopholes around these 2 requirements?

As a specialist consultancy, we do not need 12 thai staff in the short to medium term!!

Thanks to anyone that can help.

Only if you are setting up a sole propriorship, will you need 4 Thai employees per foreigner to acquire a work permit. ( 2 Thai employees per work permit if the foreigner is married to a Thai) This is per the Department of Employment Regulations Governing the Criteria of Considering Permitting the Work of Foreigners A.D. 2004

If a Limited partnership or Limited Company is the employer, no Thai employees are required to get a work permit in Bangkok. ( Some districts like Chaing Mai require 1 Thai employee)

You are not able to apply for an extension of stay based on business until Jan 2008 at the earliest as you need an annual audit and balance sheet. You will have need to show this criteria (your gross sales in 2007 will need to be higher than your foreigner salaries in 2008, as well the companies mininum net equity must be at least one million baht.)

As you will not even be able to apply for the extension of stay permit based on business until 2008, the requirement of 4 Thais is a non issue until then. In the meantime you simply will be using your multi entry visa and the work permit.

As for the 2 million Baht paid up capital, this is a non issue for a sole proprietorship. For a Limited Partnership or Limited Company, the shares can be fully paid up with equipment, service as well as cash. It is not required under the Civil Commercial Code; the shares need to be paid up with only cash.

www.sunbeltasiagroup.com

So for an existing limited company in bangkok, if we wanted to hire a foreigner and get a work permit for that foreigner and that foreigner wouldn't be requiring extension of stays(just use multi entry visa), then the thai to foregner ratio is a complete non-issue ? Am I correct ?

[Sunbelt Asia]

So for an existing limited company in bangkok, if we wanted to hire a foreigner and get a work permit for that foreigner and that foreigner wouldn't be requiring extension of stays(just use multi entry visa), then the thai to foregner ratio is a complete non-issue ? Am I correct ?

Correct.

www.sunbeltasiagroup.com

[kiakaha]

So for an existing limited company in bangkok, if we wanted to hire a foreigner and get a work permit for that foreigner and that foreigner wouldn't be requiring extension of stays(just use multi entry visa), then the thai to foregner ratio is a complete non-issue ? Am I correct ?

Correct.

www.sunbeltasiagroup.com

Can you keep renewing your work permit without doing 1 yearly extension of stays, but rather coming and going on your multi entry.It would result in more WP renewals each year(every 90 days as opposed to every year), so maybe a tad more expensive, but nethertheless, is this a legitimate and legal option ?

[Sunbelt Asia]

Can you keep renewing your work permit without doing 1 yearly extension of stays, but rather coming and going on your multi entry.It would result in more WP renewals each year(every 90 days as opposed to every year), so maybe a tad more expensive, but nethertheless, is this a legitimate and legal option ?

You only need to renew your work permit every 6 months or one year ( This is on page 5 of the work permit). The date when your work permit expires on another page of the work permit, will require a " revalidation" This requires showing your passport and your new 90 day stamp. Renewals or revalidations are unlimited.

www.sunbeltasiagroup.com

[brianinbangkok]

So for an existing limited company in bangkok, if we wanted to hire a foreigner and get a work permit for that foreigner and that foreigner wouldn't be requiring extension of stays(just use multi entry visa), then the thai to foregner ratio is a complete non-issue ? Am I correct ?

Correct.

www.sunbeltasiagroup.com

So what if that foreigner has no need for extensions of stays or any visa at all because he has a Certificate of Residence here in Thailand ?

Does this mean that a foreigner with a residents certificate has an advantage in this case starting a company with no need for Thai staff or working for a company without that company having to show 4 Thai staff for him ?

Edited April 26, 2007 by brianinbangkok

[Sunbelt Asia]

So what if that foreigner has no need for extensions of stays or any visa at all because he has a Certificate of Residence here in Thailand ?

Does this mean that a foreigner with a residents certificate has an advantage in this case starting a company with no need for Thai staff or working for a company without that company having to show 4 Thai staff for him ?

If he was the only foreigner, yes. ( Other foreigner may then need 8 Thai employees to get the extension of stay based on business. 2 work permits equal 8 Thai employees even if one has a residence) The same advantage can be said for someone with a extension of stay based on being married to a Thai or a extension of stay based on retirement ( yes in some cases, they have gotten work permits) or a extension of stay based on education or even a extension of stay based on investment. None of these extension of stay permits need 4 Thai employees to get a work permit as well as the requirement to travel every 90 days.

www.sunbeltasiagroup.com

[cosmont]

So what if that foreigner has no need for extensions of stays or any visa at all because he has a Certificate of Residence here in Thailand ?

Does this mean that a foreigner with a residents certificate has an advantage in this case starting a company with no need for Thai staff or working for a company without that company having to show 4 Thai staff for him ?

If he was the only foreigner, yes. ( Other foreigner may then need 8 Thai employees to get the extension of stay based on business. 2 work permits equal 8 Thai employees even if one has a residence) The same advantage can be said for someone with a extension of stay based on being married to a Thai or a extension of stay based on retirement ( yes in some cases, they have gotten work permits) or a extension of stay based on education or even a extension of stay based on investment. None of these extension of stay permits need 4 Thai employees to get a work permit as well as the requirement to travel every 90 days.

www.sunbeltasiagroup.com

Hi Sunbelt,

I have one question regarding my situation.

I am director and shareholder of a Thai Limited company of 2 Millions Baht capital (only 400.000B paid).

This company have 3 years activity and pay taxes every years.

I have "O" visa with extension of stay based on 3M Baht investment.

Is it possible to get a work permit ? (only one thai staff)

Otherwise, do I have to change my visa from "O" to "B" ?

Thank you for your answer.

Best regards.

[JR Texas]

JR Texas to SUNBELT: The last time I looked at the list of occupations that are prohibited, "consultant" was on the list.

[Mid]

Mid to JR : define consultant , like wise occupation ...............

does not money be required to change hands ?

or are we all consultants ?????????

[JR Texas]

Mid to JR : define consultant , like wise occupation ...............

does not money be required to change hands ?

or are we all consultants ?????????

JR Texas to Mid: I am serious.......I think "consultant" was on the most recent list of prohibited occupations, along with engineer and virtually all other possible jobs.

Of course, how I define consultant is irrelevant. The important point is how the govt. defines it.

My limited understanding is that people can get around the "new law" by re-defining their job function, from consultant to something like "specialist on integrating 21st century technology based on BS multiplied by pie."

Something not on the prohibited list..........I think you get my meaning.

Still, given that working as a consultant is now prohibited, I do not see how a foreign firm can set itself up in Thailand as a consultancy or have that word inserted in the business permit or company name.

[Mid]

Mid to JR : define consultant , like wise occupation ...............

does not money be required to change hands ?

or are we all consultants ?????????

JR Texas to Mid: I am serious.......I think "consultant" was on the most recent list of prohibited occupations, along with engineer and virtually all other possible jobs.

Of course, how I define consultant is irrelevant. The important point is how the govt. defines it.

My limited understanding is that people can get around the "new law" by re-defining their job function, from consultant to something like "specialist on integrating 21st century technology based on BS multiplied by pie."

Something not on the prohibited list..........I think you get my meaning.

Still, given that working as a consultant is now prohibited, I do not see how a foreign firm can set itself up in Thailand as a consultancy or have that word inserted in the business permit or company name.

thanxs ,

I'll defer to Sunbelt for this ..................

grandfathered maybe .............

[Crossy]

Mid to JR : define consultant , like wise occupation ...............

does not money be required to change hands ?

or are we all consultants ?????????

JR Texas to Mid: I am serious.......I think "consultant" was on the most recent list of prohibited occupations, along with engineer and virtually all other possible jobs.

Of course, how I define consultant is irrelevant. The important point is how the govt. defines it.

My limited understanding is that people can get around the "new law" by re-defining their job function, from consultant to something like "specialist on integrating 21st century technology based on BS multiplied by pie."

Something not on the prohibited list..........I think you get my meaning.

Still, given that working as a consultant is now prohibited, I do not see how a foreign firm can set itself up in Thailand as a consultancy or have that word inserted in the business permit or company name.

I'm a 'Specialist' (I think 'Expert' is also OK) which worked last year when I got my last WP, we'll be finding out fairly soon if it still works. I am really a Consultant Engineer, which apparently won't now work, the company offer 'Project Management and Engineering Services' which is (AFAIK) still OK

No mention of consultancy or engineering in the company name, just a subtle reference to 'infrastructure'.

Edited May 22, 2007 by Crossy

[Sunbelt Asia]

Is it possible to get a work permit ? (only one thai staff)

yes

Otherwise, do I have to change my visa from "O" to "B" ?

no

The last time I looked at the list of occupations that are prohibited, "consultant" was on the list.

It is not on the list of 39 occupations for Alien Employment Act B.E. 2521 (1978) (Department of Employment) except as a consultant in architecture or engineer. Hence you cannot be a general consultant because you may be doing architecture or in engineering consulting. But you can be a consultant in mfg, consultant in restaurants, in law, etc. We have many clients getting a work permit as a consultant every month.

Still, given that working as a consultant is now prohibited, I do not see how a foreign firm can set itself up in Thailand as a consultancy or have that word inserted in the business permit or company name.

They are.

www.sunbeltasiagroup.com

[JR Texas]

Is it possible to get a work permit ? (only one thai staff)

yes

Otherwise, do I have to change my visa from "O" to "B" ?

no

The last time I looked at the list of occupations that are prohibited, "consultant" was on the list.

It is not on the list of 39 occupations for Alien Employment Act B.E. 2521 (1978) (Department of Employment) except as a consultant in architecture or engineer. Hence you cannot be a general consultant because you may be doing architecture or in engineering consulting. But you can be a consultant in mfg, consultant in restaurants, in law, etc. We have many clients getting a work permit as a consultant every month.

Still, given that working as a consultant is now prohibited, I do not see how a foreign firm can set itself up in Thailand as a consultancy or have that word inserted in the business permit or company name.

They are.

www.sunbeltasiagroup.com

JR Texas: I stand corrected and thanks for the information. It makes sense to ban foreign consultants that specialize in engineering and architecture given the structural soundness of the buildings in Thailand (they never collapse) and excellent quality of the airport structures (there are never any cracks in the runways). :D

[Sing_Sling]

As we go deeper into he mire of labor and permit regulations, may I go off on a tangent . . .

We were discussing 'consultants' . . .does Thailand still impose the 30% withholding tax on money sent out of the country?

An example . . . if I receive an invoice for consulting services, can I fulfill that invoice by transferring the funds without any export penalty?

cheers

[Sunbelt Asia]

As we go deeper into he mire of labor and permit regulations, may I go off on a tangent . . .

We were discussing 'consultants' . . .does Thailand still impose the 30% withholding tax on money sent out of the country?

An example . . . if I receive an invoice for consulting services, can I fulfill that invoice by transferring the funds without any export penalty?

cheers

If a foreign company sent you the invoice ....Gross receipts sent to the foreign company would be taxed at 15%

If its a individual that sent the invoice for consulting, it would be 3% witholding tax.

www.sunbeltasiagroup.com

[Sing_Sling]

Thank you. Wouldn't the individual have to be some sort of company to send an invoice for consulting? Or could this individual be a sole proprietorship? Or even just a person without a registered company?

Edited May 26, 2007 by Sing_Sling