Company Closed

[Flow]

A friend started a limited company. 12,000 Baht was the amount he paid the Thai accountant for everything.

A year later he decided that he wanted to close the company. The accountant asked 15,000 Baht. 2 years after he had opened his biz and 1 year after he had closed is, the accountant faxed him a bill for 3,600 Baht. 3600 Baht for..... what? the accountant replied that she had to fill in some form on a monthly basis and send it with a messenger to some government office - 300 Baht x 12. She said "this is the law". My friend was never informed that there would be other bills coming his way for filing some form with some office after legally closing the company down. He called me just now asking for advice. Advice I can't give, because I have never heard of this before. Should he pay the accountant the 3,600 Baht she's asking or is she just milking him for more Bahts - anyone with some input on the topic?

Thanks

Edited May 22, 2007 by Flow

[taxout]

I can't address Thailand specifically, but in the West there are normally on-going legal requirements to keep a corporation in good standing and an accountant or other specialist is normally used to meet these requirements. "Company secretarial services" they're usually called.

And yes, winding-up a company usually involves more fees.

Edited May 22, 2007 by taxout

[bander]

Your friend is lucky, my accountant asked for 40.000 to close my company. (include balance sheet and tax clarence) Same price I payed to open it.

I was told if I didn't pay up and close it the police was going to be involved.

This was 3 years ago, haven't payed nothing and not seen anything to the law.

As far as I know the company is still running.

[Maestro]

Taxout and bander, it seems to me that you are both off topic. Flow talks about a company that has already been closed one year ago and wonders why the accountant sent a bill one year after the closing, allegedly for the submission of a form every month for 12 months after the closing of the company.

Flow, tell your friend to ask the accountant for photocopies of the 12 monthly forms that were allegedly submitted on behalf of his closed company. Did the accountant perhaps not really close the company?

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Maestro

[TheNightCat]

In Thailand there is no REAL need to close a company and pay for this (by law yes and by law no???) but you need to follow some simple steps that are according to Thai law and its fully legal and not harmfull.

1) Tell your accountant that you don't want to use them/her/him anymore - get them to sign a document that you don't owe them anything and that all accounting bills are paid for.

2) Go to the company bank and close all Bank accounts

3) As a LTD. company you need to file Audited Accounts each year, no matter if you are trading or not (dormant) and this cost about 15,000 Baht/year, but if you don't send this in to the IR department, then you will be in default and are religable for a fine of maybe 50,000 Baht and jail....

4) But this is ONLY if you wich to trade and as you plan to close the company anyway, just just do nothing....

5) On the second year (after April) you will again be liable for filing the Annual Audited accounts, but as Cityhall does not get such returns, they will strike your company off the register automatically and this does not cost a penny and no fines are issued. - but be carefull, if you after one year find out that you still want to use your company, then you're in trouble.

This is the same in almost any country in the world and is not a crime unless you have debt in your company, then its a diffrent matter. So make sure you have no registered debt, and oh yes, close your company bank account in good time!!! Another thing, you can't have ANY company assets like land, house etc.

Edited May 23, 2007 by MISOLIMA

[Flow]

Great info

Thanks for the replies

[eagle1]

Dear Flow,

Under Thai laws, even you register to closed the company with Ministry of Commerce, it does not mean that the company is eally close. After registration for closing company, you again have to register for liquidation the company. The law is quoted that "A company is deemed to continue after its dissolution as far as it is necessary for the purpose of liquidation." Hence, from your info, I have some queries;

1. Has your friend's company registered for liquidation?

2. If so, monthly accounting service shall not have. However, if the company does not resgiter for liquidation yet, the next question is that whether your friend's company have registered for VAT. If yes, your accountant is right.

To solve the problem, I would advise you to check both queried above. If it is not done, then my advise is:

1. To revoke VAT at Revenue Deaprtment.

2. To register for company liquidation.

Any further queries, please feel free to PM me at [email protected]

Best regards,

Ekkapon Y