Reasons of change

[DarwinK]

My accountant tells me my Thai company can't just go and open a bank account in another country (like the UK or US). He says the company needs to apply for Bank of Thailand approval to have such an account. Anyone know about this--what's the process, how long does it take?

The reason I want the account is my customers often wish to pay using an overseas bank. Easiest way is to collect all payments in one account and transfer to Thai account when needed. For auditing purposes, I'd prefer to have all the accounts in the Thai company's name.

Thanks for any info on this, Darwin

[NHJ]

ring the banks and ask them what you need to open an account for a foreign company.

all banks have different rules so one may accept you while the other not.

[DarwinK]

ring the banks and ask them what you need to open an account for a foreign company.

all banks have different rules so one may accept you while the other not.

Just to clarify: I already have the commercial bank's agreement to open the account for my Thai company. What I want is the Bank of Thailand's approval for my Thai company to have a bank account in another country. Anyone know how to get Bank of Thailand's approval--what's the process? how long does it take?

According to my accountant, I can't just go open a foreign bank account in my Thai company's name.

[NHJ]

different countries have different rules, what your accountant seems to know does maybe not apply to the bank you target no matter the country you target.

never trust a source without checking the destination is a good thing to remember here.

only the overseas bank will be able to give you a clear answer.

[DarwinK]

different countries have different rules, what your accountant seems to know does maybe not apply to the bank you target no matter the country you target.

never trust a source without checking the destination is a good thing to remember here.

only the overseas bank will be able to give you a clear answer.

I'll try again, because you're missing the point. Unfortunately the overseas bank has no knowledge regarding the BoT's rules on overseas bank accounts. Whether or not the overseas bank decides to physically open the account is a mute point. So again:

1) My accountant says it's illegal (in Thailand) for a Thai company to open an overseas account without the BoT's approval. While my accountant may be wrong about Thai law, at this point, I'll take their word for it until I hear something credible from another source.

2) Assuming my accoutant is correct, then I'm asking: does anyone here know how to get BoT permission (as in you've done it before), and how long does it take?

[NHJ]

ok, now i get the point, the trouble is on the thai side of the law according to your accountant.

http://www.bot.or.th/english/Pages/BOTDefault.aspx will be a good start to seek informations.

[Old Man River]

different countries have different rules, what your accountant seems to know does maybe not apply to the bank you target no matter the country you target.

never trust a source without checking the destination is a good thing to remember here.

only the overseas bank will be able to give you a clear answer.

I'll try again, because you're missing the point. Unfortunately the overseas bank has no knowledge regarding the BoT's rules on overseas bank accounts. Whether or not the overseas bank decides to physically open the account is a mute point. So again:

1) My accountant says it's illegal (in Thailand) for a Thai company to open an overseas account without the BoT's approval. While my accountant may be wrong about Thai law, at this point, I'll take their word for it until I hear something credible from another source.

2) Assuming my accoutant is correct, then I'm asking: does anyone here know how to get BoT permission (as in you've done it before), and how long does it take?

Darwin, since local banks have contact with the BOT several times per day, ask a friendly banker in your Thai bank's Operations Dept. (back office) how to get in touch with the part of the BOT that covers opening offshore accounts. Ultimately, one of the Competent Authorities at the BOT will be the one signing off on the approval.

When you talk to them they can tell you approx. how long it will take and what documentation is needed or even if approval is needed (although I think it is).

[bino]

I'm not a Thai Accountant / financial genius, but Ms. bino is. She mostly agrees with your accountant. According to her:

Your customer invoices are subject to VAT, and that money must come to Thailand. If you want to open an account in another country to simplify the payment process for your customer, that is fine. However, the total value of your Thailand issued invoices would have to be transferred to a Thai Bank. You are effectively making the transfer same as your customer would have to do.

You will run seriously afoul if you collect Thai issued invoices overseas, and then use that money to pay overseas expenses / suppliers without repatriating it first because both of those transactions are subject to VAT.

Unless of course - you have some special arrangement / BOT status where they will examine and approve your overseas transactions (and trust you to pay the taxes due on the transactions!)

[bkkflyer]

But if you (like our company) only do export, you never charge any VAT. Sounds like a typical "Banana Republic" rule

[DarwinK]

I'm not a Thai Accountant / financial genius, but Ms. bino is. She mostly agrees with your accountant. According to her:

Your customer invoices are subject to VAT, and that money must come to Thailand. If you want to open an account in another country to simplify the payment process for your customer, that is fine. However, the total value of your Thailand issued invoices would have to be transferred to a Thai Bank. You are effectively making the transfer same as your customer would have to do.

You will run seriously afoul if you collect Thai issued invoices overseas, and then use that money to pay overseas expenses / suppliers without repatriating it first because both of those transactions are subject to VAT.

Unless of course - you have some special arrangement / BOT status where they will examine and approve your overseas transactions (and trust you to pay the taxes due on the transactions!)

Hi Bino, thank you and Ms. Bino for verifying this requirement.

Understood regarding the requirement to transfer the funds to a Thai bank.

I should add that this foreign account is entirely for managing our business (as mentioned above, a service business with an export component) and is in no way for getting around the Thai revenue department. We collect and pay VAT as required. If we can get the account open, all transactions involving the account will be audited by our Thai auditor. If there's other reporting requirements for the BoT, we'll of course comply with them.

Now to figure out how to get the approval. As Old Man River suggests, will start with our Thai bank manager when she's off vacation next week.

Cheers, Darwin

[moo9]

I'm not a Thai Accountant / financial genius, but Ms. bino is. She mostly agrees with your accountant. According to her:

Your customer invoices are subject to VAT, and that money must come to Thailand. If you want to open an account in another country to simplify the payment process for your customer, that is fine. However, the total value of your Thailand issued invoices would have to be transferred to a Thai Bank. You are effectively making the transfer same as your customer would have to do.

You will run seriously afoul if you collect Thai issued invoices overseas, and then use that money to pay overseas expenses / suppliers without repatriating it first because both of those transactions are subject to VAT.

Unless of course - you have some special arrangement / BOT status where they will examine and approve your overseas transactions (and trust you to pay the taxes due on the transactions!)

Hi Bino, thank you and Ms. Bino for verifying this requirement.

Understood regarding the requirement to transfer the funds to a Thai bank.

I should add that this foreign account is entirely for managing our business (as mentioned above, a service business with an export component) and is in no way for getting around the Thai revenue department. We collect and pay VAT as required. If we can get the account open, all transactions involving the account will be audited by our Thai auditor. If there's other reporting requirements for the BoT, we'll of course comply with them.

Now to figure out how to get the approval. As Old Man River suggests, will start with our Thai bank manager when she's off vacation next week.

Cheers, Darwin

Hi another maybe stupid question. Can a foreign company establish a THB bank account in Thailand to receive local payments which then will be transferred in USD to the headoffice bank abroard? Any good websites on import fanancing options you know of? Many times I feel like talking to a brick wall when discussing very specific banking requirements. Or I never found the right person to talk to.

Please PM me thanks

[Daveroc]

I'm not a Thai Accountant / financial genius, but Ms. bino is. She mostly agrees with your accountant. According to her:

Your customer invoices are subject to VAT, and that money must come to Thailand. If you want to open an account in another country to simplify the payment process for your customer, that is fine. However, the total value of your Thailand issued invoices would have to be transferred to a Thai Bank. You are effectively making the transfer same as your customer would have to do.

You will run seriously afoul if you collect Thai issued invoices overseas, and then use that money to pay overseas expenses / suppliers without repatriating it first because both of those transactions are subject to VAT.

Unless of course - you have some special arrangement / BOT status where they will examine and approve your overseas transactions (and trust you to pay the taxes due on the transactions!)

Hi Bino, thank you and Ms. Bino for verifying this requirement.

Understood regarding the requirement to transfer the funds to a Thai bank.

I should add that this foreign account is entirely for managing our business (as mentioned above, a service business with an export component) and is in no way for getting around the Thai revenue department. We collect and pay VAT as required. If we can get the account open, all transactions involving the account will be audited by our Thai auditor. If there's other reporting requirements for the BoT, we'll of course comply with them.

Now to figure out how to get the approval. As Old Man River suggests, will start with our Thai bank manager when she's off vacation next week.

Cheers, Darwin

Hi another maybe stupid question. Can a foreign company establish a THB bank account in Thailand to receive local payments which then will be transferred in USD to the headoffice bank abroard? Any good websites on import fanancing options you know of? Many times I feel like talking to a brick wall when discussing very specific banking requirements. Or I never found the right person to talk to.

Please PM me thanks

It is possible for overseas registered companies to open Bank accounts in Thailand.

Attached is the link to Bangkok Banks website outlining the documents required and the certification needed as these documents cannot be verified inside Thailand.

http://www.bangkokbank.com/Bangkok%20Bank/Business%20Banking/SMEs/Operating%20Accounts/THB%20Account%20for%20Company%20Registered%20Overseas/Pages/default.aspx

[EvilDrSomkid]

I'm not a Thai Accountant / financial genius, but Ms. bino is. She mostly agrees with your accountant. According to her:

Your customer invoices are subject to VAT, and that money must come to Thailand. If you want to open an account in another country to simplify the payment process for your customer, that is fine. However, the total value of your Thailand issued invoices would have to be transferred to a Thai Bank. You are effectively making the transfer same as your customer would have to do.

You will run seriously afoul if you collect Thai issued invoices overseas, and then use that money to pay overseas expenses / suppliers without repatriating it first because both of those transactions are subject to VAT.

Unless of course - you have some special arrangement / BOT status where they will examine and approve your overseas transactions (and trust you to pay the taxes due on the transactions!)

I would like some clarification on this.

We are also thinking of opening an offshore USD bank account in say Singapore. This account would be used for US customers paying for products manufactured and exported from Thailand. Goods for export are charged at 0% VAT.

Why would we have to repatriate the funds in the Singapore USD account to our our local account if we report all to the Thai authorities?

And why could we not use the funds in this account to pay for shipping charges, for instance?

Does our Co.Ltd need to get approval from the BoT to open a USD account in Singapore? Really?

Edited June 17, 2011 by EvilDrSomkid