Which Visa For Work Permit

[Phil Conners]

I'm currently here on a non-O visa (married to Thai) on third year. Haven't had to do a visa run during this time.

Now considering buying a business here and get a work permit.

Do I need to change my visa (to non- for this? I understand unless a business has a fully paid up 2M baht no 1 year extensions are given for non-B. Does that mean I would have to start doing visa runs every 3 months?

[Indo-Siam]

If you already have a long-term extension of a Class O visa, then you can get a work permit that matches that term of validity. To sponsor your work permit, the employing company needs only 2,000,000 baht REGISTERED capital per work permit sponsored - or 1,000,000 baht for each work permit sponsored for a foreigner married to a Thai.

My company would be happy to assist you with obtaining the work permit.

Good luck!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[Phil Conners]

Thanks Steve!

The company already has 2M baht registered capital and a couple of Thai staff. I would be the only farang in the company.

My non-O is up for renewal in April. Should I wait until then with buying the company and getting the WP or doesn't that matter?

Do you have a fixed price for obtaing the WP?

[Indo-Siam]

If you will be arranging to have seven of "your" shareholders buy all of a company's shares from "their" seven shareholders - then all that is involved above company level is submitting a Bor Or Jor 5 form listing new shareholders. You will also presumably want to change directors - which requires s memoradum of shareholders meeting, and some forms.

There are perils to buying another company - particularly if it hasfew or no assets. Remember that you inherit all obligations and liabilities of the acquired company - are you SURE they've never co-signed a loan, or terminated any employees who can come back and sue for severance pay? The more common approach is for you to form your own company, and then purchase just the listed assets of the other company. It takes a couple of weeks to start a company from scratch.

Including government fees, our charge to adminster registration of new shareholders, and changing of directors, would be around 5,000 baht. If you want us to go recover their most recent two years audited financials, and review them for potential problems, that would be another 4,000 baht.

I presume that the reason you are buying the other company is to take advantage of their paid-in capital. Do be aware - if company has very weak balance sheet, no liquid assets at the time you acquire it, and negigiblerecent income, you may encounter problems - Revenue department can withdraw your tax registration, and your work permit can be disapproved - unless you inject cash via a capitalization increase, and pay-in of fresh capital.

At any rate, you need to have an employment letter from the company, plus copies of their registration documents, and their recent tax payment receipts, to apply for the work permit. Depending on how long before your entry permit expires, maximum work permit fee is 3,100 baht to government, 7,000 baht to us.

Other things you need: Medical exam certificate, two 5 x 6 cm photos (color, full-face, light background - best to wear a necktie), copy of university transcript or diploma. We would also need you to complete a personal history form - which we then use to prepare the application. Send me conventional e-mail to which I can reply with attachment, and I'll send it to you.

Cheers!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[Phil Conners]

The current shareholders are probably all staff from the legal office who created the company, with undated resignations etc, as I believe is customary. If this is the case wouldn't it normally just be a matter of changing director ?

Regarding liabilities, I'm only as SURE as anyone can be - I rather trust the current owner who I have known for close to two years and who have a good reason for selling.

Anyway, seing the creation of companies advertised on this forum for 2,500 perhaps the cheapest and safest solution would be to simply setup a new company and have it take over the original company?

Although this is a 2M reg. company there is no paid-up capital other than some limited physical assets (leasehold, office furniture). The real assets are cash flow and client base. The company finances have been managed by a registered accountant for years and is fully up to date with taxes etc. The company has two (real) Thai employees, perhaps a couple of "ghost" employees, I'm not sure.

AFAIK the current owner/director doesn't have a degree or diploma, is that needed to be the MD for your own Thai company?

Please keep in mind that I already have a non-O visa third year uninterrupted and intent to apply for a residence permit next year so I don't want to interrupt my current stay by changing visa type and possible invalidate my 3 years uninterrupted stay.

[Sunbelt Asia]

Hi Madsere,

You sent me a PM asking my comments on this thread.

I have no problem doing that but we want to urge you to please consider Steve to handle your case rather than us in this case as he already has answer a number of posts. This may seem strange but for the record, our company respects service providers like Indo Siam. We in fact wish there were more companies like Steve.

As to my comments..

AFAIK the current owner/director doesn't have a degree or diploma, is that needed to be the MD for your own Thai company?

No need for a degree or diploma. In fact a resume is all that is needed at this time. No letter of references, etc.

The current shareholders are probably all staff from the legal office who created the company, with undated resignations etc, as I believe is customary. If this is the case wouldn't it normally just be a matter of changing director ?

VERY dangerous to do this unless their are two classes of shares,your shares have more voting rights and the By-laws have been change that the share register is the MD. Otherwise you could be voted out and even kicked out of your own company

Regarding liabilities, I'm only as SURE as anyone can be - I rather trust the current owner who I have known for close to two years and who have a good reason for selling.

Sorry but wish I had 100 Baht for every time I have heard this. Don't trust anybody. Trust only a GOOD lawyer or service provider that will be looking after you.

Anyway, seing the creation of companies advertised on this forum for 2,500 perhaps the cheapest and safest solution would be to simply setup a new company and have it take over the original company?

Forming a new company is the best way to acquire the assets of the existing business. Who knows about the sleeping skeletons in the closet of claims against the company from suppliers, customers, employees. You would be responsible if their were errors in prior tax filings as well.

Your odds of getting a wp are almost 100% with a new form company rather than using the same company formation as the existing company, it just depends on their finances and the discretion of the officier.

Also you have tax advantages by doing a asset purchase. You can depreciate the assets and goodwill with an asset purchase as deductions will be based on the portion of the purchase price allocated to the particular class of asset. You will be able to maximize the availability of tax deductions in subsequent years.

With a share purchase,you will inherit the corporation's undepreciated capital cost for each class of asset. Deductions in future years will be based on this. If your friend just has computers, the depreciation has already been used up after 3 years while with an asset purchase it starts again from day 1 for your new company. Goodwill you cannot depreciate with a share purchase till you sell.

Also big difference in employees with a share purchase versus asset purchase.

Share purchase...You are liable for severance from when they first joined the company not when they started working for you.

With an asset purchase, you can pick and choose who you want to work for you and the seller is responsible for the severance. You can immediately hire the employees you want to keep. They then start on probation when they are hired by you.

If your friend insist on the share purchase, one solution, he signs an agreement to indemnify you for any claims after the purchase that relates to when he owned the business. He agrees to share the tax savings with you due to his tax savings and to compensate you for the lost tax deductions. The potential compensation would be around 15% from the already agreed purchase price if you buy the shares. He also agrees to set aside 200,000 Baht for a period of 3 years after closing in your lawyers escrow to deal with potential claims that may arise. This is just one way we in the past have reached an compromise for the buyer wanting to do an asset purchase and the seller insisting on a share purchase.

You as the buyer want the asset purchase agreement.

Please keep in mind that I already have a non-O visa third year uninterrupted and intent to apply for a residence permit next year so I don't want to interrupt my current stay by changing visa type and possible invalidate my 3 years uninterrupted stay.

This has zero bearing on you getting a work permit or hurting your chance of getting your "O" visa renewed.

Il ike to add, be sure to have a lawyer prepare a asset purchase or if you decide to use it, a share purchase agreement. As a reference, our legal staff professional fee for the asset purchase is 9,500 Baht and 19,500 Baht for the share purchase agreement.

Here are just SOME of the issues covered such as Non-Competition, No-Solicitation of employees.

As well as the Sellers obligations prior to closing in regards to covenants, restrictions and obligations such as No sale or encumbrance of the company’s assets, continuing operations of the Business, affirmative covenants concerning operations, negative covenants concerning operations, new transactions, preservation of the company’s Business; maintenance of insurance.

Sellers’ indemnification of buyer, Buyers' indemnification of seller,

Any hold-back, post closing adjustment, release of holdback amount

Representations and warranties of the buyer. Representations and warranties of the seller.

Closing and closing procedures.

Conditions precedent to closing

Purchase price...Withholding for taxes, Payment of Consideration.

The whole key to a contract is solving any issues that may come up after the closing. Otherwise you may lose a friend.

www.sunbeltasia.com

[Phil Conners]

Thank you!

With all respect, I like to have more than one opinon on important issues, then make my decision from what I learn. Your reply confirmed the benefit of this.

[Rags]

If you already have a long-term extension of a Class O visa, then you can get a work permit that matches that term of validity.  To sponsor your work permit, the  employing company needs only 2,000,000 baht REGISTERED capital per work permit sponsored - or 1,000,000 baht for each work permit sponsored for a foreigner married to a Thai.

My company would be happy to assist you with obtaining the work permit.

Good luck!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

<{POST_SNAPBACK}>

Hi there,

Sorry for hijacking this 'company related' thread, but I am interested in Indo-Siam's above response regarding work permit requirements.

I too have a Thai wife and an extended non-imm-O visa, and I would greatly appreciate clarification of the requirements for obtaining a work permit as an employee of a local company.

Is the above mentioned reduction in registered capital (from 2M registered capital to 1M) the only benefit afforded by the non-imm-O as opposed to the non-imm-B...?

Regards

Rags

[Indo-Siam]

If you already have an entry permit extended on the basis of supporting a Thai spouse, then you have noi need to meet any of the Immigration requirements for an entry permit extension (EPE) on the basis of "qualifying employment for a qualifying employer" - which include 2,000,000 baht paid-in capital and four Thai employees per foreign employed. You also do not need to meet the monthly salary minimum of 50,000 or 60,000 baht (depending on your nationality).

The only two things you need are:

1) To get work permit, company needs 2,000,000 baht registered capital per each foreigner employed who does not have a Thai spouse, plus 1,000,000 baht registered capital for every foreigner employed who does have a thai spouse.

2) You need to be paying personal income taxes and depositing net salary into a Thai bank account amounting to approximately 40,000 baht per month.

Class O visa is accepted routinely as basis for a work permit.

Also - for an entry permit issued against either a Class O or Class B visa - either one of these non-immigrant enytry permits can be extended on the baisis of EITHER "support of a Thai spouse" or "qualifying employment for a qualifying employer" - there is no such thing as "changing the Classification category from B to O," or the reverse. You simply follow the documentation procedure for the basis you are using, irrespective of what the underlying original visa was, originally.

Good luck!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

Skype: sykesbkk

[astral]

To sponsor your work permit, the  employing company needs only 2,000,000 baht REGISTERED capital per work permit sponsored - or 1,000,000 baht for each work permit sponsored for a foreigner married to a Thai.

<{POST_SNAPBACK}>

If someone takes this route, and then the Thai spouse dies, what happens?

Does the company suddenly need another 1m baht capital,

or do they have to sack the guy?