Need Advice On Sole Proprietorship For Thai National

[BigEnigma]

I have been trying to help a Thai friend of mine start up a small t-shirt printing business. He works from his house and gets all of his business from the internet.

After reading about the different Thai business entities, I thought for a guy just getting started, with little or no assets, the best choice would be as a Sole Proprietor.

I set up a meeting with a lawyer today, and he more or less told my friend that he would have to set up a Limited Liability Company. The Sole Proprietorship wasn't an option?

We are wondering if that is only because they can charge much more for their services with the Corporation?

Can anyone tell me the pros and cons of the Sole Proprietor type business? For example, can they get a business bank account, and do they get some of the same tax benifits, like deductions for supplies, and vehicle used for business? I would appreciate any information and advice.

[raro]

moved to SME Forum

[samran]

when I set up one of my businesses I originally looked to set up a sole proprietorship.

There are advantages - between 70% and 90% of revenues can be automatically be written off as costs, depending on category. The benefit of this is that it minimises the need for record keeping and administrative costs.

The down side is that you are open up to liability - which for me would become an issue.

A company will limit that liablity to the company of course (with recourse to the directors), and for SME's in Thailand, provide low-ish tax rate - which is a bonus.

The admin side is that you'll need to employ and accountant to take care of and sign off on the books (for me, a cheap accountant is 3000 per month for freelancer + an annual 20,000 audit fee). Company from memory cost 20K to set up, using Thai accountant.

It depends how much he is looking at making, and how comfortable he is taking on liability.

[Gone]

Not to seem intrucive but if he/she is Thai why are they looking for help from a farang?

With akk due respect, if I was back in Canada and wanted to start a business I would not as a foreigner. I would talk with other Canadians or other people who have done the same thing basically or even with a few different Canadian lawyers.

Not sure where you are located but I'm sure your friend could as other Thais about the best way? Thai rak Thai.

[robblok]

Gone

Not all Thais are well educated and lawyers and accountants usually are not that independent they try to make a buck off you, so they would advise him in a way it would make the most money for them.

I seen this happen before, and if he has no friends that know the real deal why not ask a farang we can find things out too.

[Gone]

Yes I understand about not all Thais being educated etc. and the lawyer thing was just a suggestion however his Thai friend weather it is a man or woman could certainly ask locals regarding their already established businesses. I am not saying the OP should NOT ask here, only was curious as most Thais seem to do just fine without foreigners advice. They normally also have large families for advice as well.

I say good on the OP for trying to help.

[robblok]

Yes I understand about not all Thais being educated etc. and the lawyer thing was just a suggestion however his Thai friend weather it is a man or woman could certainly ask locals regarding their already established businesses. I am not saying the OP should NOT ask here, only was curious as most Thais seem to do just fine without foreigners advice. They normally also have large families for advice as well.

I say good on the OP for trying to help.

To be honest i have asked Thais advice about stuff. The moment its about legal stuff or accounting stuff most don't know much about it. If i were to ask it at my wives relatives im sure non of them knew much about setting up a business.

Thing is here lawyers are often out there for themselves, i lost money that way too. If i had done some research it would have been a lot better. Was told i did not need 4 Thais for a workpermit ect. The guy just wanted to set up a company and do the accounting.

[samran]

Not to seem intrucive but if he/she is Thai why are they looking for help from a farang?

With akk due respect, if I was back in Canada and wanted to start a business I would not as a foreigner. I would talk with other Canadians or other people who have done the same thing basically or even with a few different Canadian lawyers.

Not sure where you are located but I'm sure your friend could as other Thais about the best way? Thai rak Thai.

i answered the question....what is the problem?

[robblok]

Not to seem intrucive but if he/she is Thai why are they looking for help from a farang?

With akk due respect, if I was back in Canada and wanted to start a business I would not as a foreigner. I would talk with other Canadians or other people who have done the same thing basically or even with a few different Canadian lawyers.

Not sure where you are located but I'm sure your friend could as other Thais about the best way? Thai rak Thai.

i answered the question....what is the problem?

Samran i like your humor. Wonder if they get it.

[Gone]

No problems. It is called a "discussion" forum.

[samran]

No problems. It is called a "discussion" forum.

All backed with experience in this case.

[TravelerEastWest]

....There are advantages - between 70% and 90% of revenues can be automatically be written off as costs, depending on category. The benefit of this is that it minimises the need for record keeping and administrative costs.

The down side is that you are open up to liability - which for me would become an issue....

The tax advantages and simplfied recordkeeping are an enormous advantage for a small startup.

With part of your tax savings you can purchase insurance.