Capital requirements for limited company

[jimmiejackson]

Hi,

I have a quick question about registered capital for a Thai Limited Company.

Many years back I set up a Thai Co.,Ltd and due to needing 2 work permits we registered with a capital of 4 million Baht. As was usual at that time no money changed hands and an immediate 4 million Baht loan was made to the Directors.

I understand this has recently changed? My wife (Thai) wants to open a Co.,Ltd with the view to perhaps later employing a foreigner (who is married to a Thai National).

I understand the registered capital requirement in this case to obtain a work permit in Bangkok would be a minimum of 1 Million Baht.

Is it possible still to open the company with 1 Million Baht of registered capital without 1 million Baht ever needing to be physically moved into the company?

Looking forward to your kind advice.

For those following other threads, I did ask this under "ask the lawyer" but unfortunately he didn't answer the part about whether the capital actually needs to be "paid up" or merely "registered" and as he got the part about the Thai staff requirements for foreigners wrong I think it's better to ask the community first.

Edited February 28, 2015 by jimmiejackson

[BlackJack]

he didnt answer because hes a Lawyer

do you think a lawyer is going to put on paper

yeh go ahead its OK to break the law

[chingmai331]

You're mean.

[khunPer]

I was told the same – no money needed – when I establish a company some 10 years back. But I think that when they changed the rules (law) from 7 shareholders to 3, they also demanded proof of funds, at least from the 51 percent Thai shareholders. Believe the last I heard was, that within a given time the full capital has to be paid in.

However assumptions only, so if you wish to go on, you better consult a lawyer.

[nithisa78]

Maybe you could ask a lawyer and pay a service fee?

[jimmiejackson]

Yes of course I can and will ask a lawyer but if I'm the only one who's ever paid for terrible and incorrect advice I would be surprised. It's nice to hear from someone who has recently done it just for some backup.

[Muzarella]

This info I got when I register a Limited Partnership with my wife a year ago.

There are 2 types of Thai Limited companies

1) Limited Partnership Company

2) Limited Company

In Limited Partnership capital can be any amount, but the most common is 1 mill some times required to obtain licenses, import/export, etc. The amount declared is the maximum liability, and some limited partnership can be opened declaring 500K or less. Do not need to show or use any capital money to register the company.

The total cost of registration at any DBD local office is not more than 2000THB, and can be done by yourself.

This kind is the one with 51% shares for a Thai and 49% shares or less for a foreigner. One to 3 Thai partners or employees may be necessary to get the work permit for one foreigner, depending of the local Labor Dept. A Thai CPA will be necessary later on to declare annual taxes, and can be part of the partnership if necessary or convenient.

In Limited Company it is necessary to show the declared capital, and is used for major business. It is more costly to register and sometimes need help from an attorney or CPA to do partners contracts, etc.

Check the Thai site for the Department of Business Development / DBD web site for more info. It is in English.

Edited March 1, 2015 by Muzarella

[watcharacters]

Yes of course I can and will ask a lawyer but if I'm the only one who's ever paid for terrible and incorrect advice I would be surprised. It's nice to hear from someone who has recently done it just for some backup.

I'm with you on that but as you certainly know, you can never rely on advice from TV members about something such as this matter.

Visa issues and housing yes but you're going way beyond that.

[jimmiejackson]

Thanks for the info. I think it's best she avoids the limited partnership as the general partner is actually liable to the full extent of any liabilities and not just their share holding which would worry me.

Any other advice about the "paid up" or not part would be good! Thanks.

[khunPer]

Yes of course I can and will ask a lawyer but if I'm the only one who's ever paid for terrible and incorrect advice I would be surprised. It's nice to hear from someone who has recently done it just for some backup.

Normally the first consultation with a lawyer will be free of charge - only if you wish to go on with a registration of a limited company you will be charged; often a fixed fee you can be informed about in advance. At the information consultation you can be advised about, if the full shareholder capital need to be paid in cash, and if proof of funds from Thai shareholders are needed.

A limited partnership may not be the best way, as you may need a Thai partner fully responsible for the company's liability, and with 51% ownership; often recomended if you make a small business with your Thai wife only.

I think you can open a Co. Ltd. with less than 2 million baht shareholder capital, the 2 million is normally used if the company shall need a Work Permit for a foreigner (alien).