Thai wife wants to export goods - how to set it up?

[jimmiejackson]

Hi all,

Just looking for some advice. This is for my Thai wife but obviously I need to make sure it's done right or I'll end up on the hook one way or another!

She has some friends in Europe that want to import some goods that are made here. They will send my wife the money, my wife will arrange to have the items manufactured by a factory, check they are correct, package and ship them to Europe using an express courier (DHL for example).

Thing is, I don't want to go through the whole rigmarole of her setting up a Thai LTD company (at least until I know it's a big earner) and don't want to get involved mixing my company with her business.

What are her options? I don't really understand what the "Amphur registered" business is. Would this allow a "Company" bank account? How about getting an account with DHL, Fedex etc, and what is her liability in this scenario?

A little confused.

Any advice would be appreciated.

[timendres]

I am not an expert in this area.

However, I do not see why you would have to do anything extraordinary in this case.

There is nothing wrong with your wife "purchasing" goods made in Thailand and sending them to another country. Unless Thailand has a law stating that exports for the purpose of profit require that a company be formed. I know of no such requirement, but again I am not an expert in this area.

You must be sure that the import duties on the receiving end are properly paid. You need to check if there are any export restrictions or export duties required on the Thailand side of the transaction.

You need to make sure that if she actually make a profit on the transaction that she reports this as income on her tax return.

Simple as that.

Now, if you get serious about things, you will want to setup all of those other structures (company, accounts, etc.), but I do not see why this would be necessary at the very beginning. The only concern would be product liability. For instance, if she is shipping out skin cream, and that cream is burning off peoples' skin or giving them cancer, then she may need some sort of protection. But for simple products, this is not a big concern.

tim

[nithisa78]

JJ, Get a lawyer. I've a friend is a good one. In BKK from UK.

Good luck. Chok Dee

[jimmiejackson]

I am not an expert in this area.

However, I do not see why you would have to do anything extraordinary in this case.

There is nothing wrong with your wife "purchasing" goods made in Thailand and sending them to another country. Unless Thailand has a law stating that exports for the purpose of profit require that a company be formed. I know of no such requirement, but again I am not an expert in this area.

You must be sure that the import duties on the receiving end are properly paid. You need to check if there are any export restrictions or export duties required on the Thailand side of the transaction.

You need to make sure that if she actually make a profit on the transaction that she reports this as income on her tax return.

Simple as that.

Now, if you get serious about things, you will want to setup all of those other structures (company, accounts, etc.), but I do not see why this would be necessary at the very beginning. The only concern would be product liability. For instance, if she is shipping out skin cream, and that cream is burning off peoples' skin or giving them cancer, then she may need some sort of protection. But for simple products, this is not a big concern.

tim

That was my thinking. The product isn't something that would carry any serious liability so I'm not worried about that.

I'm wondering what the difference between her just doing it "off the books" (and obviously declaring her profit 100% honestly just like everyone else...) and having the Amphur issued certificate (I'm really not sure what it is, although I see the certificate in plenty of small businesses) is.

I wonder if it has any tax, banking or liability benefits of any kind.

As for lawyers; I have lawyers and accountants coming out of my ears for my business. I sincerely doubt any of them is going to suggest a method which is essentially free and doesn't require lawyers or accountants. Just like when the advert says "9 out of 10 Dentists recommend Colgate" - you definitely want to stay well clear of Colgate.

Edited June 15, 2015 by jimmiejackson

[dundas]

I'm also exploring this. My understanding (yet to be confirmed) is that if a Thai sets up an export company there are tax and other benefits to be had. The cost of setting up can vary between a couple of hundred dollars and quite a few thousand dollars depending which law firm does the work. All to be confirmed when we talk to the supposedly cheap law firm in the next few weeks.

[jimmiejackson]

I'm also exploring this. My understanding (yet to be confirmed) is that if a Thai sets up an export company there are tax and other benefits to be had. The cost of setting up can vary between a couple of hundred dollars and quite a few thousand dollars depending which law firm does the work. All to be confirmed when we talk to the supposedly cheap law firm in the next few weeks.

I have a Thai Limited export only Company. The cost to set up isn't so much (paid less than 100,000 Baht including work permits and various other things I can't remember now) but the running costs to keep everything straight are crazy - notarized contracts, accountant bills, large number of (honestly unnecessary Thai staff) to support work permits, customs inspection on every outgoing shipment etc etc etc. Never ends.

This is why I don't want to mix in my wife's business with mine. What I have is set up and manageable but I can't just decide to export a product casually to someone - I have to jump through a thousand hoops to keep it all on the up and up.

Better she does things separately for her own business but I want to make sure she's keeping it straight as far as necessary.

[thailandforumaddict]

Your wife is a personal shopper ?

[jimmiejackson]

Your wife is a personal shopper ?

Nope.

She has friends who live in Europe that want to import a particular product that can be manufactured here.

The reason they want her involved is because otherwise they would send the order to a small Thai factory and hope that that product came out:

On time

On cost

Correctly as per the specifications provided

Shipped correctly labelled and at cost

etc

If they send the orders through her and pay a % markup she will make sure all of the above is done correctly as far as possible.

[chilli42]

Do not set up a company or partnership of any kind. On the scale of business you are contemplating it simply complicates and adds cost. Do not involve a lawyer they are the source of most grief and tremendous bad business advice. Simply do the business from home. Secure agreements with the people being supplied as to prices, who pays for shipping, customs clearance etc. Also shop around for freight rates. DHL and their kind are fast but expensive. If you can do a 7-10 day delivery lots of much lower cost options open up. Finally, only ship whe ypu have been paid ... even if it's your grandmum on the other end ... place no trust this is a business transaction.

[jimmiejackson]

Do not set up a company or partnership of any kind. On the scale of business you are contemplating it simply complicates and adds cost. Do not involve a lawyer they are the source of most grief and tremendous bad business advice. Simply do the business from home. Secure agreements with the people being supplied as to prices, who pays for shipping, customs clearance etc. Also shop around for freight rates. DHL and their kind are fast but expensive. If you can do a 7-10 day delivery lots of much lower cost options open up. Finally, only ship whe ypu have been paid ... even if it's your grandmum on the other end ... place no trust this is a business transaction.

I agree and she will certainly be demanding payment up front (I'll be making sure of that!)

She will need an office and a couple of staff. Nothing fancy, just a small operation. Not possible from home though.

Still trying to work out if anyone knows what this Amphur registered small business thing is and whether there's any point.

[neeray]

I am setting up to do similar. My first shipment will be sent on a personal basis as samples. It will be declared as commercial goods at point of entry. A company will follow later. All will be done on the up and up.

[Maestro]

I don't know about business registration at the District Office (amphoe)

As a Thai national your wife can do the buying and selling in her own name, as as a natural person, but from what you wrote I believe she wants do it in a business name, with a business account with a bank, courier service, etc.

The simplest form of a juristic person is the Sole Proprietorship. A Google search in English will give you links to information in English, eg http://integrity-legal.com/legal-blog/thailand-business/thai-limited-company-registration-and-thai-sole-proprietorships/ and http://www.thaivisa.com/forum/topic/585952-need-advice-on-sole-proprietorship-for-thai-national/. I suggest that your wife do a web search with the Thai term for Sole Proprietorship for free general information, then for more free advice contact the Business Development Department of the Ministry of Interior and the Revenue Department of the Ministry of Finance, both of which are known to be very helpful.

[jimmiejackson]

Ah, very useful. You're correct, that's what I was looking for the correct term for.

Now I have that I will be able to do some further research.

Thanks!

[ableguy]

I have shipped container loads of products from here to UK and USA, I know everything you need to know but not prepared to spend half an hour giving you advice. Not knowing if it will be the advice you want, you can pm me and I will give you my phone number, I do not want any money from you or any other bullshit, but I am willing to help you because I learned the hard way.

Ps I was shipping goods for several years I am now retired for six years and no intention to ever work again..

[4u2mad]

Don't know how big the product is or weight, but check EMS world. Small price for the service. I did this and turned a profit on export of goods to Europe. Pm me if ur interested - I don't want ur money

[MauiSteveBKK]

I Am Importing From Thailand To Maui, Hawaii.

+ I place an order. Pay with PayPal. Easy.

+ They ship to me via DHL.

+ It arrives within 5-7 days.

+ I get "Import Tax Bill USA" from DHL.

++++***** I have VERY Interested In What All Of You Are Selling !

We are importing dresses and selling on Amazon and EBay.

You can see my simple, evolving web site at: Fashions of Hawaii fashionsofhawaii.com

Please ... let me know if you have products you might want to send to me in the USA.

Many thanks,

Steve

[1FinickyOne]

Slightly off subject, but what your wife will need to establish with her customers is who is responsible if/when there are screw-ups.

I understand that that is her job, to prevent the miscommunications but there can also be issues of misunderstandings between her and the buyers. Too often in starting businesses, people assume all will go 100% correctly… that has not been my experience. I have had enough exp that even in the same language, with people of my hometown, there can be a matter of being on a different wave-length...

[Dogmatix]

I don't what registration you need to do with Amphur if the business is not selling alcohol or tobacco etc. No need to register in advance with the Revenue Dept unless you have to register for VAT. She can just do a PND 90 personal tax return at the year end declaring income from a personal business but, if it is very small, she can just consider it a favour for a friend overseas and not bother to declare.

[p_brownstone]

One possible problem would be with Thai V.A.T., currently at 7%.

If you are buying from a Thai Factory they will add that to the Cost of whatever you buy; if you operate without Registering a Company you cannot claim that back from the Revenue Department when you sell on - so that takes away some of your potential profit.

Patrick

Edited June 16, 2015 by p_brownstone

[mike324]

Easiest may be to get a freight forwarding company to do it for you including all of the paper work. Some would require you to have a register company, some can work around it for you.

I don't know how big your item is, if its small perhaps EMS will be fine too.

DHL/UPS/FedEx will probably be too expensive as a shipping option.

[mike324]

Easiest may be to get a freight forwarding company to do it for you including all of the paper work. Some would require you to have a register company, some can work around it for you.

I don't know how big your item is, if its small perhaps EMS will be fine too.

DHL/UPS/FedEx will probably be too expensive as a shipping option.

[ericjt]

Take a look at MauiSteveBKK's post. He's spot on. Just follow his 4 step list and start doing it. Solve any problems as they come up. Don't go looking for them in advance. If you do, the more you look, the more you'll find. Most times it's better to say "Sorry" than "May I?".

Just let her buy the goods and ship them (assuming she's already been paid.) The shippers will tell her what she needs to do. Follow their directions, fill out the forms and send the goods. Make sure there's enough profit built in to make everything worthwhile, of course. And that's about it. At least at the start.

As the business grows, if/when any problems arise, deal with them. But don't go looking for them. And you don't need a sole proprietorship and/or business bank account in a business name to ship a few parcels to Europe. Let your wife handle payments and receipts with her own personal bank account. Worry about setting up business structures and business bank accounts later. More structures mean more paperwork and more taxes. Keep it simple!

Hope this helps, and good luck!

P.S. I'm a lawyer.