Starting Company And Workpermit

[Khun Jean]

Hi all,

I am trying to establish a small company for my internet business in the Netherlands.

For me it is very unclear how to go about it.

I dismissed the idea of founding a Ltd because i am not keen on the administrative work that has to be done. I prefer a partnership with my wife.

I know i am safer and bla bla. But I earn money for living and saving and if we buy a house or invest in something big then i will take care of it at that time.

At the thai chamber of commerce they say i have to capitalize at least 2 million baht and have four thai employees and a 60.000 baht income per month before a workpermit can be issued. I am staying here on a non-immigrant type 'o' visa and have my first stamp which permits me a stay of 1 year.

As said i want to set up a small business so 2 million and 4 employees is out of the question.

I have some very good customers in the Netherlands who are very happy if i keep doing work for them. All at a good price. For me it is relatively simple work which i also enjoy doing.

I thought about just doing it at home with my personal computer but i feel that if i want to stay here for long time i might as well do it the proper way. I mean paying tax is not the problem, i will be happy to do that.

I also intend to have about 1 or 2 employees for the graphical work in which i am capable but not very good.

Is this totally impossible?

[Indo-Siam]

If you are married to a Thai, and have a long-term entry permit based on a Class O visa, then you can get a long-term work permit without Thai employees, 2,000,000 baht paid in capital, or the 50,000 baht salary (it's 60,000 baht only for Americans, Canadians, and Japanese).

All those requirements are practiced by Immigration Department, not Labor Ministry. Things at Work Permit Office will go smoothest if you can document a University degree, and also show 2,000,000 baht in REGISTERED (not necessarily paid-in) capital.

My work permit first issued in 2002 still has the page listing the requirement that my company have four Thai employees to keep my work permit valid. But - for more than one year now, the Work Pernit office has not even asked about the number of Thai employees.

It is adviseable to pay yourself enough to result in at least 18,000 baht per year in personal income taxes - that's about 30,000 baht per month. But - if you are married to a Thai, even that is not required.

But - given the directions that Immigration is moving, when you renew your Class O entry permit each year, do it based on having stipulated funds in the bank, and do not base it on employment with work permit - they could make trouble for you if they see that you are not meeting the standards they set for employment-based long-stay visas. This last part is just my opinion, based on trends.

I've decided to keep my company out of the business of registering sole proprietorships and limited partnerships.

Good luck!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[Sunbelt Asia]

The only requirement in your case is being paid a salary of 30,000 Baht per month (tax of 1,500 Baht per month)

You state you understand the disadvantage of a limited partnership over a limited company, so won't go into the danger then. Our company advises forming a limited company but we do handle limited partnerships for those clients who prefer that formation.

The government fee for a limited partnership is 1,000 Baht (up to three partners) and our professional legal fee is 3,900 Baht plus Vat. The work permit is 7,800 Baht for our professional fees and 3,000 Baht for the government fees( one year)

www.sunbeltasia.com

[email protected]

[BlissfullyIgnorant]

The only requirement in your case is being paid a salary of 30,000 Baht per month (tax of 1,500 Baht per month)

You state you understand the disadvantage of a limited partnership over a limited company, so won't go into the danger then. Our company advises forming a limited company but we do handle limited partnerships for those clients who prefer that formation.

The government fee for a limited partnership is 1,000 Baht (up to three partners) and our professional legal fee is 3,900 Baht plus Vat. The work permit is 7,800 Baht for our professional fees and 3,000 Baht for the government fees( one year)

www.sunbeltasia.com

[email protected]

This thread is somewhat similar to my situation..

I have foreign business which I currently manage via the internet. My taxes are paid overseas, and I currently couldn't avoid paying tax in my home country until I have a long-term visa and could prove domicile in another country.

I will soon be marrying my Thai GF of 2.5 years and am looking at ways I can bring my existing business to Thailand. I have an already well established client base, and have no need for any employees, and no need or desire to do any business locally in Thailand.

I also trust my fiance unequivocally, so I don't have any worries about creating business in her name, and/or with bank accounts solely under her control.

If we (she?) were to setup a limited partnership, what are the ramifications regarding:

Am I allowed to be listed as a partner? If so, what rights/responsibilities would I have?

Am I allowed to legally work in the business? If yes, would I require a work permit? If yes, how could I get a work permit without having a company with registered capital?

I haven't been able to get definitive answers to any of my questions - everyone seems to soley recommend/sell you on a 2M baht company. For my business this is simply uneconomical.

There has to be a way - how do all of these small business owning farangs do it?(e.g. bar owners, restauranteurs etc) - I've met many of them and I'm pretty sure that most would simply have been unable to front 2M capital for a company.

[Sunbelt Asia]

Am I allowed to be listed as a partner? If so, what rights/responsibilities would I have?

You have limited liability as long as you don’t interfere in, or otherwise gets involved with the management of the partnership, otherwise you will become jointly, unlimitedly liable for all the obligations of the partnership. Limited partnership must have at least one partner with unlimited liability. For example, if your GF is the Managing Director, then she will be open to unlimited liability. You as a foreigner cannot have control over your investment via voting rights or have the title of Managing Director.

Am I allowed to legally work in the business?

Yes

If yes, would I require a work permit?

Yes

If yes, how could I get a work permit without having a company with registered capital?

You simply apply. Under the current Ministry of Labor work permit regulations you would be able to apply for and receive a work permit as long as the job is not prohibited to foreigners and you pay at least 18,000 baht in personal income tax a year. However having registered capital of 2 million Baht even in a limited partnership will make the job much easier for our Lawyers.

I haven't been able to get definitive answers to any of my questions - everyone seems to soley recommend/sell you on a 2M baht company. For my business this is simply uneconomical.

Did you know this does not have to be paid up in cash? You can have 25% paid up 30 days after the company is formed. The company then can loan a portion of these funds back to the Director with interest. The other 75% can be assets such as acquisition of office equipment, software. The Ministry of Labor is not currently requiring that this is paid up capital. This requirement can be easily reinstated.

There has to be a way - how do all of these small business owning farangs do it?(e.g. bar owners, restauranteurs etc) - I've met many of them and I'm pretty sure that most would simply have been unable to front 2M capital for a company.

See above.

On the less than 2 million Baht perhaps you’re talking a beer bar, but not too many bars or restaurants can be setup for anything lower than 2 million Baht in tourist areas. Six months deposit for the rent alone will run 1.5 million on most single shop houses on Sukhumvit. Some of these guys though own the business but don’t have a work permit. That’s who immigration will be going after and should. Why should the guy who is paying VAT, income taxes have an unfair advantage over the guy who doesn’t report anything?

www.sunbeltasia.com

[BlissfullyIgnorant]

You have limited liability as long as you don’t interfere in, or otherwise gets involved with the management of the partnership, otherwise you will become jointly, unlimitedly liable for all the obligations of the partnership.  Limited partnership must have at least one partner with unlimited liability. For example, if your GF is the Managing Director, then she will be open to unlimited liability. You as a foreigner cannot have control over your investment via voting rights or have the title of Managing Director.

In my case I am the business as it were, so I imagine I would have to take on some type implied managerial role. My spouse's role is that of Office Manager (using the phone to organise everyone over for a BBQ), and Food and Beverage Engineer (preparing coffee and snacks) In this light, are there any negative legal connotations? I'm not concerened about sharing or wearing any liability, just about the legality of my role in the business.

You simply apply. Under the current Ministry of Labor work permit regulations you would be able to apply for and receive a work permit as long as the job is not prohibited to foreigners and you pay at least 18,000 baht in personal income tax a year. However having registered capital of 2 million Baht even in a limited partnership will make the job much easier for our Lawyers.

My spouse owns a house and various parcels of land worth more than 2M baht combined - could any of this be used as capital for the business? Anything to expedite the process or make it easier is of course beneficial. The major point for me is that the whole process of getting legally married, and getting & extending a non-immigrant O visa is going to be costly enough - If I need to front up even more "investment" money it's going to take all that much longer to make it all happen.

On the less than 2 million Baht perhaps you’re talking a beer bar, but not too many bars or restaurants can be setup for anything lower than 2 million Baht in tourist areas.  Six months deposit for the rent alone will run 1.5 million on most single shop houses on Sukhumvit. Some of these guys though own the business but don’t have a work permit. That’s who immigration will be going after and should. Why should the guy who is paying VAT, income taxes have an unfair advantage over the guy who doesn’t report anything?

The businesses I had in mind are based in Chiangmai, where I imagine the rents would be lower than those on Sukumvit of course, but point taken. I agree completely - if you can't do it legally, don't do it at all!

Many thanks for the quality advice, Sunbelt will certainly get my business and my recommendation.

[thohts]

I would like to do something similar because I would like to stay in Thailand for at least a few more years. I am currently on a tourist visa.

I am a US citizen. However, I do not have the capital requirements for most business forms. Is it possible to set up a company with very minimal capital requirements? (I am able to pay the necessary legal fees, of course).

I am wondering if I could establish my business as a sole proprietorship (one Thai legal site mentioned that a foreigner could, but I wonder if this is true).

Another option is a partnership with a Thai national. But I would much prefer working for myself.

How do I do this legally?

[Emi]

Hi there.

I'm a Spanish moving soon to Thailand with a non-inmigrant type "B" visa. I have a Thai g/f with whom I pretend to marry and I wish to stay in Thailand and set up a garment business there. Basically we would design and produce our outlets in Thailand and then we would sell them part in Thailand ( my girlfriend owns some shops in BKK) and part in Spain ( I own some shops in Spain). We also pretend to buy/rent some more shops in Thailand to have some more selling points for our items.

I have several questions. In first place I need to take money to Thailand to start up our business. Can I keep it in a bank account in foreign currency or do I need to change it into baths? I listened you can open a bank account in foreign currency, but you need to be a legal resident for that. If I need to be a legal resident...which are the steps I should follow then?. Should I register a company first and then apply for the residence or the other way around? Can I register a company in Thailand without being a resident? Can I work legally for my own company? How much money do I need to bring into Thailand in order to set up a company?

For these and for many other questions I would appreciate any advice anyone could give me.

Thanks.

[scratt]

"It is adviseable to pay yourself enough to result in at least 18,000 baht per year in personal income taxes - that's about 30,000 baht per month."

This is of great interest to me..

I have just set up a company here and am applying for a Work Visa...

No problems so far, and lickily we have enough assets / cash..

However, My wife and I (both Farrang) don't need 50,000 Baht a month to live!

We own our condo, have a car (and UBC paid up for a year!! Hooray!) and basically need living expenses.. Food etc..

As we all know you don't need 50,000 Baht here to eat.

I would love to be able to pay us around 25,000 - 30,000 Baht per month and pay the appropriate taxes...

Can anyone explain how it is ok to apparently ignore the Immigration rules and pay yourself less.

We are very concerned with staying legally here and paying our fair share, but not having to pay taxes on unwanted / unneeded income.

Thanks, to anyone who can help,

All the best,

scratt

p.s. How do those Quote thingys work anyway!!?!

[shopgurl]

p.s. How do those Quote thingys work anyway!!?!

Press the QUOTE button at the right corner of the message box, and you can quote a poster's message.

[scratt]

p.s. How do those Quote thingys work anyway!!?!

Press the QUOTE button at the right corner of the message box, and you can quote a poster's message.

Cool! Thanks for that! Was trying the QUOTE button in the little block at the top when you write a message...Not getting much joy that way! Thank you!!

Now has anyone got any info on my other question!

All the best,

scratt