Private Limited Company (Co., Ltd.)
บริษัท จำกัด (Borisat Chamkat)
Company formation in Thailand
The Co., Ltd. is best suited for: Foreign entrepreneurs establishing a business in Thailand with Thai partners, Companies applying for Board of Investment (BOI) promotion to obtain 100% foreign ownership, US citizens and businesses leveraging the Thailand–US Treaty of Amity for majority foreign ownership, SMEs serving the Thai domestic market or using Thailand as a regional production base. A Thai Co., Ltd. is subject to corporate income tax at a flat rate of 20% on net profits. Small and medium enterprises (paid-up capital not exceeding THB 5 million and revenue not exceeding THB 30 million) benefit from a reduced progressive rate: exempt on the first THB 300,000, 15% on THB 300,001 to THB 3 million, and 20% above THB 3 million. VAT is levied at 7% (reduced from the statutory 10% rate) on most goods and services. Dividends paid to non-resident shareholders are subject to 10% withholding tax, which may be reduced under a double tax treaty. BOI-promoted companies can receive corporate income tax exemptions for 3–13 years depending on the promoted activity and location. Thailand does not impose capital gains tax as a separate tax — capital gains are included in ordinary income and taxed at the standard corporate rate.
- Foreign entrepreneurs establishing a business in Thailand with Thai partners
- Companies applying for Board of Investment (BOI) promotion to obtain 100% foreign ownership
- US citizens and businesses leveraging the Thailand–US Treaty of Amity for majority foreign ownership
- SMEs serving the Thai domestic market or using Thailand as a regional production base
Key Facts
Step-by-Step Formation Process
Reserve a company name
Submit a name reservation application to the Department of Business Development (DBD). The name must be in Thai and may also include an English translation. The name must not be identical or confusingly similar to an existing registered company. Up to three name choices can be submitted.
Hold a Statutory Meeting
Convene a statutory meeting of all promoters (minimum three) to adopt the company's articles of association, appoint directors and auditors, ratify any contracts entered into by the promoters, and approve the issuance of shares. Notice of the meeting must be sent to all promoters at least seven days in advance.
Register the company with the DBD
File the incorporation application with the Department of Business Development along with the articles of association, minutes of the statutory meeting, list of shareholders, director details, registered office address, and the company seal. At least 25% of each share's par value must be paid up at the time of registration. The registration fee is based on registered capital (THB 5,000 per million, minimum THB 5,000, maximum THB 250,000).
Register for tax and obtain a tax ID
Apply for a corporate tax identification number from the Revenue Department. Register for VAT if annual revenue is expected to exceed THB 1.8 million. The VAT registration must be completed before commencing taxable activities.
Post-incorporation compliance
Register for social security contributions within 30 days of hiring the first employee. Apply for any required business licenses or permits depending on the business activity. If seeking a work permit for a foreign director or employee, apply to the Ministry of Labour — the company must have THB 2 million in registered capital per work permit and employ four Thai nationals per foreign worker.
Required Documents
- Name reservation approval from DBD
- Memorandum of Association signed by at least three promoters
- Articles of Association
- Minutes of the Statutory Meeting
- List of shareholders with nationality and shareholding details
- Passport copies and proof of address for all directors
- Map showing the registered office location
- Company seal
- Proof of registered office (lease agreement or ownership document)
Cost Overview
Tax Treatment
A Thai Co., Ltd. is subject to corporate income tax at a flat rate of 20% on net profits. Small and medium enterprises (paid-up capital not exceeding THB 5 million and revenue not exceeding THB 30 million) benefit from a reduced progressive rate: exempt on the first THB 300,000, 15% on THB 300,001 to THB 3 million, and 20% above THB 3 million. VAT is levied at 7% (reduced from the statutory 10% rate) on most goods and services. Dividends paid to non-resident shareholders are subject to 10% withholding tax, which may be reduced under a double tax treaty. BOI-promoted companies can receive corporate income tax exemptions for 3–13 years depending on the promoted activity and location. Thailand does not impose capital gains tax as a separate tax — capital gains are included in ordinary income and taxed at the standard corporate rate.
Pros & Cons
- Well-established and widely recognized corporate form in Thailand — the standard vehicle for doing business
- Corporate tax rate of 20% is competitive within ASEAN and lower than Japan or South Korea
- Board of Investment (BOI) promoted companies can receive significant incentives including corporate tax exemptions for up to 13 years, 100% foreign ownership, and permission to own land
- Thailand's strategic location in Southeast Asia provides access to ASEAN's 680 million consumers and major regional supply chains
- Low operating costs relative to developed Asian economies — skilled labor, office space, and manufacturing costs are significantly lower
- US citizens and US-majority-owned companies can hold majority or 100% ownership under the Thailand–US Treaty of Amity
- Foreign Business Act restricts foreign majority ownership in most service sectors — foreigners are generally limited to 49% unless an exemption applies (BOI, Treaty of Amity, or Foreign Business License)
- Minimum three shareholders required — sole proprietors cannot form a Co., Ltd. alone
- The 4:1 Thai-to-foreign employee ratio and THB 2 million capital per work permit requirement can be burdensome for small teams
- Thai-language filings and documentation are required for most government interactions
- Using nominee Thai shareholders to circumvent the Foreign Business Act is illegal and can result in severe penalties including imprisonment
- Annual audited financial statements must be filed, and an annual general meeting must be held within four months of the fiscal year end
Other Structures in Thailand
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Get StartedThis content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.