Registering a Company Under the Thailand Board of Investment is an attractive option for foreign business owners. It allows for a maximum of 49% foreign ownership and offers tax incentives like corporate income tax exemptions.
The first step is to find out if your business is eligible for BOI promotion. You can do this by determining which of the 70+ BOI eligible activities your company performs.
Capital Requirements
The Board of Investment is a government agency that provides both fiscal and non-fiscal incentives to companies that invest in Thailand. These benefits include tax exemptions, reduction of import duties on machinery, and permission to bring skilled foreign workers into the country.
To be eligible for a BOI promotion, a company must develop competitiveness and meet certain capital requirements. It must have a value-added of at least 20 percent of its revenues and use modern production processes. Additionally, all companies that receive a BOI promotion are required to make a tax prepayment of half of its estimated annual net profit.
Another requirement is that all BOI-approved projects must have a minimum registered share capital of two million baht. Unlike other types of incorporation, the liability of shareholders is limited to the unpaid amount of their par value of shares. This is also one of the reasons why foreign investors prefer to register a BOI-approved company.
Registration Process
After submitting the application form and other related documents, the company will receive a letter of approval within ten working days. This letter will outline the criteria that will determine whether or not a company gets BOI status and will include details about the privileges and perks that will be available.
Once the company has been approved, it must prepare its business plan and submit it to the Department of Business Development (DBD). The DBD will reserve a name for the company that has been selected by the promoters. The names must be unique and comply with regulations. The registrar has the power to reject names that don’t meet requirements or are already in use.
The BOI offers several tax incentives to companies that have been promoted. These tax incentives vary depending on the type of business and its location. For example, a high-technology company will receive a five-year corporate income tax exemption while an infrastructure company will get an eight-year tax exemption.
Taxes
When a business is promoted by the BOI, it may be granted tax privileges and perks. These include a tax exemption on profits that are generated by the company, exemptions from import duties on raw materials and machinery, and reduced corporate income tax (CIT) rates.
In addition, BOI-promoted companies are allowed to hire more foreign employees than other businesses operating in Thailand. This allows the companies to gain an edge in the global marketplace.
The BOI helps to promote valuable investments in targeted economic sectors by devising investment policies. It also offers various tax and non-tax incentives to overseas firms. Baan Thai can provide you with end-to-end services related to the BOI, including registering your firm, facilitating expat work permits, and achieving compliance. Our bilingual counselors are well-versed in all aspects of the BOI process and can help you navigate the complexities. For more information, contact us today!
Licensing
Once business owners submit their promotion acceptance forms and register a company name with the Department of Business Development, they must register for tax purposes within 60 days and obtain a tax ID number and corporate tax identity card. They must also register for VAT if applicable. They may also need to register for licenses and permits depending on their business activities.
BOI Thailand provides various incentives to foreign businesses that can provide new technology and benefits to the country. Some of these include major tax exemptions, tariff reductions, and foreign ownership approval. These privileges are subject to change and require that companies follow certain limitations and reporting requirements.
Companies must also meet requirements such as keeping books and following accounting procedures, annual general meetings, and yearly audits. They must also report financial information to the Revenue Department. The Revenue Department will closely inspect these companies to ensure that they are using the tax exemptions and rebates only for eligible purposes.
