THE TOP 5 THINGS INVESTORS NEED TO KNOW ABOUT THAILAND
(1) Foreign ownership restriction
- The Foreign Business Act (FBA) restricts and prohibits a “foreigner” from carrying out certain business activities
- A “foreigner” includes Thai-registered companies where 50% or more of the share capital is held by non-Thai individuals and/or foreign corporations in industries such as retail, wholesale, agencies, advertising, etc.
(2) Board of Investment
- The Board of Investment (BOI) provides investment promotion for business activities like the manufacturing of certain products, services and agricultural goods
- The BOI grants a number of tax and non-tax incentives to promoted companies, one of which is the entitlement to have 100% foreign ownership
BOI-promoted companies may enjoy exemption or reduction of import duties and corporate income taxes for 3 - 8 years.
(4) Currency control
The Bank of Thailand regulates inward and outward of remittances. Generally, the share capital of companies in Thailand shall be remitted within the end of the first fiscal year. Any remittance exceeding USD50,000 is subject to approval from the Bank of Thailand.
(5) On-going compliance
Companies' financial statements are to be audited and its annual return to be submitted within 5 months from the end of the fiscal year.
They must also file their corporate income tax on a half-yearly basis. Companies are also required to register for value-added tax (VAT) for the sale of goods and services. VAT returns are to be filed by the 15th day of each month.
THE IMPORTANCE OF WORKING WITH ADVISORS WHO KNOW THAILAND
- Know the nuts and bolts of the country
- Understand practical issue on the ground and ways to overcome them
- Better manage the budget for the setting up and maintenance of the company
- Provide holistic advice on compliance matters
YOUR IDEAL LAUNCHPAD INTO ASEAN
Singapore is an excellent base for reaching out to the region’s developing markets.
- Businesses in Singapore enjoy tax and other benefits of intra-ASEAN trade. They also enjoy free trade and double tax agreement benefits that Singapore has with neighbouring countries such as China, India, Australia, Japan and South Korea
- Singapore is the de facto financial capital of ASEAN’s treasury function
- It enjoys a low corporate income tax rate (currently at 17%), has no tax payable on dividends earned externally from its borders (subject to meeting conditions) and offers tax incentives/financial assistance to small-medium enterprises wishing to establish operations overseas
- There is no capital gain tax. If a Singapore holding company were to sell its shares in the subsidiary and makes a profit, there is no capital gain tax at the Singapore holding company level
- Strong reputation as a leading global financial hub