What is a Sole Proprietorship?
This type of business is owned and registered under the name of a single individual, who also acts as the operator. This option is generally not available in most countries, but under the US-Thai Amity Treaty, US citizens can register a Sole Proprietorship Business in Thailand. Additionally, foreigners married to Thai citizens can register a sole proprietorship under their spouse’s name.
Setting up a Sole Proprietorship is straightforward, requiring minimal legal documentation. The sole proprietor assumes personal liability for the business, unlike a limited company. Operating costs are kept low as the proprietor can use their residence instead of renting office space. Taxation is simpler too, with no corporate tax; instead, profits are taxed as personal income.
Starting a Sole Proprietorship
To set up a sole proprietorship in Thailand you will need the following:
- A signed copy of the house registration book of the business address (This can be the sole proprietor’s residence address). If the business address is not the owners then a letter of consent signed by the owner of the building is valid too.
- Passport or ID
- A map of the business address
- Taxpayer number
- VAT certificate
- Application Form
To start, register your company name at the DBD office, which typically takes a few days. Provide at least three names to avoid conflicts with existing registrations, which could delay your application.
Next, upload your documents on the DBD e-registration portal to obtain a Certificate of Incorporation. Initially, there’s no need to register for VAT unless your business exceeds 1.8 million in annual revenue.
Foreigners operating sole proprietorships must also secure a valid visa and work permit.
Ensure your business obtains any required licenses and consult a lawyer to confirm full compliance with regulations.
