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Business Permits & Incorporation for Foreigners in Phuket

Good to know

Good to Know

  • Most small foreign-run businesses you'll see in Phuket (restaurants, dive shops, agencies) use the 51% Thai / 49% foreign shareholding structure rather than going through a Foreign Business License — it's faster and cheaper, but it only holds up legally if the Thai shareholders are genuine investors, not paid nominees, since nominee arrangements are illegal and can lead to forced company dissolution.
  • A virtual office is generally acceptable for the initial DBD registration, but if you plan to register for VAT or apply for an FBL, you'll need a physical, inspectable commercial address.
  • If you're a US citizen, ask a Thai corporate lawyer specifically about the US-Thailand Treaty of Amity — it's a narrower, nationality-specific alternative to BOI or FBL for majority ownership.
  • Budget well beyond the bare government fees: translation/certification of foreign documents, mandatory monthly bookkeeping, and an annual audit are recurring costs that catch many new founders off guard.
  • If you're not a US citizen, plan on incorporating a Thai Private Limited Company rather than trying to freelance as a sole proprietor — genuine sole-proprietorship registration for foreigners is essentially limited to US citizens under the Treaty of Amity or long-term residents registering under a Thai spouse's name.
  • A company gives liability protection and work-permit eligibility but comes with real ongoing costs: monthly bookkeeping, a mandatory annual audit, and multiple tax filings — budget for an accountant/bookkeeper from day one rather than trying to DIY Thai corporate compliance.
  • The current 7% VAT rate is a temporary reduction (currently extended through 30 September 2026) from the statutory 10% rate — don't assume 7% is permanent when modeling long-term margins.
  • BOI promotion is the main legal path to 100% foreign ownership for most non-US nomads/entrepreneurs, but it's realistically only available to businesses with real substance (e.g. an actual software/export services operation), not a one-person consulting setup.
  • Thailand has tightened enforcement against foreigners using Thai nominee shareholders to fake the 51% Thai-ownership requirement — structure ownership properly rather than relying on a nominee arrangement.

Filing Obligations

Recordkeeping
Annual financial statements generally must be audited by a licensed Thai CPA and filed with the Department of Business Development (DBD) and the Revenue Department; documentation should be retained for several years to support any audit.
Late Filing Penalties
Late filing carries fixed fines (roughly THB 1,000–2,000) plus a monthly surcharge of 1.5% on any underpaid tax.

Annual Return

Form
PND 50 (CIT 50)
Deadline
Within 150 days of the close of the company's accounting period (accounting period is normally 12 months)

Mid Year Prepayment

Form
PND 51 (CIT 51)
Deadline
Filed and paid no later than 2 months after the end of the first 6 months of the accounting period, based on an estimate of the full-year net profit
Note
This mid-year prepayment is credited against the final annual liability.

Corporate Income Tax

Standard Rate Note
Thailand's standard corporate income tax (CIT) rate applies to Thai-incorporated companies (including foreign-owned subsidiaries) and to foreign companies with a permanent establishment (PE) in Thailand, taxed on net profit from Thai business activity.
Standard Rate Percent
20
Worldwide Vs Thai Sourced
Companies incorporated in Thailand are taxed on worldwide income; a foreign company not carrying on business in Thailand (no PE) instead faces a final withholding tax on Thai-sourced payments such as interest, dividends, royalties, rent, and service fees, generally 15% (10% for dividends), subject to reduction under an applicable tax treaty.

SME Progressive Schedule

Applies To
Companies with paid-up capital under THB 5 million and gross revenue under THB 30 million per accounting year
Note
Most foreign-invested Phuket companies (e.g. above the SME capital/revenue thresholds) fall under the flat 20% regime rather than this SME schedule.

Bracket 1

Rate Percent
0
Profit Range Local
0 – 300,000 THB net profit

Bracket 2

Rate Percent
15
Profit Range Local
300,001 – 3,000,000 THB net profit

Bracket 3

Rate Percent
20
Profit Range Local
above 3,000,000 THB net profit

Structure Options For Foreigners

Boi Promoted Company

What It Is
A Board of Investment (BOI)-promoted company can secure up to 100% foreign ownership in qualifying sectors (e.g. software/IT services, export services, certain tech and R&D activities), bypassing the standard Thai-majority requirement.
Tax Incentive
Qualifying BOI-promoted activities can receive a corporate income tax exemption (tax holiday) of roughly three to eight years, depending on the promoted category.
Eligibility Note
BOI promotion is aimed at businesses with genuine economic substance and investment commitment; a solo freelancer, small café, retail shop, or basic property-management company generally will not qualify.

Private Limited Company

Structure Name
Thai Private Limited Company (บริษัท จำกัด / Borisat Chamkad)
Ownership Rules
Under the Foreign Business Act, a standard company needs a minimum of 51% Thai shareholding for most restricted activities. 100% foreign ownership is possible only via Board of Investment (BOI) promotion in qualifying sectors, a Foreign Business License, or (for US citizens) the Treaty of Amity.
Minimum Shareholders
As of the 2023 reform, a minimum of 2 shareholders is required (previously 3).
Why Foreigners Use It
This is the standard, and for most non-US foreign entrepreneurs the only realistic, route to legally own and operate a business, hold liability protection, qualify for a work permit, and be taken seriously by Thai banks and landlords.
Typical Registered Capital
THB 1,000,000 is a common general-purpose figure; THB 2,000,000 in registered capital is generally required to support each foreign work permit issued to the company.

Compliance Obligations

  • Monthly bookkeeping
  • Monthly VAT and withholding tax filings where applicable
  • Mandatory annual CPA-certified audit
  • Annual financial statements filed with the DBD and Revenue Department
  • Corporate tax returns (PND 50 annual, PND 51 mid-year prepayment)
  • Annual General Meeting of shareholders
  • Social security contributions for any employees

Compliance Cost Estimate

Basis
Bookkeeping, mandatory audit, and filing fees; costs scale with transaction volume and whether an accounting firm is retained.
Currency Local
THB
Amount USD Range
roughly 2,400–6,000+ USD per year
Amount Local Range
80,000–200,000+ THB per year

Freelancer Sole Proprietor

Legal Availability
In practice, foreigners generally cannot register a sole proprietorship (รายบุคคล) in their own name in Thailand. Registration is normally restricted to Thai nationals, with a narrow exception for US citizens operating under the US–Thailand Treaty of Amity, or for long-term foreign residents who register the business under a Thai spouse's name.
Practical Implication
Most non-US foreign freelancers/consultants in Phuket cannot legally hold a sole proprietorship themselves, so the private limited company is the de facto standard structure even for solo operators who want a legal, work-permit-eligible setup.
If Eligible Tax Treatment
Where a sole proprietorship is permitted (Amity Treaty US citizens, or Thai-spouse registration), business income is taxed on the individual's personal income tax return rather than under separate corporate tax rules, and no statutory audit or published financial statements are required.

Compliance Cost Estimate

Basis
Annual personal tax return plus monthly VAT/withholding filings if applicable; no mandatory audit.
Currency Local
THB
Amount USD Range
150–900 USD per year
Amount Local Range
5,000–30,000 THB per year

Typical Costs Excluding Registered Capital

Realistic All In First Year Thai Majority No Foreign Workers
THB 157,500
Realistic All In First Year Foreign Majority One Work Permit Excluding Capital
THB 348,000
Note
Figures are for standard (non-BOI) private limited companies; BOI-promoted setups have different, generally higher advisory costs offset by tax incentives.

Legal Professional Setup Fees

Low
THB 30,000
High
THB 60,000

Government Registration Fees Only

Low
THB 5,000
High
THB 20,000

Foreign Business License Government Fee If Needed

Low
THB 40,000
High
THB 500,000

Pathways To Majority Or 100pct Foreign Ownership

  • Foreign Business License (FBL)
    Processing Time
    The application process typically takes 3 to 6 months, with the Foreign Business Committee taking up to 60 days just to review and decide on an application.
    Description
    For businesses under List 2 or List 3 of the FBA, a foreign investor may apply to the Director-General of the DBD (decided by the Foreign Business Committee/Cabinet) for a license to exceed the 49% cap; approval is discretionary and assessed on economic benefit to Thailand (jobs, technology transfer, etc.).
  • Board of Investment (BOI) Promotion
    Description
    The Thailand Board of Investment offers incentives, including permission for 100% foreign ownership, for businesses in specific promoted categories, and a BOI-promoted company is not restricted under the FBA.
  • US-Thailand Treaty of Amity
    Description
    A long-standing bilateral treaty exemption that can allow qualifying American citizens/companies to hold majority Thai company shares outside FBA restrictions; this route is nationality-specific to US applicants.

VAT

Reduced Rate Status
The 7% reduced rate is a temporary concession (extended via Royal Decree) currently running through 30 September 2026; it is not guaranteed to be permanent and could revert to the 10% statutory rate if not renewed again.
Current Reduced Rate Percent
7
Standard Statutory Rate Percent
10
Registration Threshold
THB 1,800,000

Any business (company or individual/freelancer) with annual turnover above this threshold must register for VAT (Form VAT 01) and charge/remit 7% VAT.

Double Tax Treaties

Thailand has signed double tax agreements (DTAs) with 61 countries, which can reduce withholding tax rates and prevent double taxation on cross-border income — worth checking against your home country before structuring international invoicing.

Other Relevant Taxes

Other Relevant Taxes

  • Withholding tax (WHT) applies on many domestic payments (services, rent, professional fees) and must be deducted at source by the paying party and remitted to the Revenue Department.
  • Specific Business Tax (SBT) applies instead of VAT to certain exempt sectors (e.g. finance, real estate sales) at rates of roughly 0.1%–3% of gross receipts, plus an additional 10% local tax on top of the SBT amount.
  • A global minimum top-up tax of 15% now applies to large multinational enterprise groups under Thailand's 2025 Top-up Tax framework — not relevant to small nomad-run businesses.

Timeline

Work Permit After Registration
Approximately 4-8 weeks to receive a work permit after company registration; BOI-promoted businesses may see a faster process.
Foreign Business License If Required
An additional 3 to 6 months on top of standard registration, since the Foreign Business Committee can take up to 60 days just to review the application.
Name Reservation To Registered Company
Roughly 3–4 weeks in practice, covering name reservation, document preparation and bank account activation, even though DBD registration itself is completed in 1 to 3 days once documents are signed.

Local Partner Mandate

There is no legal requirement to have a Thai co-founder if a foreigner uses the FBL, BOI, or Treaty of Amity routes — but the vast majority of small foreign-run businesses in Phuket instead choose the Thai-majority (51% Thai / 49% foreign) shareholding structure, since it avoids the FBL application entirely; Thai shareholders in these joint structures are now required to show evidence of financing to prove they are not acting as nominees.

Foreign Ownership Rule

Default Cap
A company is legally classed as "foreign" once non-Thai shareholders hold 50% or more of shares.
Nominee Warning
Some foreigners attempt to circumvent ownership restrictions by using Thai nominees who hold shares but lack real economic interest, and this practice is illegal under Thai law and risks criminal prosecution plus automatic company dissolution if discovered.
Standard Structure
The most common workaround structure is a Thai Limited Company where at least 51% of the shares are held by Thai nationals, which then falls outside the FBA's foreign-business restrictions.

Core Incorporation Steps

Core Incorporation Steps

  • 1. Reserve the company name online via the DBD system (free).
  • 2. Convene the statutory promoters' meeting; Thai law requires at least three shareholders/promoters at incorporation, each holding at least one share.
  • 3. File the Memorandum of Association (MOA) with the DBD.
  • 4. Hold the statutory meeting to adopt Articles of Association, appoint directors/auditor, and approve share allotment (at least 25% of share value must be paid up at this stage).
  • 5. Register the company with the DBD (legal registration itself is completed in 1 to 3 days once documents are signed, though the full process — name reservation, document prep, and bank account activation — usually takes 3 to 4 weeks in total).
  • 6. Register for a Tax ID with the Revenue Department, and for VAT if annual turnover is expected to exceed 1.8 million THB.
  • 7. Open a corporate bank account (requires company certificate, tax ID, and passport; smoother with a Thai director involved).
  • 8. If foreign-majority owned and operating in a restricted List 2/3 activity, separately apply for the Foreign Business License before starting operations.
  • 9. If sponsoring foreign staff, apply for work permits and non-immigrant B visas once registered capital and Thai-staff ratios are in place (Thai law generally requires four Thai employees per foreign work-permit holder, unless BOI-promoted).

Official Government Link

https://www.dbd.go.th/

Governing Law And Regulator

Thailand's Foreign Business Act B.E. 2542 (1999) governs foreign participation in Thai companies, administered nationally by the Department of Business Development (DBD) under the Ministry of Commerce — there is no separate Phuket registry; Phuket-based companies register through the same national DBD system (in person at the Phuket DBD provincial office or online).

Minimum Capital Requirements

Thai Majority Company No Foreign Workers
Can be registered with very low nominal capital; government fee stays fixed regardless.
Foreign Majority Company Unrestricted Activity
Minimum registered capital of 2,000,000 THB, fully paid up, per foreign work permit.
Thai Majority Company Sponsoring A Work Permit
Registered capital must generally be at least 2,000,000 THB per foreign work permit (or 1,000,000 THB if the foreign employee is married to a Thai national), fully paid up.
Foreign Majority Company Restricted Activity Needing FBL
Minimum registered capital of 3,000,000 THB, or 25% of estimated three-year operating expenses, whichever is higher.
AI-generated estimateData refreshed July 2026

Sources cited for this category

These are the sources cited in this business permits & incorporation for foreigners research for this city. Individual figures may not each trace to one of them.

  1. 1.dbd.go.th

More About Phuket

Data last updated July 2026 · Verify anything important.