Thai Company vs Foreign Company (BOI): Which Offers Easier Work Permit Access?

What You’ll Learn

In this article, we’ll delve into the key differences between establishing a Thai company and a Foreign Company (BOI) in Thailand, with a particular focus on work permit access. By the end, you’ll have a clear understanding of which structure best aligns with your business goals.

Quick Comparison Table

Feature	Thai Company	Foreign Company (BOI)
Foreign Ownership	Up to 49% foreign ownership	Up to 100% foreign ownership
Visa and Work Permit Processing	Standard processing through immigration and labor offices	Expedited processing via the One Stop Service Center
Tax Incentives	Standard corporate income tax rate of 20%	Potential corporate income tax exemptions up to 13 years
Employment Regulations	Subject to 4:1 Thai-to-foreign employee ratio	Exempt from Thai-to-foreign employee ratio requirements
Land Ownership	Generally restricted for foreign ownership	Permission to own land for business operations in certain cases
Regulatory Compliance	Standard reporting and compliance requirements	Additional reporting and compliance obligations set by the BOI

Overview of Thai Company

A Thai company is a business entity established under Thai law, typically requiring a majority Thai ownership. This structure is suitable for entrepreneurs seeking full control over their business without the need for foreign investment.

Pros

– Full control over business operations
– No need for foreign investment
– Suitable for industries not eligible for BOI promotion

Cons

– Limited to 49% foreign ownership
– Subject to 4:1 Thai-to-foreign employee ratio
– Standard corporate income tax rate of 20%

Overview of Foreign Company (BOI)

A Foreign Company (BOI) refers to a business entity that has been granted promotional privileges by Thailand’s Board of Investment (BOI). This structure is ideal for foreign investors aiming for 100% ownership, tax incentives, and streamlined processes for hiring foreign staff in eligible industries.

Pros

– Up to 100% foreign ownership
– Exempt from Thai-to-foreign employee ratio requirements
– Potential corporate income tax exemptions up to 13 years
– Permission to own land for business operations in certain cases

Cons

– Subject to additional reporting and compliance obligations set by the BOI
– Limited to industries eligible for BOI promotion

Side-by-Side Breakdown

Foreign Ownership and Capital Requirements

– **Thai Company**: Limited to 49% foreign ownership, requiring a majority Thai shareholder.

– **Foreign Company (BOI)**: Allows up to 100% foreign ownership, enabling full control for foreign investors.

Visa and Work Permit Processes

– **Thai Company**: Standard processing through immigration and labor offices, which can be time-consuming.

– **Foreign Company (BOI)**: Expedited processing via the One Stop Service Center, significantly reducing processing times.

Tax Incentives and Exemptions

– **Thai Company**: Subject to the standard corporate income tax rate of 20%.

– **Foreign Company (BOI)**: Potential corporate income tax exemptions up to 13 years, depending on the nature of the business and location. ([taxsummaries.pwc.com](https://taxsummaries.pwc.com/thailand/corporate/tax-credits-and-incentives?utm_source=openai))

Employment Regulations and Staffing Flexibility

– **Thai Company**: Required to maintain a 4:1 Thai-to-foreign employee ratio, limiting the number of foreign staff.

– **Foreign Company (BOI)**: Exempt from the Thai-to-foreign employee ratio requirements, allowing greater flexibility in hiring foreign staff. ([pslawbusiness.com](https://www.pslawbusiness.com/visa-and-immigration/visa-and-work-permit-under-boi?utm_source=openai))

Land Ownership and Property Rights

– **Thai Company**: Generally restricted from owning land, with few exceptions.

– **Foreign Company (BOI)**: May be permitted to own land for business operations in certain cases, providing more stability and security. ([konradlegal.com](https://www.konradlegal.com/2022/12/10/boi-thailand-promotion-why-is-it-mandatory-for-foreign-investors/?utm_source=openai))

Regulatory Compliance and Reporting Obligations

– **Thai Company**: Subject to standard reporting and compliance requirements under Thai law.

– **Foreign Company (BOI)**: Subject to additional reporting and compliance obligations set by the BOI, which can be more stringent. ([tmathaigroup.com](https://www.tmathaigroup.com/blogeng/index.php/post/36.html?utm_source=openai))

Which One Should You Choose?

Your choice between a Thai company and a Foreign Company (BOI) should align with your business objectives and operational needs.

– **Thai Company**: Ideal for entrepreneurs seeking full control over their business without the need for foreign investment, and those operating in industries not eligible for BOI promotion.

– **Foreign Company (BOI)**: Best suited for foreign investors aiming for 100% ownership, tax incentives, and streamlined processes for hiring foreign staff in eligible industries.

Thai Company vs Foreign Company (BOI): The Final Verdict

| Category | Thai Company | Foreign Company (BOI) |
|———————————-|————————————–|—————————————|
| Best for Beginners | Entrepreneurs seeking full control | Foreign investors aiming for 100% ownership |
| Best for Power Users | N/A | Investors seeking tax incentives and staffing flexibility |
| Best Value | Lower setup complexity | Higher benefits for eligible industries |

Findings and Recap

In summary, both Thai companies and Foreign Company (BOI) structures offer distinct advantages. Your decision should be guided by your specific business needs, industry eligibility, and long-term objectives.

Related reading: Understanding the Benefits of Setting Up a BOI-Approved Company in Thailand

AI Image Prompt: A split-screen image showing a Thai company office on one side and a Foreign Company (BOI) office on the other, highlighting the differences in work permit access and business operations.

([taxsummaries.pwc.com](https://taxsummaries.pwc.com/thailand/corporate/tax-credits-and-incentives?utm_source=openai), [pslawbusiness.com](https://www.pslawbusiness.com/visa-and-immigration/visa-and-work-permit-under-boi?utm_source=openai), [konradlegal.com](https://www.konradlegal.com/2022/12/10/boi-thailand-promotion-why-is-it-mandatory-for-foreign-investors/?utm_source=openai))

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Frequently Asked Questions

What is the main difference between a Thai Company and a Foreign Company (BOI)?

The primary distinction lies in ownership and regulatory benefits. A Thai Company typically requires at least 51% Thai ownership, whereas a Foreign Company (BOI) can achieve up to 100% foreign ownership, subject to Board of Investment (BOI) approval. Additionally, BOI-promoted companies enjoy various incentives, including tax exemptions and relaxed foreign employee quotas. ([belaws.com](https://belaws.com/thailand/incorporation/boi-company-in-thailand/?utm_source=openai))

What are the tax benefits of establishing a Foreign Company (BOI) in Thailand?

BOI-approved companies can receive corporate income tax exemptions for up to 8 years, depending on the nature and location of the project. This significantly reduces operational costs and enhances profitability. ([siamese-legal.com](https://siamese-legal.com/understanding-the-benefits-of-setting-up-a-boi-approved-company-in-thailand/?utm_source=openai))

Can a Foreign Company (BOI) own land in Thailand?

Yes, BOI-promoted companies are permitted to own land for business operations, which is a notable advantage over standard Thai companies that face restrictions on land ownership. ([siamese-legal.com](https://siamese-legal.com/understanding-the-benefits-of-setting-up-a-boi-approved-company-in-thailand/?utm_source=openai))

Are there any restrictions on hiring foreign employees in a Foreign Company (BOI)?

BOI companies are exempt from the standard 4:1 Thai-to-foreign employee ratio, allowing for greater flexibility in hiring foreign skilled workers without stringent quotas. ([gentlelawibl.com](https://www.gentlelawibl.com/post/what-is-a-boi-company-in-thailand-and-should-you-register-as-one?utm_source=openai))

What is the minimum capital requirement for a Foreign Company (BOI) in Thailand?

The minimum capital requirement varies depending on the industry and the specific BOI incentives. Generally, it ranges from 1 million THB per project or 25% of projected expenses, whichever is higher for technology companies, to 10+ million THB for large manufacturing projects. ([emerhub.com](https://emerhub.com/thailand/boi-company-in-thailand/?utm_source=openai))

How long does the BOI application process take?

The BOI application process typically takes 45-90 days from submission to approval, depending on the complexity of your project and completeness of documentation. ([emerhub.com](https://emerhub.com/thailand/boi-company-in-thailand/?utm_source=openai))

What are the key benefits of establishing a Foreign Company (BOI) in Thailand?

Establishing a BOI-promoted company in Thailand offers several advantages, including 100% foreign ownership, tax exemptions, land ownership rights, and streamlined processes for hiring foreign employees. These benefits make it an attractive option for foreign investors seeking to establish a presence in Thailand. ([siamese-legal.com](https://siamese-legal.com/understanding-the-benefits-of-setting-up-a-boi-approved-company-in-thailand/?utm_source=openai))

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