If you have a dormant company in Thailand, what do you have to be aware of?

A dormant company is a registered company with no trading activities for a certain period. It is possible to register a limited company then keep it inactive since there is no time limit for keeping a company in dormant status (some refers to it as “shelf company”.) Thus, you may choose to put your company inactive for some time as long as you perform some administrative duties each year such as closing of the accounting books, having them audited by a Thai CPA and filing of the audited financial statements and corporate income tax returns by 150 days from the accounting year-end even when you are not trading. Failure to file the audited financial statements to Department of Business Development, Ministry of Commerce, may result in a criminal penalty up to Baht 50,000 for the company and Baht 50,000 for the Director.

In case your company has been registered in the VAT system and you prefer to put it in dormant status, the company is still responsible to file its monthly VAT return (showing zero output and input taxes). If you are planning to go back and stay overseas, you should assign somebody to assist you in filing this monthly return within the 15th of each month. Failure to submit it on time would have a penalty of THB 500 per return to be paid to the Revenue Department. However, filing NIL monthly VAT return for many months may be the reason for the Revenue Department to visit your company. You may choose to file Por Por 09, VAT registration form to inform the Revenue Department of temporary cease of operation. Usually this is good for a year. The Revenue Department may choose to delete your company from the VAT system if you have ceased your operation for more than one year.

Eventually, if you would like to put your Thai registered company into a dormant status for certain reasons (e.g. you are not ready to trade yet or would like to take a break for some time), we can help make it possible. Rest assured that you can always continue your trading activities later and you would not need to close down your company. And if you decide to close it down, we are the best people you should talk to.

Contact ThaiLawyers for your questions on dormant company in Thailand. We are part of MSNA Group assisting foreigners in doing business in Thailand.