Frequently Asked Questions - Company Setup

Shareholders liability:

When you talk with people about being promoters and shareholders in your company, one of the common questions they will ask is what their liabilities are.

You will need to explain that one of the main purposes of a "limited company" is that shareholders liability is limited to the unpaid portion of their shares. In other words, if someone has 1 million baht of shares which is all paid up and they have the certificate to show it, then they are not liable for any more. However, if they have 1 million baht of shares but have certificates to show only 700,000 baht are paid up, then they may be liable for up to 300,000 baht.

Share prices:

Each shareholder can hold a minimum of 1 share at a minimum price of 5 baht. Of course, the value per share can be higher than 5 baht if you so decide.

Preference shares:

For purposes of authority and voting, some shares can be "preference shares" which count more in voting for company decisions than their monetary value. For example, a shareholder can hold 51% of the share monetary value, but another shareholder can own 40% of the monetary value yet the preference share value could be 66% in voting. Decide on these numbers from the outset.

Company address:

Your company must have a registered address, which the Ministry of Commerce will mail all correspondence to.

If you are audited, then they will visit this address. You can have branch office addresses, too, if needed.

If you change your address, then you must submit the proper paperwork and possibly move your company registration to a new district office.

Notably, if you are renting a house and wish to tax deduct your rent, then you should change the lease name into the company name, get receipts for rental payments, and pay VAT. Some landlords do not like this because they aren't paying income taxes on their rental income.

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