Employee in wife's company

[bamboozled]

...This has been asked a million times and I apologize for repeating it but the goalposts seem to be constantly in motion and to boot, requirements differ for each situation. Thus please bear with me. I am a US citizen, married to a Thai citizen, on a Non-O visa, living in Chiang Mai. My wife and I would like to start a company and sell things online, shipping 100% out of country. I would like a work permit to design some of the items as I have design skills and presumably know the tastes and desires of the foreign customers (just as a Thai would better know Thai style) and perhaps as manager as that has been stated as something a foreigner can do legally. We plan on going to the labor office to ask directly from the horse but thought I would ask here, first. I have read about 1,000,000 registered capital and X number of employees, minimum salaries, requisite accounting and tax paying, etc... All a bit murky. Can anyone clear the waters a bit? Some posts make it seem easy and some posts make it seem like rocket science.

Let me add, for what it's worth, that years ago I had a registered Thai company LTD with two Thai partners. I did not have a work permit as I didn't need one and in fact the company never made any money (it's a long story!). But I did pay an accountant/lawyer a lot of money for doing nothing. After years of dormancy but still paying some accounting fees, I went about closing it. The accountant/lawyer (who I never really trusted) wanted something like 40,000 baht to close it saying I had to do this and that, etc... In the end, we went to the Labor Dept. and closed it ourselves for 120 baht, if I remember correctly. My point is, there are folks out there who will take advantage of your ignorance....duh! I don't want to hire any of these folks.

 

Anyone have any trustworthy advice or people to talk to in Chiang Mai?

 

Thank you!

[BritManToo]

You can't get a WP to work in your own company as far as I know.

So best for your wife to start the company, and employ you as staff.

I think she needs to employ at least 3 Thai nationals, to be allowed to employ 1 foreigner.

[Chrisdoc]

You can't get a WP to work in your own company as far as I know.
So best for your wife to start the company, and employ you as staff.
I think she needs to employ at least 3 Thai nationals, to be allowed to employ 1 foreigner.

I think you can't own the company. You can get a work permit because it could not be your company. You can only own 49%. There is another very informative thread on this running at the moment. Someone has even put a cash breakdown for the expenses for his work permit.

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[bamboozled]

Yes, the idea would be for the wife to start the company and to hire me. Being married, it changes certain things, as far as I know, such as the amount of required capital and the number of employees (As I understand it, 1,000,000 baht capital and only 2 Thai employees and not 4 (and 1 would be my wife). I have also read, on the Thai gov. website, that exporting Thai products is looked upon favorably.

But I have also read some crazy numbers and the taxes and necessity of an accountant worries me.

[VocalNeal]

Best to make it her's.

You need 3 or 4 local employees per foreign work permit.

You don't need to show any money for the capitalized value. That's just the paper value. 

If you want to have some shares make it say 33% then it doesn't look like a farang forming a company for the sole purpose of getting a work permit. 

Minimum 50,000 baht a month income tax for you regardless of income declared.

 

From memory those are the basics.

 

 

[bamboozled]

From what I have read, if married, it is only two employees. ...Her business, that's fine with me. I read somewhere that the work permit itself is expensive.

 

[yankee99]

Dont bank on less then 4 employees, less than 2 mb registered capital. Its up to the local labor department so best to go ask directly.  you will not get medical insurance if you or your wife hold shares. 

 

As far monthly costs for accounting  and employee SS a minimum of 10k

[freedomnow]

18 hours ago, Chrisdoc said:

I think you can't own the company. You can get a work permit because it could not be your company. You can only own 49%. There is another very informative thread on this running at the moment. Someone has even put a cash breakdown for the expenses for his work permit.

Sent from my Lenovo TB-8304F1 using Thailand Forum - Thaivisa mobile app
 

Do you have a lead on that thread ?

[Tropicalevo]

18 hours ago, VocalNeal said:

Minimum 50,000 baht a month income tax for you regardless of income declared.

 

From memory those are the basics.

 

 

It is not 50,000 THB per month income tax. It is 50,000 THB per month taxable income. Slight difference.

[VocalNeal]

18 minutes ago, Tropicalevo said:

It is not 50,000 THB per month income tax. It is 50,000 THB per month taxable income. Slight difference.

yep my bad. I knew it was 50,000 something.

[Dogmatix]

You can work in any company that meets the requirements to get you a WP. It doesn’t matter if the shareholders include your wife, yourself or Tom and Auntie Sally. Four Thai employees are needed, although you might be given special permission to have less for the first year, if the company writes a letter explaining why it wants that, depending on the office you apply at.

 

Since you are American, you can own up to 100% of your own treaty company, if you are willing to go through some additional hoops to set it up. Or you can own 49% of a non-treaty company. For the non-treaty company 1 million in capital is needed if you are married to a Thai to get a WP. The treaty company needs more I think at least 2 million. You also need to be registered for VAT to get a WP.

 

The Labour Ministry has nothing to do with closing companies. If you closed your company there for 120 baht, it must be still registered and clocking up massive fines for failing to file accounts. You have to go to the DBD at the Commerce Ministry and, as in most countries, it is a fairly complex process like the accountant told you. It involves placing ads in newspapers to inform potential creditors that the company has applied to deregister to allow them to come and claim their debts back beforehand.

[elcaro]

16 hours ago, bamboozled said:

From what I have read, if married, it is only two employees. ...Her business, that's fine with me. I read somewhere that the work permit itself is expensive.

 

3,000 baht per year.

I got hired as a manager for my wifes company. The company was already a year old and has staff. All we did was go to our accountant. Paid her 5000 baht. She did all the paperwork and asked for a list of documents of me. They applied for a two year permit for me on friday. On Tuesday (monday was queens birthday) received a phone call that I could pick it up at the labour office for 6,000 baht.

 

So all together 11k for 2 year permit. Im allowed to do nearly everything. At least the things that were important for me. We did add some extra scope to the company so i could also use it for some freelance IT work in the future if i wanted to. This was done for free by the accountant and we paid for it ourselves at labour office. No more than 200 baht.

 

This was in Chiang Rai

 

 

[elcaro]

2 minutes ago, elcaro said:

She did all the paperwork and asked for a list of documents of me.

Off the top of my head.

Health certificate from hospital 400 from private

Signed copy of school diploma

Signed copy of passport pages including visa

Original passport

 

The company had to provide a gazillion signed copies it seemed.

[Krabi King]

My wife and I have a limited partnership, based on 51/49%. That is all you really need. And it is overall cheaper and easier then a Limitrd Company.

2 million capital was required for set up. If married, you only need 2 Thai employees per work permit. Since last year I did not need to bring them to the LD anymore when applying for my wp extension. So paying just social fees for them could be enough. My taxable income is 40,000, but that depends on nationality, I think.

Good luck!

[Captain 776]

I am not sure what the ratio is here or if Thailand has a ratio.

 

I was in Oil and Gas all over the world and every country I can remember had a ratio where we had to hire X number of local nationals per foreigner.

[bamboozled]

Thanks folks. This is some real useful information and perfect coming from the folks that did it real time.

 

Elcaro, what was the company that you signed on to? The costs to add you are certainly very reasonable and sounds like it was a breeze (at least from your end). The part that gives me pause is what the company is already paying to be set up...accountants, taxes, etc...etc...

 

Krabi King, are you having to pay an accountant and have a VAT number and all that jazz? Is your wife one of the two employees?

 

Thanks so much.

[khunPer]

On 6/11/2019 at 7:29 AM, bamboozled said:

My wife and I would like to start a company and sell things online, shipping 100% out of country. I would like a work permit...

You might need a Thai partnership limited with Thai wife. To my knowledge based on posts in other threads (please correct me if wrong) minimum capital is 1 million baht and two Thai employees for one foreign partner's work permit (actually half of what is need for a foreign work permit in a Thai company limited); your wife can count as one employee. Ownership need to be 49/51, as foreigners cannot own more than 49%.

 

There is no minimum salary needed if you extend your stay based on marriage to a Thai; however best if you officially pay some income tax, i.e. like of a salary of 50,000 baht a month.

 

Its a benefit for you to join the Social Security system, which at the moment is 10% of the salary, maximum 1,500 baht a month. Normally the employee pays half, i.e. 750 baht, and the employer pay the other half. Having SS you are eligible for health care in a government hospital; you can voluntary continue with SS later for a reduced fee (little under 500 baht), and keep the health care benefits.

????

[Muzarella]

On 6/11/2019 at 3:35 AM, bamboozled said:

Yes, the idea would be for the wife to start the company and to hire me. Being married, it changes certain things, as far as I know, such as the amount of required capital and the number of employees (As I understand it, 1,000,000 baht capital and only 2 Thai employees and not 4 (and 1 would be my wife). I have also read, on the Thai gov. website, that exporting Thai products is looked upon favorably.

But I have also read some crazy numbers and the taxes and necessity of an accountant worries me.

You are right about opening a company with your wife, a limited partnership, on any DBD loçal office (Department of Business Development) (see the website in English) spending 300 THB, without the needs to show any capital, but you will need a CPA to do taxes every year even without profit. Most CPA will charge over 5000 THB to do that, plus 10000 THB to close the company. Only will pay taxes for profits over 300.000 THB a year. About exporting, even online, ask for details with an export broker and the shipping company or post office. Can be expensive.

 

[bamboozled]

Khunper, that's pretty much what I have understood, too. So nice to hear it again. I did not know about the health benefit part, however. Why do you say 50,000 is best? If not, it seems suspicious I am working for so little? Is this info from personal experience? Also, do you know if accounting is required, VAT, and all the paper stuff?

 

Thank you.

[bamboozled]

There is also her opening a sole propietorship, from what I have read (was it on this thread perhaps?). That is even simpler. Though can she hire me and get work permit? We'll have to find out at the gov. office.

[Autonuaq]

The work you do must be on the list of allowed jobs for foreigners.

 

With that lost there also is a list of minimum income.

 

The company has to show a ceratin amount of money as regostered captial and this capital is per related to the number of foreigners and the kind visa they are entitled to have

The company probably also has to deposit some extra money to a fund that will be used if needed to remove foreigner from the country, this also is dpening on the type of visa that is issued to the forneigner.

 

Medical certificate is needed for the work permit.

 

The fees and taxes have to be paid for the number of people that are employed and per foreinger an x amount of Thai need to be full employed at resonable wages.

 

Not there are lists of minimum wages per role that tge official can use to check ligitimate wages that have to be paid to foreigners and positions they held as well for Thai.

 

The actual location of work is the area of what labour rules do apply.

So in yor case internatiinally seen you are working in Thailand and therefore Thai law applies, Thai taxes applies.

 

I see no calue for you to pay 4 time money to thai people. 

 

Be the investor and just get the profit.

Let your wife do the job

And hire two thais to do the work mamaged by your wife

 

Saves you 2 thai peolle you not need and that times 9000 thb plus taxes as well that you have to pay as wierd wage because of the index.

 

49% of the profit as a shareholder is more too. Not forget the salary you must have and taxes you have to pay you not need to pay and make.

 

 

 

[Chrisdoc]

Do you have a lead on that thread ?

https://forum.thaivisa.com/topic/1105381-taxes-on-work-permit-other-questions-please-help/

Taxes on Work Permit & other questions. Please help

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[khunPer]

2 hours ago, bamboozled said:

Khunper, that's pretty much what I have understood, too. So nice to hear it again. I did not know about the health benefit part, however. Why do you say 50,000 is best? If not, it seems suspicious I am working for so little? Is this info from personal experience? Also, do you know if accounting is required, VAT, and all the paper stuff?

 

Thank you.

You can read more about Thai Social Security here, and rather detailed on the US Social Security homepage under Thailand.

 

The 50,000 was merely mentioned to get in line with the common extensions based on business, i.e. pay tax like having a 50k baht monthly salary to make everybody happy; its about 3,500 baht tax a month. But check with an accountant, you'll need an accountant anyway for annual statements when forming a partnership.

 

If you are having a higher salary, fine, then no problem; however let your accountant find out if there are any benefits from having some money out in dividend, with dividend tax, instead of as taxable income. I'm not familiar with partnerships, but in a company limited that could be an advantage.

 

V.a.t. is depending on number of employees – used to be nine – but might also be a question of turnover. Small set-ups don't need to register for v.a.t.; however an accountant will know all that with up-to-date details.

 

In some cases an accountant can do (all) the paperwork – your wife could also do it, but if no experience it might be better do have professional assistance, rather than making errors that are difficult to correct later – or you can use a lawyer. Its free to ask for preliminary advise and costs, so get a few quotes.

????

[Alex2554]

The Civil and Commercial Code book 5

In managing the property acquired by either spouse during marriage the husband and wife have to be joint manager or one spouse has to obtain consent from the other

 

1. 51/49 is impossible

2. your wife can not hire you

[Dogmatix]

15 hours ago, khunPer said:

You might need a Thai partnership limited with Thai wife. To my knowledge based on posts in other threads (please correct me if wrong) minimum capital is 1 million baht and two Thai employees for one foreign partner's work permit (actually half of what is need for a foreign work permit in a Thai company limited); your wife can count as one employee. Ownership need to be 49/51, as foreigners cannot own more than 49%.

 

There is no minimum salary needed if you extend your stay based on marriage to a Thai; however best if you officially pay some income tax, i.e. like of a salary of 50,000 baht a month.

 

Its a benefit for you to join the Social Security system, which at the moment is 10% of the salary, maximum 1,500 baht a month. Normally the employee pays half, i.e. 750 baht, and the employer pay the other half. Having SS you are eligible for health care in a government hospital; you can voluntary continue with SS later for a reduced fee (little under 500 baht), and keep the health care benefits.

????

 

If you are in the SS scheme, you are entitled to healthcare at a private hospital that is part of the SS scheme, not a government hospital. When you join and each subsequent year, the SS will send you a paper membership card to a hospital near you. You are allowed to transfer to another hospital, if you don’t like it. 

 

The staff may may be better at a private hospital but the list of things they will treat and drugs they can provide is not the same. E.g. A few years ago government hospitals were approved to give retroviral drugs to HIV sufferers but the SS was not. That caused many HIV patients to quit their jobs to get out from SS and into the govt scheme. Ridiculous but that is one of the problems of running three very different public health schemes side by side: government, SS    and Civil Service. The civil servants design the policies but don’t care about the people who have to use them because they have their own scheme with far more benefits than the other two which sucks but that’s Thailand.

[Dogmatix]

11 hours ago, khunPer said:

You can read more about Thai Social Security here, and rather detailed on the US Social Security homepage under Thailand.

 

The 50,000 was merely mentioned to get in line with the common extensions based on business, i.e. pay tax like having a 50k baht monthly salary to make everybody happy; its about 3,500 baht tax a month. But check with an accountant, you'll need an accountant anyway for annual statements when forming a partnership.

 

If you are having a higher salary, fine, then no problem; however let your accountant find out if there are any benefits from having some money out in dividend, with dividend tax, instead of as taxable income. I'm not familiar with partnerships, but in a company limited that could be an advantage.

 

V.a.t. is depending on number of employees – used to be nine – but might also be a question of turnover. Small set-ups don't need to register for v.a.t.; however an accountant will know all that with up-to-date details.

 

In some cases an accountant can do (all) the paperwork – your wife could also do it, but if no experience it might be better do have professional assistance, rather than making errors that are difficult to correct later – or you can use a lawyer. Its free to ask for preliminary advise and costs, so get a few quotes.

????

My recollection is that the VAT registration certificate was one of documents required for application for a WP. Normally a company only needs to register for VAT, turnover is B180,000 a month or more but to get a WP it needs to register and complete monthly VAT returns anyway.

[Dogmatix]

7 hours ago, Alex2554 said:

The Civil and Commercial Code book 5

In managing the property acquired by either spouse during marriage the husband and wife have to be joint manager or one spouse has to obtain consent from the other

 

1. 51/49 is impossible

2. your wife can not hire you

 

I am not sure of the advantages of s limited partnership. It seems only used by old fashioned Chinese shophouse businesses these days. The limited partnership has to file audited accounts, just the same as a limited company.  What is quite different is an unlimited partnership but the advantages of those were eliminated by the Revenue Dept. I was the impression that the effective share split in a partnership was determined by the number of partners, I.e. 2 partners 50:50, 3 partners 33.333, 5 partners 25% each but perhaps that only applies to unlimited partnerships. In the latter case, if one of the partners dies, the partnership has to be dissolved.

[Dogmatix]

If you are married to a Thai and have been working legally for three years with a salary of 40,000 plus, you are entitled to apply for citizenship. It had better be a company with a real business as there will be some scrutiny.

[Krabi King]

18 hours ago, bamboozled said:

Krabi King, are you having to pay an accountant and have a VAT number and all that jazz? Is your wife one of the two employees?

Yes, we pay for accounting. Ours charges 2000 THB per month and 7000 1 time per year for the audit.

We don't have a VAT number. As I understand you only need this when turnover reaches 2 million or more.

My wife is not an employee. We are both owners. My work permit says I am responsible for daily operations and running the business.

When we opened our company many years ago, we did not need to show capital in our account. Just on paper. I think I heard that changed now. At least when a foreigner is involved (as a co owner, not as an employee). 

 

[bamboozled]

More useful info, thank you. Seems like a bit of a minefield out there, not surprisingly. Anyone have any real-time experience on, for example, wife opening sole-proprietorship business and hiring husband/getting work permit?