Hello, my name is Robert. I am a Legal Manager at Siam Legal International. In this video, I will discuss the proper method of closing a business operation in Thailand.
It is a great challenge for a foreigner to open and operate a business in Thailand.
Thailand has arcane bureaucratic rules that create hurdles to starting a company.
Thai is a difficult language to learn. It is difficult to review contracts or negotiate with suppliers and clients in a foreign language.
The differences in culture can generate conflicts between an employer and employees.
Sometimes all of these issues combined with business competition makes it difficult to keep a business open.
The decision to close down a business is a difficult one. It must be done properly to reduce the risk of future lawsuits against the business owner or managers.
What needs to be done?
- File for dissolution of the company with Department of Business Development.
- If the company is solvent, the company must liquidate its assets.
- If the company is insolvent, the shareholders have to put additional capital into the business or the liquidator can start bankruptcy proceedings.
- The company must file its tax return and pay all taxes due. A bankruptcy will not discharge a tax debt or Employee salaries.
- Employees have to be paid their salary and severance.
- If there are foreign workers, work permits have to be returned to the Ministry of Labor within 7 days.
- Suppliers and customers need to be legally notified of the termination of business. Arrangements should be made to terminate any existing contracts.
- Banks and financial accounts should be closed down.
- Landlord should be sent notice of the end of the business operations and the termination of the lease.
- Any surplus after taxes and debts are paid should be distributed to the shareholders.
Closing down a business is a sad time but it is necessary to ensure that the business is closed down properly.
If you have questions or need assistance with the process, please contact Siam-Legal International for answers.
See also the registering of company’s dissolution and registering the completion of liquidation here.