Business practicalities in Thailand

Land and property rights

A valid address is required to establish a business in Thailand. Office or factory space can be found independently or through a local real estate agent.

Ownership of land in Thailand is governed by the Land Code Act. Under this law, foreigners are not allowed to own land in Thailand. However, there are some structures that enable part foreign ownership. Some foreign investors establish a Thai Limited Company to acquire land, with Thai nationals holding at least 51 percent ownership as required by law. However, using a nominee structure where Thai shareholders act as placeholders is illegal and can result in severe penalties. Foreigners are also permitted to own a house or a structure on a piece of land and can lease land for up to 99 years. Once a leasehold is established, the foreigner can apply for a permit to build a structure. These leasehold arrangements are common in Thailand.

Foreigners can legally own condominiums in Thailand under the Condominium Act, provided that foreign ownership does not exceed 49 percent of the total floor space in a given condominium project. Some foreign corporations operating in Thailand can also obtain special privileges and exemptions for land ownership through the Board of Investment (BOI) under the Investment Promotion Act or other relevant acts. Currently there is no direct path for individual foreigners to own land outright in Thailand.

Australian businesses should conduct thorough due diligence before investing in Thai real estate. Consulting legal experts familiar with Thai property laws is essential.

Cybersecurity

Cybersecurity laws and regulations are managed by the Thai National Cyber Security Committee of Thailand (NCSA). From 2025, all critical information infrastructure operators (CIIOs) in Thailand must implement baseline cybersecurity protection measure in their data and information systems.

CIIOs are designated by the relevant industry regulator and include companies that provide or are involved in providing ‘critical services’. These sectors include national security, public services, banking and finance, IT and telecommunications, transportation and logistics, energy and public utilities and public health.

Australian businesses in any sector should ensure they have appropriate policies and systems in place to protect themselves against cyber security threats. More information on cyber security for Australian businesses can be found at the Australian Signals Directorate’s Australian Cyber Security Centre (ASD’s ACSC).

Intellectual property (IP)

Thailand’s legal framework supporting intellectual property has made significant progress in aligning with international standards and improving enforcement, though some uncertainties and enforcement challenges remain.. As a member of the World Trade Organization (WTO) and World Intellectual Property Organization (WIPO), Thailand generally complies with international IP standards established by the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). While it is also a signatory to the Paris Convention, the Berne Convention, the Madrid Protocol and the WIPO Copyright Treaty, there is some uncertainty around aspects of patent protection, compulsory licenses and design rights. 

Recent efforts by the Thai government to improve the awareness and enforcement of IP laws in Thailand has seen progress on the protection of IP in the country. However, companies are advised to consider obtaining intellectual property rights protection in Thailand before introducing their products or services to the Thai market. They should also seek advice from local IP law experts before disclosing technologies or IP business information to potential local partners.

The Department of Intellectual Property (DIP) oversees and administers Thailand’s IP system. A local address and a local agent or attorney are generally required when filing IP applications in Thailand. Non-residents of Thailand can only register by granting a Thai resident power of attorney. The DIP has implemented a series of e-services and introduced fast-track programs for patent and trademark registrations. Applicants must comply with four conditions, including that the total number of goods and services must not exceed 30 items, but there is no additional fee for this fast-track service.

The main intellectual property rights (IPR) and IPR-related rights in Thailand are invention patents, petty patents, product design patents, trademarks, copyrights, geographical indications (GI), trade secrets, semiconductor topography rights and right related to plant varieties.

Violation of IP and enforcement options:

IP rights disputes in Thailand can be complex. Businesses seeking to enforce their IP rights in Thailand have three options:

• Administrative enforcement
• Criminal enforcement
• Civil enforcement 
• Customs enforcement

In Thailand, the Central Intellectual Property and International Trade Court (CIPITC) is a specialised court that adjudicates IP disputes, including infringement and invalidity issues. If legal action by a non-resident is required, a power of attorney will be needed to be granted to a Thai representative. If such action is necessary, businesses are advised to seek advice from local IP law experts. Businesses can also consult IP Australia for advice.

Import duties and tariffs 

Thailand is a member of the World Trade Organization (WTO). The country imposes Most-Favoured-Nation (MFN) import tariffs on goods and services from other WTO members. These rates vary by product. The simple average MFN tariff rate for imports was 9.8 per cent in 2023. The simple average for agricultural products was 27 per cent and non-agricultural products was 7.1 per cent. There is binding tariff coverage for 76.9 per cent of Thai imports, with an average bound tariff rate of 26.6 per cent.

Australian exports to Thailand qualify for preferential rates under the Thailand-Australia Free Trade Agreement (TAFTA), the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) and the Regional Comprehensive Economic Partnership (RCEP). The TAFTA has eliminated tariffs and quotas on almost all goods exports from Australia to Thailand.

Thailand uses the ASEAN Harmonized Tariff Nomenclature (AHTN) 2022 for the classification of import tariffs. To find the tariff rate for specific goods, visit the Department of Foreign Affairs and Trade’s FTA Portal at ftaportal.dfat.gov.au/. For up-to-date information visit customs.go.th. For specific import tariff details visit itd.customs.go.th.

Calculations and payments 

Thailand follows the WTO Valuation Agreement on imported goods. Import duty is calculated by multiplying the imported good’s dutiable value by the corresponding import duty rate. The dutiable value of imported goods is typically based on the cost, insurance and freight (CIF) level under the International Commercial Terms (incoterms).

Import duty is payable once the vessel carrying the imported products arrives in Thailand, and customs procedures for imports into Thailand are similar to most countries.

Other taxes and charges

There is a 7 per cent Value Added Tax (VAT) imposed on all goods imported into Thailand. Additionally, Thailand imposes an excise tax on select goods at the time of import. The rates are ad valorem, and vary based on the product. Many of the products on which VAT is imposed are considered to be ‘luxuries’. These include automobiles, motorcycles, perfumes and cosmetics, some types of beverages (alcoholic and non-alcoholic) and tobacco products.

Export duties 

Export duties are only charged items that include raw silk, rubber, animal hides and wood products.

Import and export regulations

Thailand’s Ministry of Commerce (MOC) regulates trade in Thailand. Its primary trade regulations are the Customs Act, the Foreign Business Act and the Trade Competition Act.

The import of certain goods is restricted in Thailand on grounds of health or security. The MOC bans the export of products such as unmilled rice and rice bran. Thailand also imposes an export license requirement for the export of certain goods such as sugar, rice, seeds, gold, cattle, coffee and wood. A list of controlled imports and exports can be found at the Thai Customs website.

Thailand uses a national single window (NSW) to simplify trade processes – the NSW brings together 38 government agencies, ministries and private bodies to reduce procedural times and costs for traders.

Thailand imposes a wide range of taxes including personal, corporate and petroleum income tax. Indirect taxes are also common and include a value added tax, specific business tax, excise tax and stamp duties.

Thailand’s Revenue Department administers the personal income tax, corporate income tax, petroleum income tax, value added tax, specific business tax and stamp duties. The Customs Department administers customs duties and the Excise Department at the Ministry of Finance oversees excise tax.

This section provides an overview of the taxes Australian businesses can expect to face when operating in Thailand. Not all applicable taxes are covered in this guide and the information provided is of a general nature. Businesses should seek professional tax advice for understanding the taxes specific to their activities.

Table 1: Overview of Thailand’s taxes for businesses

Corporate Income Tax (CIT)

Businesses are subject to the tax rates imposed under the Revenue Code. The standard CIT rate is 20 per cent. Companies incorporated in Thailand pay tax on their global income.

Any company that is incorporated overseas is taxed in Thailand on profits it makes from business conducted in the country. A foreign company without any business in Thailand is subject to a final withholding tax (WHT) on certain income times, such as interest, dividend, royalties, rentals and service dees that are either received from Thailand or in the country. If an Australian company is not deemed to be a tax resident in Thailand, it can benefit from the doubletax avoidance treaty between the two countries.

Companies that have paid-in capital of under AUD 212,224 (THB 5 million) and revenue of less than AUD1.27 million (THB 30 million) are taxed at the following rates:

Thailand imposes a separate petroleum income tax on foreign companies that are involved in oil exploration and production, either under a concession or on a production sharing or service contract. Companies under a concession are taxed at 50 per cent of net profit, while companies in production sharing agreements are taxed 20 per cent of the proportion of their annual net profit that is derived from petroleum operations. Companies that are subject to petroleum income tax are exempt from paying other taxes and duties on income.

Personal income tax (PIT)

Individuals residing in Thailand for 180 days or more in any tax year are classified as tax residents under Thai law. Any Thai tax resident must pay PIT on income from both within Thailand as well as from abroad. A non-resident is liable to pay PIT only on income generated from sources in Thailand.

Thailand employs a progressive tax system. The highest tax rate payable for residents and non-residents is 35 per cent. Australia has a double taxation agreement (DTA) with Thailand which aims to avoid double taxation on personal income and the petroleum income tax. Individuals are advised to seek advice from a professional with knowledge of tax law in Thailand and Australia to ensure compliance with the DTA.

Individuals are subject to the following progressive tax rates.

Individual tax rates – Employment income

Indirect taxes

Value-added tax: Thailand imposes a value-added tax (VAT) of 7 per cent on the sale of goods and provision of services, reduced due to the COVID-19 pandemic until September 2026, from the standard rate of 10 per cent earlier. This does not include goods such and services such as groceries, education, healthcare, property leasing and the sale of real estate. Additionally, non-resident electronic service providers and platform operators generating more than AUD 81,672 (THB 1.8 million) per year from the provision of services to non-VAT-registered customers must register for VAT and pay VAT.

Specific business tax (SBT): Some businesses in Thailand are required to pay SBT where gross revenue is not subject to VAT. These include financial businesses such as commercial banking, and those that involve the sale of immovable property and life insurance. Tax rates range from 0.1 to 3.0 per cent.

Land and building tax: This new tax came into effect at the start of 2020, replacing the local maintenance tax and household and land tax. Any individual or business that owns or possess either land or buildings is subject this tax. This includes land for agricultural processes, aquatic animal farming, livestock farming, residential use and others. The tax rates range from 0.15 to 1.2 per cent.

Carbon tax: The Thai government has said a climate change bill expected in late 2025 or early 2026 would incorporate a carbon tax focusing on energy, transport, industry, waste management and farming. All of these sectors must reduce greenhouse emissions by 40% by 2035.

Auditing and accountancy play a vital role in enhancing transparency and accountability in a business, especially one engaged in a foreign market. It increases business performance by identifying risks and highlighting areas for improvement.

Accounting standards

Local and foreign businesses are required to comply with the Thai Financial Reporting Standards (TFRS), which are based on IFRS Accounting Standards. The Federation of Accounting Professions (TFAC) is the official body that sets standards in the country.

Public companies operating in Thailand must follow TFRS, while private companies usually use the TFRS for non-publicly accountable entities (NPAEs), although they could choose to adopt TFRS instead if they want to. Foreign companies in Thailand may choose to apply IFRS standards.

Statutory audits

All companies incorporated in Thailand must keep accounting records and be audited annually. Documents must be maintained in Thai. If documents are prepared in another language, Thai translations must be enclosed.

All businesses operating in Thailand, including partnerships, joint ventures and branches of foreign companies, must prepare financial statements. For foreign companies, the timeframe to file statements is no later than 150 days from the end of the fiscal year, which typically runs from 1 January to 31 December.

An independent certified auditor is required to audit and certify all financial statements, and must include an auditor’s opinion, which is mandatory when filing financial statements.

Books and records 

Businesses must follow accounting procedures set out in the Civil and Commercial Code, the Revenue Code and the Accounts Act. The books can be prepared in any language provided a translated is provided in Thai.

Companies have to prepare balance sheets and profit and loss accounts each accounting year. They must retain their books of accounts for at least five years or seven years, depending on business activity

Annual General Meetings (AGMs)

Companies must hold their AGMs at least once a year, within four months from the end of the fiscal year.

Quality control 

Thailand’s Securities and Exchange Commission (SEC), which is a member of the International Forum of Independent Audit Regulators, directly supervises and regulates auditors of entities such as listed companies, brokers, dealers, collective investment schemes and asset management companies. It additionally monitors audit firms’ quality control and ensuring that auditing and accounting standards are employed.

Other entities’ auditors are regulated by the Federation of Accounting Professions (TFAC).

Doing business in Thailand will often require employing local and foreign workers. Understanding Thailand’s labour market regulations, recruitment methods and country-specific management styles is crucial to build and support an effective team.

Labour market

Skill level: Thailand has a large but relatively underskilled workforce. It is faced with a skills shortage, with a high share of young adults that have belowthreshold foundational skills such as reading and computing. The Thai government is aware of the skills shortage and is working to improve the standards of education and access to learning. Thailand’s literacy rate is 94 per cent and although only 53.6 per cent of Thais have completed lower secondary schooling, and 39.6 per cent have completed upper secondary schooling, these percentages are rising rapidly.

Thailand’s labour force participation rate stood at 67.2 per cent in 2024, and its unemployment rate was 1 per cent in 2024.

Employment contracts: Most Thai employment contracts are fixed-term or permanent contracts. An employment contract in Thailand applies to both full-time and fixed-term employees. According to Thai law, a contract can either be oral or in writing, but any contract should be in writing to ensure the terms of employment are clear. If there is no clearly defined contract in place, the Thai legal system can often rule in favour of an employee. Contracts of employment should include the responsibilities of an employee, compensation and benefits and termination requirements.

Minimum wage: Minimum wages in Thailand range from AUD 15.65 (THB 345) to AUD 18.15 (THB 400) per day,depending on the work and region. Provinces such as Bangkok, Nakhon Pathom, Nonthaburi, Pathum Thani, Samut Prakan and Samut Sakhon have higher minimum wages than others, but the differences are marginal.

Human resources and employment law: The Labour Protection Act B.E. 2541 (1998) is the primary legislation covering Thailand’s labour landscape, and it sets out the terms and conditions of employment for various types of workers. Other acts that cover different aspects of employment include the Labour Relations Act (No. 2) B.E. 2518 (1975), the Workmen’s Compensation Act of 1994, the Thai Civil and Commercial Code and the Employment Jobseeker Protection Act B.E. 2528 (1985).

Working hours: Thailand has clear laws and guidelines relating to working hours and employee compensation. The daily cap is set at 8 hours per day, and the weekly cap is 48 hours. There are some variations by sector, such as in healthcare and manufacturing. Thailand’s labour law mandates a rest period of at least 1 hour after a work period of 5 consecutive hours.

Holidays: Upon completing a full year of employment, an employee is entitled to a paid annual leave of at least 6 working days. They are additionally entitled 3 days of personal business leave per year.

Overtime: Overtime is capped at an additional 36 hours over and above the 48 standard hours of employment per week. If employees work more than the standard 8 hours on a regular workday, they must be compensated additionally at a rate of 150 per cent of the employee’s hourly wage.

Overtime rates

Sick leave: Employees are allowed up to 30 days of sick leave in a year. Employers can require a medical certificate if an employee takes more than 3 consecutive days off due to illness.

Social, health and unemployment insurance contributions: It is mandatory for employers to register any employee aged between 15 and 60 with the Workmen Compensation and Social Security Fund (SSF). The contribution rate for both employers and employees is 5 per cent, capped at AUD 34.03 (THB 750) per month. Foreigners working in Thailand are entitled to the same benefits. The benefits granted to those registered with SSF include injury, sickness, maternity, disability, death, child, old-age and unemployment benefits (with some exceptions).

Ending employment: An employer can terminate an employee’s contract with legal cause without any notice or payment in lieu of the standard notice period. For the termination of an employment contract without legal cause, an employer must provide written notice to the employee of at least one pay cycle. The employer also has the option to pay the employee for the notice period.

Severance pay: Employees who have worked for more than 120 days at a company are entitled to severance pay in the event of termination of employment at the following rates:

Recruiting staff

Online advertising: Online job advertisements are an effective way to access talent in Thailand. There are several useful websites in Thailand for online advertising:

• JobBKK is a popular platform with more than 3.1 million registered Thai users, covering most industries.
• JobsDB is one of Southeast Asia’s most frequented job portals, and is popular in Thailand.
• ThaiJob is an affordable platform that covers the broad Thai workforce.
• WorkVenture is a popular board for candidates with academic, professional or technical qualifications. The job portal has more than 300,000 registered users, of which more than 90 per cent have a university degree.

Executive search and recruitment: Executive search firms can provide tailored searches for more senior roles. International firms such as Michael Page, Robert Walters, SmartCruit and JAC Recruitment have offices in Thailand.

Work permits: Foreigners who want to work in Thailand must have a non-immigrant work visa as well as a work permit. Individuals must first possess a non-immigrant visa, which is essential to apply for a work permit. Work permits allow foreigners to work and operate businesses in Thailand as either skilled professionals or employers. Any foreign business entities that want to apply for a work permit can do so if they bring at least AUD 90,747 (THB 2 million) per employee into Thailand.

Foreign companies establishing a commercial presence in Thailand will need a local back account to conduct business in the country. Foreign companies may open accounts denominated in the Thai baht or foreign currencies.

The following documentation is required for foreign companies that want to open a bank account in Thailand. After this documentation is provided, a meeting with the manager of the bank’s local branch is required:

• Company registration certificate copy
• Stamped minutes of board meeting authorising the opening of the account and designating signatories
• Company tax ID card
• ID or passport of every board member and shareholder with more than a 25 per cent share
• Copy of the articles of association and the memorandum of association
• Form BOJ 3, which is the official record of the company’s registration details, or Form BOJ 4 (if amendments to the registration details have been made)
• Shareholder list

Companies can open either local currency denominated corporate accounts, or those denominated in foreign currencies. Financial institutions in Thailand are classified into depository and non-depository corporations.

Table 3: Financial institutions in Thailand

Australian banks in Thailand

ANZ is the only Australian bank in Thailand that supports institutional and corporate clients. It has local and foreign currency corporate banking capabilities, and provides clients with basic banking needs, core payment and cash management solutions and international trade products. It also provides access to onshore and offshore markets products for foreign exchange.

Foreign exchange controls

The Thai baht is almost freely convertible. It is fully convertible for current account transactions and most capital flows are free. However, the Bank of Thailand continues to supervise foreign exchange transactions and business activity related to foreign exchange to maintain exchange rate stability. It does this through a managed-float exchange rate regime.

All foreign exchange transactions in Thailand must happen through commercial banks and authorised non-banks such as money changes, money transfer agents and other companies that have been granted forex licenses. There is no limit on the amount of foreign currency that can be brought into Thailand. Any person receiving foreign currencies from overseas must sell the funds to an authorised bank or deposit into a foreign currency account within 360 days of receipt.

Foreign currency can be purchased from authorised banks if documentation showing international trade or investment operations are presented. For companies that conduct business in foreign currencies, derivative transactions are permitted to hedge against currency risk.

It is permitted to repatriate investment funds and repay overseas loans, provided supporting documents are submitted to an authorised bank. Any amount of AUD 1.54 million (USD 1 million) or more received either for the export of goods or the provision of services overseas must be converted into Thai baht immediately on payment within 360 days of receipt, the amount must be either deposited into a foreign currency account with an authorised bank or sold. Importers can purchase or withdraw foreign currencies from their own accounts for the payment of imports once they provide supporting documents.

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