Thai limited company vs representative office
A Thai limited company is a local legal entity that can trade and earn revenue, with shareholders, directors and foreign-business compliance once foreign ownership passes the threshold. A representative office may only carry out non-revenue support activities such as sourcing, quality inspection and market reporting for its head office.
Bottom line: If you will sell and invoice in Thailand, incorporate a limited company. If the goal is market testing, supplier quality control or head-office coordination, a representative office carries a lighter burden as a first step.
Side-by-side comparison
| Criterion | Thai limited company | Representative office |
|---|---|---|
| Can earn revenue in Thailand | Yes, fully | No — support activities only |
| Ownership | Shareholders per law; a licence may be required for majority foreign ownership | An extension of the overseas parent |
| Tax | Corporate income tax and VAT as applicable | No profit to tax in principle, but filings and withholding still apply |
| Hiring foreigners | Subject to capital and Thai-staff ratio rules | Limited headcount tied to the permitted activities |
| Set-up speed | Faster for a standard structure | Depends on the reviewing authority |
Choose Thai limited company when
- You must invoice and collect payment in Thailand
- You need to hire staff and sponsor work permits
- You plan long-term expansion or investment promotion
Choose Representative office when
- You want to test the market before full investment
- You source goods and inspect quality for the parent
- You do not need Thai revenue yet
Documents to prepare
- Parent-company certificate with translation and the legalization chain
- Power of attorney for the local representative
- Activity description and budget plan
- Office premises documents
- Passports or Thai IDs of directors and shareholders
Step-by-step process
- Define precisely what the entity will do in Thailand
- Choose the structure and check foreign-business restrictions
- Prepare parent-company documents with full translation and legalization
- Register or file with the competent authority
- Register for tax and social security and open bank accounts
- Set up bookkeeping and a monthly/annual filing calendar
Common pitfalls
- Letting a representative office perform revenue-generating work
- Using nominee shareholders to bypass foreign-ownership limits — illegal
- Parent documents lacking the full legalization chain
- Skipping monthly tax filings even with no revenue
Frequently asked questions
- Can a representative office invoice clients?
- No. Its activities are limited to non-revenue support. Trading or charging for services requires an entity permitted to do business.
- How much can foreigners own in a Thai company?
- It depends on the activity. Many are restricted under the foreign business legislation, which may require a licence, a treaty right or an investment promotion.
- Can a representative office convert into a company?
- In practice you incorporate a new entity and migrate staff and contracts; plan continuity for agreements, work permits and tax.
- How do you help?
- We advise on structure selection, tax and work-permit planning, prepare and legalize parent-company documents, and handle ongoing filings after set-up.
Prefer not to run the paperwork yourself?
Our team is an advisory practice, not just a filing agency. With 15+ years of cross-border document work we map the full route before you spend anything: we confirm what the receiving authority actually accepts, sequence translation, notarisation and legalisation in the right order, forecast a realistic timeline, and flag the details that normally cause rejections. Send us photos of your documents for a free initial assessment.
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