Representative Office in Thailand

A representative office in Thailand is a non-trading entity that serves as an extension of its foreign parent company. It allows foreign businesses to establish a presence in Thailand without engaging in direct income-generating activities12.

The main advantages of setting up a Representative Office in Thailand is the possibility to support one work permit per foreign employee with only one Thai employee (the ratio for a limited company is 4 Thai employees per foreign employee except if the company has obtained a promotion from the Board of Investment). The maximum number of foreign employees is usually 3 (it is sometimes possible to obtain several more work permits depending on the activity of the Representative Office).

As the Representative Office cannot generate income in Thailand, it is not subject to corporate income tax. However, the employees are still subject to the personal income withholding tax on their salaries.

No, representative offices are strictly prohibited from engaging in any direct sales or revenue-generating activities within Thailand.

There's no set time limit, but the Thai government may review the office's activities periodically to ensure compliance with regulations.

Yes, representative offices can employ Thai nationals in addition to their foreign staff allocation.

No specific restrictions exist, but most representative offices choose to locate in major business centers like Bangkok.

Since representative offices don't generate income, they're typically not subject to corporate income tax. However, they may be liable for other taxes such as withholding tax on employee salaries.

A Representative Office has the ratio of 1 Thai employee per foreign employee but its activities are limited and it cannot generate income while a Thai Limited Company with a local partner can carry out most business activities without any specific restrictions. The key differences are highlighted below: