Insights
Starting a Business in Thailand: EOR or a Local Company? (2026)
Insights · By Chen ChunJie · Updated 31 October 2026
A foreign company can start working in Thailand in two ways: set up its own Thai company, or hire through an employer of record while it tests the market. A Thai private limited company needs at least two shareholders, registration with the Department of Business Development, a tax ID and social security registration before it can hire, and if foreign shareholders hold more than 49%, many service activities also need a Foreign Business Licence or BOI promotion. An employer of record lets you hire Thai employees without any of that, but it does not give your company a licence to trade in Thailand. This guide explains when each route fits.
Last reviewed in October 2026. General information, not legal or tax advice. Confirm the steps for your activity with a Thai lawyer.
Hiring people and doing business are different things
An employer of record solves the employment question: who employs the person, runs payroll and meets Thai labour law. It does not let your company sell, invoice or hold licences in Thailand. If you will sign contracts with Thai customers, import goods or need a regulated licence, you need your own Thai entity, a licensed partner or another structure. If the person will support customers abroad, build products or explore the market, an employer of record is often enough to start.
EOR or a Thai company: how they compare
| Question | Employer of record | Your own Thai company |
|---|---|---|
| Time to first hire | As soon as the contract and onboarding are complete | After incorporation, tax and social security registration and a bank account |
| Who employs the person | Our local employer | Your company |
| Can sell and invoice in Thailand | No | Yes, subject to foreign ownership rules and licences |
| Foreign ownership limits | Not relevant to the hire | Above 49% foreign ownership, many services need a Foreign Business Licence or BOI promotion |
| Work permits for foreigners | Reviewed case by case | Company must meet capital and Thai staff tests, unless BOI-promoted |
| Ongoing administration | Handled by the EOR | Monthly tax filings, payroll, audit and annual returns |
| Best for | One or a few Thai employees, market testing | A long-term team, local sales or regulated activity |
Setting up a Thai company
- Choose the structure: a private limited company is most common; a branch or representative office has narrower uses
- Check foreign ownership rules: above 49% foreign shareholding, many service activities need a Foreign Business Licence, unless BOI promotion or a treaty applies
- Reserve the company name and register with the Department of Business Development; at least two shareholders are required
- Obtain a corporate tax ID, and register for VAT if turnover will exceed THB 1.8 million a year
- Open a Thai bank account and pay in the capital
- Register as an employer with the Social Security Office within 30 days of the first hire
- Prepare work rules in Thai once you have 10 or more employees
Corporate income tax is 20%, with lower rates for qualifying small companies. A company that wants work permits for foreign staff usually needs THB 2 million of paid-up capital per work permit and four Thai employees for each foreigner, unless it is BOI-promoted.
BOI promotion
The Board of Investment promotes companies in targeted sectors, such as technology, advanced manufacturing and regional headquarters. Promotion can allow full foreign ownership, tax incentives and easier work permits, but it comes with conditions on investment, activity and reporting. Eligibility is assessed case by case.
A common path: start with EOR, then move to your own company
Many companies hire their first Thai employees through an employer of record, then set up a Thai company once the business case is proven. When the company is ready, employment can move to it with the employee’s agreement, and service years and benefits can be carried over so the employee does not lose severance rights. Our Thailand payroll service can then run the new company’s payroll.
Questions about starting a business in Thailand
Can a foreigner own 100% of a company in Thailand?
For many activities, only with a Foreign Business Licence, BOI promotion or a treaty exemption. Otherwise foreign ownership is usually kept at 49% or less.
How many shareholders does a Thai company need?
A private limited company needs at least two shareholders, since a 2023 amendment to the Civil and Commercial Code.
Do I need a Thai company to hire employees in Thailand?
Not if you use an employer of record, which employs the person for you. You do need one to sell or invoice in Thailand. See Employer of Record in Thailand.
What does a Thai employer need before the first hire?
A tax ID, a bank account and registration with the Social Security Office within 30 days of the first hire, plus a payroll process for monthly PND.1 and social security filings.
How much does it cost to employ someone in Thailand?
Salary plus employer social security of up to THB 875 a month, workmen’s compensation and benefits. See Thailand EOR cost.
Need people in Thailand before your company is ready?
Tell us about the role and we will reply with the annual employment cost and a realistic start date.
Related
A 2026 employer checklist.
Employer costs and worked examples in baht.
Official sources: Labour Protection Act, English text (ILO NATLEX); Ministry of Labour, labour law overview; Government Public Relations Department, Labour Protection Act amendment on maternity and family leave; Government Public Relations Department, 2026 social security wage ceiling; Royal Gazette, Royal Decree on the start of Employee Welfare Fund collection (22 October 2026); BOI One Start One Stop, employer contributions; Revenue Department, deductions for employment income; Ministry of Labour, minimum wage from 1 July 2025. Also: the Social Security Act, the Workmen’s Compensation Act, the Revenue Code and Minimum Wage Notification No. 14. The English text of the Labour Protection Act predates later amendments; amended rules are cited from the announcements above. Reviewed October 2026; general information, not legal or tax advice.