Thailand free zones

Thailand provides several free zones, locally known as “special economic zones”, enabling foreigners to register companies in the country, while enjoying simpler registration procedures, full foreign ownership and generous tax incentives. Please find more information on this page regarding registration of a Thailand business in these special economic zones.

Advantages of registering a company in a Thailand special economic zone

Thailand free trade zones company registration

  1. Free Zone company formation allows our Client to benefit from the following tax advantages:
    • Most of our Clients interested to register a company in a Thailand Special Economic Zone also request us to submit an application to secure BOI promotion status (click link). After review of their investment project by the Board of Investments, such investment projects can benefit from tax incentives including i) up to eight years of corporate tax holidays and ii) reduced or waived custom duties on imports of raw material and equipment;
    • If the company secures BOI promotion status, the company can then secure additional tax benefits including: i) up to three additional years of corporate tax exemption and/or ii) reduced corporate tax rate of 10% during the following eight years;
    • If the company does not secure BOI promotion status, the special economic zone authority can decide to grant some or all of the tax benefits that such status would have granted, provided that the activities of the company i) are deemed of economic interest by the free zone authority and ii) matches with the targeted industries of the free zone (click link for a list).
  2. Our Client registering a company in a Thailand special economic zone will also benefit from simpler registration procedures because:
    • Companies registered in a Thailand free zone can be wholly foreign-owned without the requirement to secure a foreign business license, allowing to minimize costs and timelines required to complete the engagement;
    • Most special economic zones also provide a one stop shop allowing to register the company, secure all necessary licenses and permits required to operate;
    • Last but not least, free zone companies can sponsor skilled foreign workers for employment permits through a fast track procedure.

Requirements to form a free zone company in Thailand

  • There are currently ten special economic zones located in the following cities/districts: i) Tak ii) Sa Kaew iii) Trat iv) Mukdahan v) Songkhla vi) Nong Khai vii) Narathiwat viii) Chiang Rai ix) Nakhon Phanom and x) Kanchanaburi. These SEZ are all located in border towns at the Malaysian, Cambodian, Laos and Myanmar borders, with good road and sea connectivity to China and G3 markets;
  • Each of these SEZs prioritizes some “target industries” and will review on a case by case investment projects by foreigners. As a rule of thumb, foreigners willing to register their company with one of these free zones will be required to i) pay up a capital of at least US$62,000 ii) secure a lease agreement for manufacturing or warehousing space within the free zone and iii) demonstrate their activities are export oriented and/or will generate technology transfers;
  • Because of the above, Healy Consultants’ preferred approach for this type of project is to prepare a high quality business plan to determine with the SEZ authority and multiple lawyers whether SEZ registration will be feasible for our Client’s projects. To proceed with the same, our Firm requests settlement of a retainer fee, thereafter offset from total engagement costs after we confirm the optimal SEZ for registration of our Client’s company.

Table of Comparison between most popular Thailand free zones

Table of Comparison between most popular Thailand free zonesNong KhaiKachanaburiTak SEZSa KaeoSongkhlaTratMukdahan
Our recommendation in order of preference3746152
Summary at a Glance
Special Economic Zone used mostly by which industry?Agriculture and textileAutomobileAgriculture & Light IndustryLight & Chemical IndustryManufacturingAgriculture, TourismAgriculture and Industrial Zones
Average annual Industrial space rent per 1000 sq. m.US$50,000US$77,000US$60,000US$62,000US$45,000US$62,000US$50,000
Exempt from corporation tax and VAT?YesYesYesYesYesYesYes
Our Client must travel?NoNoNoNoNoNoNo
How long to set the company Paid-up register capital requirement?up?US$62,000US$62,000US$62,000US$62,000US$62,000US$62,000US$62,000
Manufacturing allowed in the free zone?YesYesYesYesYesYesYes
Incorporation requirements
Branch or LLC recommended?LLCLLCLLCLLCLLCLLCLLC
Can be wholly foreign owned?YesYesYesYesYesYesYes
Resident representative or agent required?YesYesYesYesYesYesYes
How long to set the company up?10 weeks10 weeks10 weeks10 weeks10 weeks10 weeks10 weeks
Minimum number of directors?1111111
Minimum number of shareholders?3333333
Individual shareholders allowed?YesYesYesYesYesYesYes
Corporate shareholders allowed?YesYesYesYesYesYesYes
Corporate director(s) allowed?NoNoNoNoNoNoNo
Tax Identification Number required?YesYesYesYesYesYesYes
Minimum number of shareSpecial permit or license required?holders?NoNoNoNoNoNoNo
Tax and accounting considerations
VAT standard rate?0%0%0%0%0%0%0%
Corporate tax standard rate for initial 8 years?0%0%0%0%0%0%0%
Average customs tax on imports?0%0%0%0%0%0%0%
Annual audited financial statements?YesYesYesYesYesYesYes
Import duty on raw materials and inputs used in production of products0%0%0%0%0%0%0%
Double deduction from electricity, power supplies, and transportation bills?YesYesYesYesYesYesYes
Bank account characteristics
Corporate bank account?Kasikorn BankSCBTMBKrungthai BankBank of AyudhyaThanachart BankCIMB
Thai bank signatory requiredNoNoNoNoNoNoNo
How long to open company bank account?4 weeks4 weeks4 weeks4 weeks4 weeks4 weeks4 weeks
Do I travel to open the bank account?NoNoNoNoNoNoNo
Bank guarantee (USD)?US$154,273US$154,273US$154,273US$154,273US$154,273US$154,273US$154,273
Minimum deposit (USD)?US$1,500US$1,500US$1,500US$1,500US$1,500US$1,500US$1,500
Can open multicurrency bank account?YesYesYesYesYesYesYes
Corporate ATM card available?YesYesYesYesYesYesYes
Logistics considerations
Allowed to sign sales contracts with Thai Clients?YesYesYesYesYesYesYes
Allowed to invoice Thai Clients?YesYesYesYesYesYesYes
Allowed to import raw materials?YesYesYesYesYesYesYes
Allowed to export goods?YesYesYesYesYesYesYes
Quality of Utilities?Very GoodGoodGoodVery GoodVery GoodVery GoodVery Good
Physical office space required?YesYesYesYesYesYesYes
Can the entity hire expatriate staff in Thailand?YesYesYesYesYesYesYes
Permitted to employ foreign unskilled workers in the promoted projects?YesYesYesYesYesYesYes
Social contributions payable to employees?YesYesYesYesYesYesYes
How long to get work visa?1 month1 month1 month1 month1 month1 month1 month
Average Yearly SalaryUS$2,294US$3,104US$2,589US$1,769US$4,482US$4,334US$1,799
Proximity to international airport?56 km142 km285 km175 km43 km285 km19 km
Proximity to train network?6 km5 km174 km15 km1 km12 km170 km

Frequently asked questions

Contact us

For additional information on our free zones services in Thailand, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi
Thailand securities and exchange commission The Thai chamber of commerce and board of trade of Thailand Thailand department of foreign trade - Ministry of Commerce Thailand department of business development - Ministry of Commerce Thailand board of investment