Index of legal movement in relation to business
The draft of Act on Establishment of Company by one person
Department of Business Development, Ministry of Commerce offered “the draft of Act on Establishment of company by one person B.E. …….. and approved by Council of Ministry on 24 January B.E.2560 (2017). At the moment, this Act is entering into consideration of Office of the Council of State and in the future this Act shall be considered by the National Legislative Assembly.
The Objective of the draft Act is that the investment of a company established shall be more convenient, the business shall be more simple and Small and Medium Enterprises (SME) shall be accessed to justice-person registration system of the government. The essence of this draft of Act includes;
- One person can make establishment of company called “the company ………… limited (one person)” and the company is a justice person under the Civil and Commercial Code.
- One person have Thai nationality can establish only one limited company and the owner of the company must take liability in the amount equal to the capital brought into the company. In addition, the capital shall be fully paid. This draft of Act does not allow only one foreigner to establish a limited company.
- In management, the owner can appoint himself or other person acting as the director in management. In addition, the Office of the Council of State shall add more details about management control and foreign takeovers so as to prevent Thai national from holding shares for the foreigner.
- The draft of Act on establishment of a company by one person provide rules and conditions on list of establishment of company by one person, such as dividend payment, capital increase, capital decrease, liquidation and repealing unoccupied company’s registration which are specific matters and reflect the characteristics of a limited company by one person. So, there rules and conditions are more flexible than a limited company under the Civil and Commercial Code.
- The company under the draft of Act on establishment of company by one person can transform for a limited company after the company procure elements in compliance with rules and conditions of establishment of limited company, such as the numbers of incorporators.
- The draft of Act on establishment of a company by one person has punishment and official fee for the company specifically.
The mutual connection of database on financial statement and filing personal income tax
On 6 March B.E.2561 (2018), Revenue Department (RD) and Department of Business Development (DBD) signed on Memorandum of Understanding regarding receiving and filing financial statement from DBD to RD for a business person submitting electronic financial statement (DBD e-Filing) of Department of Business Development and filing personal income tax by electronic (e-filing) of Revenue Department. The purpose is to reduce burdens of the business person in filing financial statement to both departments, to raise the level of difficulty- case in domestic businesses under Ease of Doing Business of World Bank and to enhance cooperation and service of government sectors.
Previously, the business person can file financial statement in 2 methods, i.e., filing financial statement by electronic (e-filing) and filing financial statement at Branch Area Revenue Office. After the Memorandum of Understanding is effective, the business person can file financial statement by electronic of Department of Business Development (DBD e-Filing) on the other method. As a result, the business person can get convenient in filling financial statement for 3 methods.
The deduction of remuneration of foreign employee for paying expenses on their own responsibility
The draft of Emergency Decree on Alien’s Working Management (No……) B.E………was approved by Council of the Ministry on July B.E2560 (2017) and considered by the Office of the Council of State on January B.E.2561 (2018) and this Act shall be published in Government Gazette soon. The draft of Emergency Decree on Alien’s Working Management was amended in several provisions, including important provision in Section 49 about the right of the deduction of remuneration of foreign employee for paying expenses on their own responsibility.
By the principles of law under the Labor Protection Act in Section 76(1), the employer shall not make any deductions from wage of an employee unless the deductions made for other payment provided by law. In addition, Emergency Decree on Alien’s Working Management (Previously) in Section 49 states that the employer shall not request or accept for money or property from a foreign employee for work. However, this Emergency Decree amendment in Section 49 adds exception that the employer shall make the deductions from foreign employee under the condition as follows:-
- The employer shall deduct expenses in foreign employee’s responsibilities, which are prepaid by the employers, namely, passport fee, health check-up fee, work permit fee or other expenses relevant to the matters as prescribed by the Director of Ministry of Labor.
- The employer can deduct wages, overtime pay, holiday pay and holiday overtime pay from foreign employee, under the rate which the employer actually paid.
- The employer must deduct the remuneration no more than 10 % of foreign employee‘s remuneration which he is entitled to receive in each month.
- Unless there are agreement made otherwise (such as no agreements on the employer paying all expenses for foreign employees), when the employer has prepaid traveling expenses, there shall deduct the traveling expenses from foreign employee‘s income he is entitled to receive in each month.
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