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Dissolution and Liquidation

Dissolution and Liquidation in Thailand: Let AO guide you through this difficult process.

Making the decision to dissolve and liquidate a company is never an easy one. Whether it’s due to financial difficulties, market fluctuations, or a strategic in business decision, closing a business in Thailand comes with its own legal and financial challenges. Below is a detailed outline of the process, along with important considerations for any company or business owner facing this difficult decision.


two senior Accountants generating financial report for companies dissolution and liquidation in Thailand


Why Close a Company?

A company may need to be closed for various reasons:

  • Financial insolvency
  • Unfavorable market conditions
  • A shift in shareholders’ investment focus
  • Business exit strategy

Regardless of the reason, it’s crucial to follow the lawful procedures outlined by the Thai government to avoid financial, tax and legal complications.


Understanding the Terms:

  • Dissolution: The formal process of closing down a company, beginning with a shareholders’ resolution.
  • Liquidation: The procedure of settling the company’s debts, liquidating assets, and distributing any remaining funds to the shareholders.
  • Tax Examination/Audit: Upon registration for Dissolution and Liquidation process the Thai Revenue Department (TRD) is obligated to perform a formal review of the company’s tax position to determine whether any taxes are currently due or should be assessed before the company is cleared for cancellation of their VAT Certificate, final distribution of any remaining funds to the shareholders.
  • Final Clearance: Received from the TRD at the conclusion of the Tax Examination/Audit, which allows for   the final Disbursement to Shareholders and register the liquidation to officially cancel the company.

Steps for Closing a Thai Company

Preparing for Dissolution

The first step, which is often overlooked, is cleaning up your company’s balance sheet and financial affairs before registering for dissolution. A messy balance sheet can lead to significant risk of uncontrollable/costly legal and tax exposures for the company. Since after the registration for Dissolution has been executed, the company is required to cease all business operations, it is strongly advisable to first clear all inventory off the books and as much as possible to settle all assets and liabilities in advance of your shareholders’ resolution to dissolve. 

Furthermore, a messy balance sheet can result in legal complications when settling the company’s debts, liquidating assets and can significantly lengthen the time/expense of completing the tax examination/audit procedures to the satisfaction of the TRD.  The tax examination/audit is by far the most challenging and time-consuming process in a company’s dissolution and liquidation.  Even a clean balance sheet can expect tax examination/audit to take as long as 1 year to conclude. While a messy balance sheet can typically take 2 years or more to complete.

Only after your balance sheet is as clean as possible should your company then hold a shareholders’ meeting to pass a special resolution for dissolution. At least 75% of shareholders must vote in favor. Announcements about the meeting should be published in a local newspaper and sent to stakeholders at least 14 days before the meeting.

Filing with the Ministry of Commerce

Once the shareholders’ resolution is passed to dissolve the company, you must file an application with the Department of Business Development (DBD) at the Ministry of Commerce. This involves notifying creditors and submitting a closing financial statement audit.

Liquidation of Assets

Clear all outstanding debts and distribute remaining assets among shareholders according to their shareholding ratio.

Financial and Tax Responsibilities

If your company is VAT-registered, you’ll need to dissolve this registration with the TRD to which the TRD will not cancel and return your VAT certificate until their tax examination/audit procedures have been completely satisfied. Any work permits and visas for foreign employees must also be canceled, and special government licenses should be returned. Also, timely reporting of Liquidator Reports on a quarterly basis to the DBD is crucial until the company is officially wound down.

Finalizing the Process

Upon receiving Final Clearance from the TRD, the last steps are to distribute any remaining funds to the shareholders and register the liquidation with the DBD.


Important Considerations

  • Legal Assistance: Due to the complex paperwork involved, it’s advised to consult legal professionals for a smooth process.
  • Timeframe: The registration for the Dissolution and Liquidation process can take between 45 to 90 days for a reasonably clean balance sheet and significantly longer for a messy one, depending on various factors such as financial complexity and the availability of corporate shareholders. The Tax Examination/Audit can range from less than 1 year to over 2 years, depending upon the above-mentioned balance sheet and other factors.
Learn More About: Dissolution and Liquidation

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John Casella

Chief Executive Officer

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John has more than 30 years of professional experience in accounting and business consulting for a wide range of companies and projects in South-East Asia and North America. He holds active licenses as both a Certified Public Accountant in the USA and a Chartered Professional Accountant in Canada. 


John joined AO in 2022, after building up a strong team at PKF and Baker Tilly where he was in charge of the accounting, tax advisory and corporate legal teams, as well as provision of integrated services to accounting and payroll clients. John first started working in Thailand in 1997 and spent 10 years in corporate advisory services. He began his career based in Canada as a financial auditor for Arthur Andersen.

The Most Frequent Questions

To dissolve a company in Thailand, start by holding a shareholders' meeting to pass a special resolution for dissolution, which needs at least a 75% approval. Following this, submit an application with the Ministry of Commerce.

Dissolution is the formal act of closing down a company, while liquidation refers to the process of settling the company’s financial obligations.

The best way involves closely following the legal procedures laid out by the Thai government, preferably with the assistance of legal professionals.

If you have more questions?

The cost can vary widely depending on the complexity of the company’s finances and whether legal help is enlisted. Always consult a financial advisor for a detailed estimate.

The shareholders are responsible for making the decision to dissolve a company. At least 75% must agree to the dissolution for the process to begin.

In most cases, yes. Dissolution usually precedes the liquidation process, which involves settling the company's debts and dividing remaining assets.

When it comes to financial compliance and transparency, the importance of audit liaison and statutory accounts cannot be overstated. These elements are particularly crucial in Thailand, where financial regulations are subject to frequent changes and updates.

office staff Collaboratively Working of annual year-end audit liaison statutory accounts


The Importance of Statutory Accounts

Every company in Thailand, regardless of their size, is required to produce annual year-end statutory accounts also known as (annual accounts), which must be audited at the end of each fiscal year for submission to both the MOC and the TRD. These include the balance sheet, profit and loss statement, and notes to the accounts, among other elements, with year-end statutory net income serving as the starting point for your corporate tax filing.

While their primary function is to satisfy legal requirements, they also serve as an invaluable tool for stakeholders—ranging from company directors to potential investors—to understand the financial health of the business. In Thailand, statutory accounts are not just a regulatory mandate but are often scrutinized by banks, financial institutions, and even potential business partners.

Statutory Audits: The Thai Context

In Thailand, a statutory audit is more than a formality; it is a comprehensive evaluation of a company’s financial statements by an external auditor. This is required by Thai law for every business, even non-profit, rep offices, holding companies and dormant companies, including limited companies and public limited companies.

Key Components Involved in Audit Liaison

AO audit liaison services act as a bridge between the company and the external auditors. Given the complexity of the regulatory landscape, businesses need an expert to guide them through the audit process. Key tasks involved in this role may include:

  • Coordinating with external auditors
  • Clarifying audit requirements
  • Ensuring preparedness for the audit
  • Handling queries during the audit process
  • Reviewing audit findings and advising on corrective actions

Tailored Requirements for Different Business Types

Different types of businesses have varied regulatory requirements, including those for audits and statutory accounts. Understanding these nuances is crucial for compliance and for leveraging your financial statements as a business tool.

International Standards with Local Relevance

In Thailand, while international accounting and auditing standards such as the International Financial Reporting Standards (IFRS) are recognized, local adaptations and interpretations often apply. Businesses need to be aware of these local nuances to ensure that they are in full compliance with Thai laws while also meeting international standards.

Understanding audit liaison and statutory accounts, especially within the complex regulatory framework of Thailand, is essential for any business aiming for both compliance and operational excellence.


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