Tests of doing business and penalties for unregistered entities considered as doing business in Thailand

1) What is considered doing business without registration?

Depending on status (Thai or foreign) and nature of unregistered activity, it means operating any commercial activity without officially registering with or obtaining required license from the relevant authorities regulating those activities and/or persons’ status.

2) What are the key indicators of doing business?

Depending on criteria of particular legislations, generally, the key indicators shall include whether such engaged activities (selling goods or provision of services) are being engaged regularly and whether they are intended to generate income/profits.

3) What are the legal consequences of doing business without registration?

Depending on each legislation governing such matter, doing business without registration would be subject to criminal offences e.g. fines and imprisonment. 

In addition, in most legislation, if the person violating such particular legislation is a juristic person, directors of such an entity shall also be subject to the same penalties.

4) What is the penalty amount in 2025?

The penalties imposed shall depend on particular legislation being violated. For example, operating business without registering under Commercial Registration Act B.E. 2499 (1956) would be subject to fine up to THB 2,000, and if continuing the offence an additional fine up to THB 100 per day until compliance. 

In case of foreigners, operating business without a Foreign Business License shall be subject to fine from THB 100,000 – 1,000,000 or imprisonment up to 3 years and daily fines of THB 10,000 – 50,000 if continuing the violation.

Or if annual income of business reaches THB 1.8 million and VAT has not yet registered, fines up to THB 5,000 and potential back payment of VAT and surcharges and interest on unpaid amounts may be imposed.

5) Is criminal liability possible?

Yes. In most cases, non-registered/non-compliance would be subject to criminal offences e.g. fines or imprisonment.

6) Who identifies unregistered business activity?

Regulator empowered under each particular legislation.

7) What should be done if the activity is already ongoing without registration?

Legally, all unregistered activities should be suspended temporarily to prevent further violation and the business operator should regularize its business immediately. If the penalties have already been imposed, they should be settled before applying for registration.

8) What obligations arise after registering a business?

The obligations vary depending on each particular legislation e.g. annual or monthly filing, notification of any changes etc.  The obligations in each legislation regulating your business must be observed and complied with.

9) From what income level must an individual register as an entrepreneur?

In terms of VAT, when the annual income of a business reaches THB 1.8 million.

Author: Chotika Lurponglukana