Dissolution and Liquidation

Stopping sales, closing an office, or having no business transactions does not automatically terminate a Thai company or registered partnership.

Until the entity has completed both dissolution registration and final liquidation registration, it may continue to have accounting, tax, social security, and regulatory filing obligations.

Leaving an inactive entity unattended can result in overdue financial statements, unfiled tax returns, penalties, government notices, and additional complications when the owners eventually decide to close it.

Taxpoint provides company dissolution and liquidation support covering corporate registration, closing accounts, tax coordination, and the documents required to complete the process properly.

Dissolution and final liquidation are different stages

Closing a Thai juristic entity involves two important legal stages:

• Dissolution registration: The entity stops conducting its ordinary business and enters the liquidation process.

• Final liquidation registration: This takes place after assets, receivables, debts, taxes, accounts, and remaining obligations have been settled.

After dissolution, the entity continues to exist for liquidation purposes. The liquidator acts on its behalf until final liquidation is registered with the Department of Business Development, or DBD.

Registering the dissolution alone therefore does not completely terminate the juristic entity.

Who may need this service?

The service is suitable for a business that:

• Has stopped operating and has no plan to restart

• Has had no transactions but remains registered as a juristic entity

• Wants to terminate its accounting and tax obligations correctly

• Needs to settle assets, debts, receivables, or remaining cash

• Needs to cancel VAT and employer registrations

• Wants to prevent future filing obligations and penalties

If the entity cannot pay its creditors, has liabilities exceeding its assets, is involved in litigation, or has a shareholder dispute, legal advice may be required before using the ordinary liquidation procedure.

Stage 1: Registering the dissolution

Limited company

A limited company must generally call a shareholders’ meeting by giving at least 14 days’ notice, or following the period specified in its articles of association.

A special resolution to dissolve the company requires at least three-fourths of the shares represented at the meeting. The meeting should also identify the liquidator, the liquidator’s authority, and the liquidator’s office.

Unless otherwise provided, the company’s directors may become liquidators by operation of law under the applicable rules.

Registered partnership

A registered partnership may be dissolved by agreement of the partners, an event specified in the partnership agreement, operation of law, or a court order.

The managing partners generally become liquidators unless another arrangement is properly approved.

Actions required within 14 days

The liquidator must generally:

• Apply to register the dissolution with the DBD

• Publish the dissolution notice in a local newspaper at least once

• Send registered notices to known creditors

• Prepare Forms Lor Chor 1 and Lor Chor 2

• Retain publication and creditor-notification evidence

Stage 2: Conducting the liquidation

The liquidator is responsible for settling the entity’s remaining affairs. The work may include:

• Verifying cash and bank balances

• Collecting receivables

• Selling or disposing of assets where necessary

• Reviewing and paying creditors

• Cancelling contracts and ongoing services

• Paying liquidation expenses

• Closing bank accounts after all transactions are complete

• Distributing the remaining capital or property after all liabilities have been settled

Remaining assets should not be distributed to shareholders or partners before creditors, taxes, and liquidation expenses have been properly addressed.

Closing accounts and financial statements

The entity must prepare financial statements as of the dissolution date, or the date accepted by the registrar under the applicable procedure, and submit them for examination by a certified public accountant.

Important balances include:

• Cash and bank accounts

• Receivables and payables

• Inventory

• Land, buildings, equipment, and other assets

• Director or shareholder loans

• Outstanding and refundable taxes

• Deposits and continuing contracts

• Capital and retained earnings

Even where there have been no transactions during the closing period, the accountant must confirm whether any assets, liabilities, loans, or taxes remain on the books.

Tax obligations after dissolution

DBD dissolution registration does not automatically terminate the entity’s tax obligations.

Corporate income tax

The liquidator should:

• Notify the Revenue Department within the applicable period

• Treat the registrar’s dissolution-acceptance date as the final date of the accounting period under the relevant tax rules

• Prepare and file the final P.N.D. 50 corporate income tax return within 150 days

• Review the tax treatment and valuation of remaining assets

• Settle outstanding taxes, surcharges, or penalties where applicable

Value-added tax

A VAT-registered entity must file Form Por.Por.09 to notify the cessation of its VAT business within the prescribed 15-day period.

VAT filing obligations may continue until the Revenue Department removes the entity from the VAT register. The entity should not stop filing Por.Por.30 returns solely because the DBD dissolution has been registered.

Other taxes during liquidation

Payments for rent, services, wages, or asset disposals during liquidation may continue to create withholding-tax, VAT, documentation, and filing obligations.

Before final liquidation registration, the entity must coordinate the tax review process and obtain the Revenue Department’s accounting-audit certification required by the DBD.

Employees and social security

Dissolving a company does not automatically terminate employment contracts or employee rights. The employer should:

• Notify employees in accordance with labour law and their employment terms

• Calculate final wages, statutory severance, notice payments, and other applicable entitlements

• Report the end of each employee’s insured status using Form SSO 6-09 by the 15th day of the following month

• Submit the final monthly social security contributions

• Contact the Social Security Office to update or close the employer’s status

• Review any outstanding Workmen’s Compensation Fund obligations

What happens if liquidation takes longer?

If liquidation is not completed within three months from the dissolution date, the liquidator must file Liquidation Report Form Lor Chor 3 every three months until completion.

If the liquidation remains incomplete after one year, the liquidator must call an annual meeting and report the actions taken and the detailed progress of the liquidation.

An entity with assets, debts, tax issues, missing records, or unresolved contracts may therefore require substantially more time than a dormant entity with no remaining balances.

Stage 3: Registering completion of the liquidation

After collecting receivables, settling creditors, completing the tax work, and preparing the closing financial statements, the liquidator prepares the final liquidation report.

The remaining steps generally include:

1. Calling a shareholders’ or partners’ meeting under the applicable rules

2. Obtaining approval of the final liquidation report

3. Preparing Forms Lor Chor 1, Lor Chor 3, Lor Chor 5, and Lor Chor 6

4. Attaching the closing financial statements and Revenue Department certification

5. Registering completion of the liquidation within 14 days after the meeting’s approval

The closure becomes complete after the DBD accepts the final liquidation registration.

Documents generally required

• Current company or partnership registration documents

• Articles of association and shareholder information

• Identification documents of directors, managing partners, and liquidators

• Latest financial statements and accounting records

• Trial balance and general ledger

• Bank statements

• Asset, inventory, receivable, and payable schedules

• Tax returns and tax-payment receipts

• VAT registration documents

• Employee and social security information

• Leases, service agreements, and other continuing obligations

• A power of attorney where another person handles the filing

Taxpoint’s service scope

• Review of the entity’s status and readiness for dissolution

• Advice on resolutions, liquidators, and supporting documents

• Preparation and follow-up of the DBD dissolution filing

• Guidance on the publication and creditor-notification process

• Review of accounting balances and outstanding items

• Preparation of closing-period financial statements within the agreed scope

• Coordination with the auditor and tax process

• Guidance on VAT, social security, and related cancellations

• Preparation of the final liquidation-registration documents

Service fee

The service fee starts from THB 15,000 where the dissolution-period accounts contain no business transactions.

The final fee depends on document readiness, transaction volume, assets, liabilities, outstanding taxes, employee matters, and the time required to complete the process.

The quotation should clearly state whether government fees, publication costs, audit fees, and other expenses are included.

Close the business properly and prevent future problems

Closing a company can be more complicated than incorporating one because corporate registration, accounting, tax, creditors, and employees must all be handled in the correct sequence.

Taxpoint can help review the entity’s status, plan the work, and coordinate the company dissolution and liquidation process from the initial filing through final registration.

Contact us for a free initial consultation before proceeding.