Expanding a Thai business abroad is a good solution when a company has reached maturity. There are several ways of extending a Thailand-based company, among which the simplest are by creating a subsidiary or branch office in the desired destination. Out of the two structures which can be set up the subsidiary offers more advantages because it is more flexible.
The Thai company can open a subsidiary in Singapore, for example, which will grant the Singapore company the status of a resident business and thus obtain many tax benefits. However, there are also other advantages linked to extending a company through a subsidiary in another country.
Obtaining access to other markets through a subsidiary
One of the main reasons and advantages for expanding a Thai business is to gain access to other markets. Whether the company chooses a neighboring country or a Western state to enter, its market share will increase in accordance with the size of that country. If the company’s management decides to set up a subsidiary in Hong Kong, for instance, it will reach a not very large market, but a very wealthy one.
When it comes to a larger market size and similar tastes in products, the Thai business can obtain that by creating a subsidiary in Malaysia.
Tax benefits for subsidiaries in other countries
As mentioned earlier, subsidiaries are a great way of taking advantage of the local tax benefits which usually apply to resident companies. This is also available for subsidiary companies and it represents a great way for a Thai business to cut some of the costs related to expanding to another country.
This can be a good solution when expanding to an European country, for example, Ireland which is one of the best states in terms of taxation. If you wonder how to open a subsidiary in Ireland, the answer is quite simple: it can be set up in just a few days and based on a minimum number of documents.
Subsidiary companies can take various forms
Owners of both small and large companies can set up subsidiaries abroad. This is because the subsidiary can take various forms: from limited liability companies, to partnerships or joint venture, the subsidiary is very cost-efficient, which is very important for most business owners.
Subsidiaries are very common structures employed by small and large companies, which makes them safe types of companies which can be established in most countries of the world. Choosing the country of destination is subject to the types of customers the Thai business will address and its expansion needs, however, there are plenty of countries which can accommodate every need and requirement.