Forvis Mazars highlights holding companies as key tools for family business to survive

Parin Supsavaipol, tax director of Forvis Mazars (Thailand), said although not a legally defined term in Thailand, a holding company is a powerful legal structure used to centralize control, protect core assets, and streamline the transfer of ownership within family enterprises. By consolidating investments and decision-making under a single entity, families can better manage complex ownership and reduce internal conflicts.

He said that a well-structured holding company can help separate high-risk business operations from valuable assets such as land or intellectual property. This "ring-fencing" approach limits liability exposure and ensures business continuity.

Tax-wise, dividends paid from subsidiaries to the holding company can qualify for tax exemptions under certain conditions. In exit scenarios, the sale of business shares through a holding company may result in significantly lower tax rates when compared to personal ownership.

The firm also points out that families with multiple investments in Thailand and abroad may benefit from evaluating the International Business Centre (IBC) incentive, which offers reduced corporate income tax rates and flat personal income tax rates for expatriates.

While some families consider offshore holding companies in jurisdictions like Singapore or Hong Kong, Forvis Mazars cautions that such structures are not always advantageous and may lead to higher compliance costs. A case-by-case analysis is essential.

"Forvis Mazars understands that every family business is unique. The decision to set up a holding company should be based on a detailed legal and tax review tailored to each family's needs," said the firm. "We are committed to supporting families in building sustainable, efficient structures that preserve both their wealth and values across generations."

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