Thai Tax Laws FAQ
Who is required to pay corporate income tax?
Companies and partnerships established under Thai laws are subject to income tax on income earned from within and outside of Thailand. Companies and partnerships required to pay income tax include, but are not limited to:
Registered ordinary and limited liability partnerships.
Foundations and associations.
A branch of a foreign corporation earning from sources within Thailand.
How does corporate income tax work?
Corporate Income Tax is imposed on the net profits as per the generally accepted accounting principles and according to the conditions described in the Revenue Code of Thailand. The tax rate is currently 20% on taxable profits, however progressive rates up to 20% are granted to SMEs. Key rules and regulations to pay particular attention to include:
Every return must be accompanied by an audited financial statement and must be submitted within 150 days from the closing date of their accounting period.
50% of the estimated annual income tax must be paid by the end of the eighth month.
Failure to pay the estimated tax will result in a fine to the amount of 20% of the deficit.
How does personal income tax work?
Thai residents and non-residents are taxed on their Thailand-sourced income. A resident is any person residing in Thailand for 180 days or more in a calendar tax year. Assessable income is subject to progressive tax rates, up to the maximum rate of 35%. The taxpayer is liable to file a personal income tax return and make a payment to the Revenue Department within the last day of March following the taxable year.
How does VAT work?
Value added tax (VAT) registration is required for all businesses that reach a sales volume of THB 1.8 million. Currently, the rate is 7%, which is reduced from the nominal rate of 10%. VAT returns must be filed and paid within 15 days of the following month.
How does withholding tax work?
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