Accounting & Taxes

Yes. Thailand offers several incentives specifically targeted at SMEs: progressive CIT rates (0% on first THB 300K of net profit, 15% on THB 300K–3M) for companies with paid-up capital up to THB 5 million and annual revenue up to THB 30 million; enhanced deductions — certain qualifying expenses can be deducted at 150–200% of actual cost (including R&D expenditure, employee training, and investments in approved technology); accelerated depreciation for qualifying assets; and BOI promotion, which provides tax holidays, import duty exemptions, and foreign ownership benefits for eligible business activities. For island-based businesses, the key is understanding which incentives apply to your specific activity and ensuring you meet the qualifying conditions — which we handle as part of our tax planning service.

No — statutory accounts must be in Thai. Under the Accounting Act, all primary accounting records, financial statements, and supporting documents must be maintained in Thai (or in Thai with a certified translation). However, this does not prevent you from maintaining parallel management accounts in English for internal decision-making, group reporting, or investor communications. We prepare all statutory records in Thai to meet legal requirements, while providing monthly management reports, financial summaries, and tax correspondence in English. For companies with international reporting obligations, we can prepare accounts under full IFRS alongside the Thai statutory accounts. All accounting must use Thai Baht as the presentation currency under TFRS for NPAEs, though entities under full TFRS may have more flexibility for functional currency.

Yes, if you have a tax obligation in Thailand. Every individual who earns taxable income in Thailand — whether from employment, business, rental income, or remitted foreign income — must obtain a Tax Identification Number (TIN) from the Revenue Department. For companies, a TIN is issued automatically upon registration with the DBD. For individuals, you must apply at the local Revenue Department office with your passport, work permit (if applicable), and Thai address. The TIN is required on all tax returns, withholding tax certificates, and official correspondence with the Revenue Department. We assist with TIN applications for both companies and individuals as part of our onboarding process.

It depends on your residency status and income sources. If you are present in Thailand for 180 days or more in a calendar year, you are a Thai tax resident and must file a personal income tax return declaring: all Thai-sourced income (salary, business profits, rental income, investment returns), and — since 2024 — any foreign-sourced income remitted to Thailand. If you spend fewer than 180 days in Thailand, you are generally taxed only on Thai-sourced income. Even if you have no tax liability, filing a nil return is advisable to establish a clean compliance record. Penalties for non-filing include a THB 2,000 fine and 1.5% monthly interest on any unpaid tax. Thai tax residency is determined on a calendar-year basis — each year is assessed independently.

Yes. Unlike many jurisdictions that exempt small companies from audit requirements, Thai law requires every limited company — regardless of its size, revenue, or number of employees — to have its annual financial statements audited by a licensed Certified Public Accountant (CPA). There are no exemptions. The CPA must be registered with the Federation of Accounting Professions (FAP) and cannot be a director, employee, or shareholder of the company being audited. The audited financial statements must be approved at the AGM and filed with the DBD within the statutory deadlines. Companies that fail to file face fines of up to THB 50,000 and, for directors, potential criminal liability. We coordinate the audit process with our network of licensed CPAs to ensure a smooth, timely, and cost-effective annual cycle.

Thailand has signed 61 Double Taxation Agreements (DTAs) with countries worldwide, including the UK, US, Germany, France, Australia, Japan, Singapore, and most EU and ASEAN nations. DTAs serve three key purposes: they allocate taxing rights between countries (determining which country can tax specific types of income); they reduce withholding tax rates on cross-border payments (dividends, interest, royalties often benefit from reduced rates under DTAs compared to domestic rates); and they provide a foreign tax credit mechanism — tax paid in one country can be credited against the tax liability in the other, preventing the same income from being taxed twice. For expats with foreign income now subject to Thai tax under the 2024 rules, DTAs are an essential planning tool. We analyse your specific DTA position and ensure all available credits and exemptions are claimed correctly.

From 1 January 2024, Thai tax residents who remit foreign-sourced income earned on or after that date into Thailand are subject to personal income tax at progressive rates (0–35%), regardless of when the remittance occurs. Previously, income could be remitted tax-free if transferred in a different calendar year from when it was earned — that loophole is now closed. Income earned before 2024 remains exempt from Thai tax even if remitted after 2024. A proposed Royal Decree would introduce a two-year grace period allowing foreign income remitted within the year earned or the following year to be exempt — but this has not yet been enacted and remains a proposal. In the meantime, careful planning around remittance timing, DTA credits, and segregation of pre- and post-2024 funds is essential.

Rental income from Thai property is Thai-sourced income and is taxable regardless of the owner's residency status. For non-residents (fewer than 180 days in Thailand), the tenant must withhold 15% of the gross monthly rent and remit it to the Revenue Department — this satisfies the owner's tax obligation. For tax residents receiving rent from a Thai company tenant, 5% withholding tax applies as a credit against the owner's annual PIT liability. Rental income must be reported on the annual PIT return and is subject to progressive rates after applicable deductions. Property owners can deduct actual expenses or opt for a standard deduction of 10–30% of gross rental income (depending on property type). Annual Land and Building Tax is also payable: 0.02–0.10% of appraised value for residential properties, with higher rates for commercial and vacant land.

The standard CIT rate is 20% on net profits for companies incorporated in Thailand. SME progressive rates apply to companies with paid-up capital not exceeding THB 5 million and annual revenue not exceeding THB 30 million: 0% on the first THB 300,000 of net profit, and 15% on profits between THB 300,001 and THB 3 million. Profits above THB 3 million are taxed at the standard 20%. BOI-promoted companies may receive corporate tax exemptions for up to 8 years (extendable to 13 years for certain priority activities), plus 50% reductions for additional years. Companies incorporated outside Thailand with a branch or permanent establishment are taxed only on Thai-sourced income at the same 20% rate. From 2025, Thailand has implemented the 15% global minimum tax (OECD Pillar Two) for large multinational groups with revenue above EUR 750 million.

Thailand treats tax evasion seriously, with both administrative and criminal consequences. Administrative penalties include: surcharges of 1.5% per month on unpaid tax (up to the full amount of the tax owed); penalty fines of up to twice the tax amount for VAT offences; and assessment adjustments with additional tax, surcharges, and fines for underreporting. Criminal penalties include: fines of up to THB 200,000 and imprisonment of up to one year for intentional failure to file or fraudulent filing; fines of up to THB 2,000 for technical filing violations. The Revenue Department can audit records going back 10 years for suspected evasion (versus the standard 5-year period). With Thailand's participation in the CRS and increasingly sophisticated data-matching capabilities, the risk of detection for offshore income non-reporting has increased substantially.

Thai tax law provides a range of deductions and allowances for individuals: personal allowance of THB 60,000; spouse allowance of THB 60,000 (if the spouse has no income); child allowance of THB 30,000 per child (THB 60,000 for second child onwards born from 2018); life insurance premiums up to THB 100,000; health insurance premiums up to THB 25,000; provident fund contributions up to THB 500,000; Super Savings Fund (SSF) and Retirement Mutual Fund (RMF) contributions (combined cap of THB 500,000 with provident fund); home mortgage interest up to THB 100,000; and Social Security contributions up to THB 9,000. For expats with cross-border income, a foreign tax credit is available under Thailand's DTAs — you can offset tax paid overseas against your Thai PIT liability, subject to the lesser of the two amounts.

Penalties are automatic and cumulative: late filing surcharge of 1.5% per month on the outstanding tax amount (compounding monthly); late filing fine of THB 1,000–2,000 per return; for VAT, an additional penalty of twice the outstanding tax amount may be imposed for failure to file; for deliberate evasion, criminal penalties include fines of up to THB 200,000 and imprisonment of up to one year. The Revenue Department can audit up to 5 years of prior returns, or 10 years if evasion is suspected. Under the CRS, Thai authorities now receive automatic reports on overseas financial accounts from over 120 jurisdictions — making it increasingly difficult to underreport foreign income. The cost of remediation always exceeds the cost of timely compliance. We manage all deadlines proactively, with built-in review cycles that ensure nothing is missed.

They are mutually exclusive — a transaction is subject to either SBT or VAT, never both. VAT (7%) applies to most sales of goods and services and is the standard indirect tax for commercial businesses. Specific Business Tax (SBT) applies to specific categories of business activity that are exempt from VAT: banking and finance (3.3%), life insurance (2.75%), pawnshops (2.75%), and — most relevant for foreign property owners — the sale of immovable property (3.3%) when the seller has held the property for less than 5 years or the sale is deemed commercial in nature. The SBT rate is the headline rate plus a 10% municipal surcharge (e.g., 3.0% + 0.3% = 3.3% for property sales). For companies selling property, SBT almost always applies. Understanding which tax applies is critical for accurate pricing and cost projections.

Withholding tax (WHT) is a mechanism where the payer deducts tax from payments made to suppliers, contractors, and service providers and remits it directly to the Revenue Department. It is essentially a prepayment of the recipient's income tax. Common rates include: 1% for transport and advertising; 2% for service fees paid to companies; 3% for professional fees (accounting, legal, engineering); 5% for rent payments; and 15% for royalties, interest, and dividends paid to non-residents (subject to DTA reductions). WHT must be remitted by the 7th of the following month, with corresponding withholding tax certificates issued to the recipient. If your company fails to withhold, it becomes liable for the full tax amount plus surcharges. We calculate and manage all WHT obligations as part of our monthly compliance service.

VAT registration is mandatory once your business's annual revenue from the sale of goods or services exceeds THB 1.8 million. You can also register voluntarily before reaching this threshold — which may be advantageous if your business incurs significant input VAT (on purchases, rent, services) that you want to reclaim. The current VAT rate is 7% (temporarily reduced from the statutory 10%). Once registered, you must: charge 7% VAT on all taxable sales, issue tax invoices that meet strict formatting requirements (seller/buyer details, tax ID numbers, item descriptions, VAT amount), file monthly VAT returns (Form PP 30) by the 15th of the following month, and maintain a VAT ledger. Failing to register when required can result in penalties of 1.5% per month on the unpaid VAT, plus surcharges.