Taxation of Holding Companies in Thailand

A holding company in Thailand is one that is created for the purpose of acquiring and owning the shares in other business entities, thus allowing for a certain degree of control. Investors who start this type of business will need to observe the Thai company formation rules.

The taxation of holding companies in Thailand is subject to a set of rules and regulations. Our team of agents can help investors start a holding company and observe the updated requirements.

Special considerations for the taxation of Thai holding companies

The holding company regime in Thailand is generally attractive to investors. A special Degree establishes the manner in which dividends paid by a foreign company to a Thai recipient are taxed or, more specifically, exempt from corporate income tax.

The main issues that are relevant in the holding company regime are the following:

• Dividend taxation exemption: the dividends received by a Thai company are not taxed if that Thai registered company holds at least 25% of the shares in the company making the payments for at least six months before this payment is made and if the dividends are already subject to a tax rate of 15% in the foreign country where the company making the payment is a resident.
• Foreign capital gains: the sale of shares can be subject to a tax exemption in Thailand when a Thai company holds shares in a non-resident company that in turn holds shares in another non-Thai company and there is a sale of shares between these entities.
• The taxation of inbound dividends: a Thai company can be subject to an exemption from the corporate income tax when the dividends are remitted from a foreign company to a Thai company.
• The DTAs: Thailand has concluded more than 60 double tax treaties with other countries, allowing for a sound approach on the taxation of dividends or capital gains.

Holding companies are subject to the same registration and compliance requirements as other businesses incorporated in Thailand. Understanding the full scope of the tax and reporting regulations is useful for foreign investors who set up a holding form in the country. Our accountants in Thailand provide bookkeeping solutions, as well services for handling payroll and the payment of other taxes.

Holding companies in Thailand

Investors willing to open a company in Thailand that will later be used as a holding company can request our services. We can help entrepreneurs incorporate the business and set it up as per the business needs.

The fact that the country has a broad double taxation network makes it a viable location to base a holding company.

Investors who wish to know more about the taxation regime and the conditions for setting up a holding company can contact our team of Thailand company formation agents.