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Taxes in Thailand

Taxes in Thailand

The taxation system in Thailand is mainly regulated by the Thai Revenue Code, which governs the corporate income tax, the VAT, the Specific Business Tax and the stamp duty. Customs taxes are governed by the Customs Act. The excise taxation is regulated by the Excise Act and the petroleum income tax is governed by the Petroleum Income Tax Act.

Taxes in Thailand are under the administration of the Revenue Section, the Customs Section and the Excise Section.

Main taxes for corporations presented by our company registration experts in Thailand

The main taxes for corporations in Thailand are as listed below:

•    Corporate income tax rate: 20%;
•    Income tax rate for petroleum businesses: 50%;
•    Income tax rate for branch corporations: 20%;
•    Capital gains taxation: 20% (standard)/15% (recipients from abroad);
•    Basis: Worldwide;
•    Participation exemption: Not applicable.

Withholding taxation in Thailand

The withholding taxes in Thailand for corporations are as follows:

•    Dividends: 10%;
•    Interest: 0%/1%/10%/15%;
•    Royalties: 3%/15%;
•    Branch remittance tax: 10%;
•    Capital tax: not applicable;
•    Social security tax contributions: 5% of the monthly salary;
•    Real estate tax: 12.5%;
•    Local development taxation: 0.25%/-0.95%;
•    Specific business taxation: 3.3% (including the municipal taxation of 10%);
•    Stamp duty: 0.1% or as stated in the Revenue Code;
•    VAT: 0%/7% (in 2015). Our Thai company formation professionals can provide more details on VAT in Thailand.

Deductions in Thailand

The vast majority of expenses connected with gaining income are deductible in Thailand, containing: 

•    Interest, with the exception of interest paid on capital, reserves or nondeductible funds;
•    Reasonable and justifiable management remunerations charged at market value;
•    Losses;
•    Depreciation;
•    Taxes in Thailand, with the exception of corporate income tax and VAT, waged to the government;
•    Bad debts, if there is proof or reasonable efforts to collect the debt according to the Thai Revenue Code regulations;
•    Contributions of employers to the provident fund;
•    Donations up to certain limits;
•   Entertainment expenses, up to 0.3% of gross revenue or paid-up capital (the one which is higher), subject to the nature of the business and if the expenditure is essential and not greater than THB 10 million.

Our company registration specialists in Thailand can give you more details about these deductions.

Taxes for individuals in Thailand

A private person who resides in Thailand for minimum 180 days in a calendar year is considered to be a resident of Thailand and has to pay taxes. The taxes for individuals in Thailand are as follows:

•    Income tax: 0% – 35%;
•    Capital gain tax: 0% – 35%;
•    Double taxation relief: applicable;
•    Dividends: 10%;
•    Interest: 15%;
•    Royalties: progressive for residents, 15% for nonresidents;
•    Social security tax: 5% of the salary;
•    Real estate taxation: 12.5%;
•    VAT: 0%/7%.

Please get in touch with our company formation consultants in Thailand if you need further information on the tax regimen in this country.