Today we got a question about making payment to a Singapore company from Thailand. The invoice is for research services rendered in Singapore for use in Thailand. For this we look into the double taxation treaty between Thailand and Singapore. The vendor does not have a permanent establishment in Thailand, so in this case Singapore, not Thailand, should get the tax from the business profits. Therefore when the Thai company makes payment to the Singaporean company, it does not have to withhold tax to submit to the Thai Revenue Department.
The next thing to really consider is whether the Thai company has to submit VAT on behalf of the Singaporean company. Since the research services were rendered in Singapore and the result of the work was to be used in Thailand, VAT must be submitted with Form PP36 by the 7th of the month following the payment. If the Thai company is VAT registered, it can use the receipt of PP36 as one of its input tax invoices and claim back the amount of VAT in the Form PP30 of the same month as PP36 submission.
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