When a taxpayer has submitted his/her tax return within the specified deadline but there is a problem or error in the computer program or the e-filing system or payment method which resulted to the tax filing and payment to be unsuccessful, the form can be filed and the tax can be paid within 7 business days from the last day of filing via the internet and a request for an extension can be submitted.
The taxpayer must submit a petition along with the form and pay the tax at the Revenue Department’s area office along with the supporting documents as follows:-
Request for extension and a letter of consider for disclosure of information
Explanation letter of the cause of problem or error
A copy of the list submitted through the House of Representatives
Copy of Form B.Ch.35, if required
MSNA can assist individual taxpayers in filing their Thai personal income tax returns and corporate taxpayers in filing their corporate income tax returns and monthly taxes. We have vast knowledge and expertise in accounting and Thai tax laws. Make sure you submit your taxes on time. Contact us now for more information.
Tax Single Sign On (Tax SSO) system is developed to integrate the use of electronic services via the Internet of the three tax departments: the Revenue Department, the Excise Department and the Customs Department by using a single user and password to access the services of all three tax departments, in a one-stop service manner. This is not the same as SSO or Social Security Office.
Tax SSO service system’s main objective is to improve the tax service level of the Ministry of Finance, reduce the steps and facilitate the public in using the tax services of the three tax departments. It also helps entrepreneurs of both corporate entities and individuals to be convenient, flexible, fast and confident with security according to international standards.
Tax SSO service system provides:-
e-Filing system service of the Revenue Department which includes tax filing service such as monthly withholding tax forms (PND 1, PND 2, PND 3, PND 53 and PND 54), monthly VAT forms (PP 30, PP 36), Specific Business Tax (PT 40), corporate income tax (PND 50, PND 51, PND 52, PND 55), annual withholding tax (PND 1Gor, PND 2Gor) and personal income tax (PND 90, PND 91, PND 93, PND 94, PND 95)
e-Excise system service of the Excise Department includes online tax payment service for all types of products such as alcohol, tobacco, oil, cars, motorcycles and others as well as tax form status tracking service and electronic receipt printing service
e-Tracking service of the Customs Department includes service to check the account information, report in and out vehicles at any time, check the status of the goods transport note at any time and check the status of the goods transport invoice as well s verifying data registered with the Customs Department’s visitor registration system, checking outstanding customs fee payments, viewing customs fee payment history, displaying tax benefit information and checking refund transfer information, etc.
Make sure you submit your taxes in time. Contact MSNA for Tax SSO service system registration, tax filing and tax consulting services.
The Thai BOI grants the promoted activities with tax and non-tax incentives. In order to obtain investment promotion, the BOI applicant must follow the conditions prescribed by the Board of Investment as specified in the BOI promotion certificate in which the following incentives will be granted in accordance with the Investment Promotion Act:
Exemption or reduction of import duties on machinery (under Section 28/29)
Reduction of import duties for raw or essential materials (Section 30)
Exemption of import duties on materials imported for R&D purposes (Section 30/1)
Exemption of corporate income tax on the net profit and dividends derived from the promoted activity (Section 31, 31/1 and 34)
A 50% reduction of the corporate income tax (Section 35(1))
Double deduction from the costs of transportation, electricity and water supply (Section 35 (2))
Additional 25% deduction of the cost of installation or construction of facilities (Section 35 (3))
Exemption of import duty on raw or essential materials imported for use in production for export (Section 36)
However, not all promoted activities can be granted with the same tax incentives but if your company is one of those that can be eligible, we highly recommend to seek a BOI expert like us when you apply to open the BOI operation.
When an employee of a Thai company incurred expenses for an overseas business trip which can be refunded from the organizers abroad, the Thai company can payback its employee for the expenses incurred and reimbursed it from such overseas based company through the following:
All official receipts must be issued to the Thai company. Those receipts will be treated as expenses of the company so that when it issues an invoice to the overseas based company, such amount will be treated as income of the Thai company, which 7% VAT has to be added in the invoice; OR
All receipts (amount of expenses and VAT) will be recorded as Account Receivable from overseas based company so that when it issued an invoice to the overseas based company, it should use the wording “reimbursement at cost”. In this way, all the receipts that the company cannot claim back the 7% VAT will also be reimbursed. There is no need to add 7% VAT in the invoice because the company is reimbursing the whole amount plus VAT that appears on the receipts.
In Thailand, individual and corporate investors have different tax rates on interest based on profits from investment in debt instruments.
For domestic investors, withholding tax rate for individuals is 15% and they can choose not to include it in their annual filing of personal income tax. For companies or juristic partnerships, withholding tax rate is 1%.
For foreign investors, withholding tax rate is 15% for both individual and company or juristic partnership with exception to countries having Double Taxation Agreement (DTA) with Thailand, which may be subjected to a lower tax rate.
Contact MSNA for your accounting and Thailand tax questions.
Our monthly accounting and tax services include preparation of the compulsory input VAT and output VAT reports for the clients. We deliver everything as promised within the agreed upon deadline and make sure that the client’s accounts are prepared accurately. Thus, whenever we send the report to the clients, we ask them to check the report that we prepared because there have been cases where:
1. The clients go back and change the amount in some tax invoices and fail to inform us and send us the updated version
2. The clients did not send us all the tax invoices they issued during the month and assumed that they sent everything to us already then, the issue arises when some tax invoices where not included in the Sale VAT report which resulted to huge amount of Value Added Tax to pay to the Revenue Department
We therefore learned that we must get the clients to confirm that the monthly VAT report has the correct details of all the tax invoices issued during the month and the amounts are the same as the original invoices.
With our extensive knowledge and expertise in the Thai accounting and tax laws, we ensure that we provide valuable source of advice and solutions to our clients. If you are looking for an international standard professional services providers at reasonable prices, MSNA is your right partner.
One of our tax clients asked us on how to revalue the land and houses in Thailand. Normally, land ownership is not possible to foreigners but there are certain ways on how foreigners can own land in Thailand. Our client has set up a Thai majority owned company.
If the company is engage in the business of real estate (buy and sell of land and houses), the land and houses are treated as inventory so the appreciated amount will be income to the company. Thus, when the company revalues the land and houses, it has to book the gain/loss into the company’s profit and loss statement, whereas there are taxes to be paid in case of profits.
However, if the company is not selling real estate, the land is just a normal fixed asset. In summary, if you get the revaluation report and it shows that the land’s value has appreciated and you want to book the appreciated amount in the company’s accounting, it will be booked in the shareholders’ equity section of the Balance Sheet, not as an income in the Profit and Loss Statement. That means no tax to pay yet.
To explain it further, according to the Thai Revenue Department’s Revenue Code Section 65 Bis, value of assets other than value of stock on the last day of an accounting period shall be calculated in accordance with the cost or market price, whichever is lower, and such value shall be deemed to be the value of stock carried forward into the new accounting period, shall use the normal purchase price of such asset and in the case of appreciation in the value of the asset, such appreciation shall not be included in the calculation of net profit or net loss. If any item of assets is entitled to depreciation or depletion, depreciation and depletion shall be deductible in the calculation of net profit or net loss in accordance with the rules, procedures, conditions and previous rates applicable before the appreciation in the value of assets by deducting and only the remaining period and remaining cost of capital of the assets shall be deducted.
MSNA provides accounting, tax, due diligence, payroll and related business services. Contact us now for initial consultation.
One of our accounting and tax clients consulted with us regarding a Thai company making payments to its vendors overseas.
In response, we explain that when a company in Thailand wants to make payments to overseas, one needs to consider 3 things:
If it is for services, in most cases, the company will need to withhold some taxes from the payment and submit it to the Thai Revenue Department.
For paying an overseas vendor, the Thai company will have to submit 7% Value Added Tax (VAT) to the Revenue Department on behalf of the overseas vendor. To give an example, when a Thai company makes payment to a company in Singapore, VAT must be submitted with Form PP.36 by the 7th of the following month.
When a company in Thailand wants to make a money transfer to overseas, it is required to fill out some bank forms and provide them some kind of documents supporting the purpose of the transfer, e.g. a copy of the invoice from the overseas vendor, a copy of the loan agreement etc.
MSNA’s team of English speaking accountants can help you with your company’s Thai accounts, tax planning, audit and other matters regarding doing business in Thailand. Contact us now for initial consultation.
One of the questions our clients ask us the most is how much tax rate to use when calculating Corporate Income Tax in Thailand.
The corporate income tax rates depends on the amount of capital and its net income during the year. To explain it further:
1. If the company has less than THB 5 million capital and has less than THB 30 million income, the tax rates to be used are as follows:-
Tax Rate
First THB 300,000 = 0%
300,001 – 3,000,000 = 15%
Over 3,000,000 = 20%
2. If the company has more than THB 5 million capital and even if they decrease it later, it is fixed to 20% every year as long as the company is existing.
3. If the company has more than THB 30 million income and if the income decreases next year, it is also fixed to 20% as long as the company is existing.
Make sure your accounting and taxes are done properly and be mindful of the deadline for submission of corporate income tax and audited financial statements. Contact MSNA for consultation on Thai taxes and filing of requirements for your company in Thailand.
One of our accounting and tax clients wants some clarification regarding how withholding taxes in Thailand work particularly the withholding taxes on software license transactions.
Question:
Could you kindly confirm whether the 3% withholding tax rate applies universally to all software license orders? And in the event that we are required to pay the withholding tax at 3% rate for any type of software, are there any provisions or exceptions that would allow us to reduce the withholding tax rate to 1%?
Answer:
The 3% withholding tax rate is standard across all software licenses bought or paid for usage in Thailand. When you buy a software from overseas, you will need to submit the withholding tax (rates depending on the country) and 7% VAT on behalf of the overseas vendor(s) too.
Additionally, the Thai tax laws require buyers or users of software to withhold 3% tax. In your case, you should withhold it from the payment when you pay your vendors. You should not pay the withholding tax from your pocket. Anyway, you can check with us before making any payment to your new vendors to make sure you withhold the right amount accordingly.
MSNA can provide consultation on Thai taxes and accounting. And if you use our monthly services, our fees include consultation with our directors on tax and accounting issues. For instance, some vendors do not want you to withhold tax, we can discuss with you on what to do for withholding taxes from vendors in Thailand.
