Today, we answer a question from one of our accounting clients regarding the tax withheld by overseas-based company. Can they recover this cost?
In theory, the tax withheld by another country should be a tax credit to the Thai company, but only if the company makes profit and will have to pay tax, then this tax credit will lower the amount of tax check it has to pay to the Revenue Department.
Hence, to use the withholding tax as tax credit, the company needs the following documents to prove it:
- The withholding tax certificate issued by the client overseas, and has to attach its Thai translation too.
- The proof of payment for the service on the transaction.