Corporate income tax

Corporate income tax

Tax rate
Tax on profits:

Taxpayer Accounting Period Commencing on or after Tax base (THB) Tax rate
Companies or Juristic partnerships 1 January 2017 All taxable profit 20%
 SMEs (Note 1)  1 January 2017 onward  1 – 300,000 Exempt
300,001 – 3,000,000 15%
Over 3,000,000 20%
All taxable profit Exempt
 SMEs granted Tax Amnesty 1 January 2017 1 – 300,000 Exempt
Over 300,000 10%
1 January 2018 onward 1 – 300,000 Exempt
300,001 – 3,000,000 15%
Over 3,000,000 20%

Note 1.  For companies or juristic partnerships with paid-up capital not exceeding THB  5 million on the last day of the accounting period, and with income from sales of goods and provision of services in any accounting period of not more than THB 30 million (consecutively from the accounting period commencing on or after 1 January 2012).

Tax on gross receipts:

Taxplayer Tax rate
International transportation by a foreign carrier 3%
Foundation or association
Business income  2%
Other income, e.g. interest, dividend, rent (Income from membership fees and Donations is exempted) 10%

Depreciation allowances
Depreciation must be based on the historical cost of an asset Acquired, using generally accepted accounting methods, For tax purposes, the depreciation period must not be less than the prescribed period applicable to each fixed asset type (see table below).

Asset type Minimum depreciation period
General company SME1
Buildings 20 years 20 years with 25% upfront on the acquisition date for factory buildings
Acquisition cost of Depletable natural Resources 20 years
Leasehold rights Lease period plus any renewable periods (but 10 years if There is no lease agreement or the lease allows for renewal for an unlimited period)
Trademark, goodwill, Licenses, patents and Copyrights or other rights Period of use (but 10 years if the period of use is unlimited)
Computer hardware and Software 3 years 3 years with 40% upfront on the acquisition date
Cash registers used for Issuing abbreviated tax Invoices by retail business or other businesses as approved by the Director-General A choice of either 5 years, or 5 years with 40% upfront depreciation or 1 year
Furniture, fixtures, Machinery2, equipment2,Motor vehicles and others Not mentioned above 5 years 5 years, or 5 years with 40% upfront depreciation for machinery and equipment

1 SME is a company or jurist partnership with fixed assets (excluding land) of no more than THB200 million and with no more than 200 employees.

2 For machinery and equipment used for technological research and development (as defined), a company or juristic partnership can claim upfront depreciation at 40% on the acquisition date. The remainder is deprecated over a period of at least 5 years.

The depreciation base for motor vehicles seating up to 10 persons is capped at THB1 million. The excess is neither depreciable nor claimable as costs/expenses upon disposal for tax computation purposes. However, this does not apply for vehicles used for rental and qualified prototype cars.

Depreciation of an asset acquired under a hire-purchase agreement must be based on the entire amount (including the interest element) payable under the agreement. The depreciation claimed for a period plus the accumulated depreciation brought forward from the previous period cannot exceed the cumulative total of the instalments paid up to the end of that period.

Limits on entertainment For tax computation purposes, entertainment expenses must Expenses not exceed the higher of 0.3% of gross annual revenue or 0.3% of paid-up capital. However, the maximum deductible Amount of entertainment expenses is THB 10 million.
To be tax deductible, the entertainment expenses must relate directly to the company’s business and entertainment expenses must be supported by relevant documentary evidence of payment. In addition, costs of articles given to the entertained persons must not exceed THB 2,000 per person on each occasion
Dividend income
Dividends Received from Thai resident Company:
Subject to the stated conditions:
An SET-listed company can exclude all dividends received from a Thai resident company from its taxable profit. An unlisted company that owns at least a 25% equity interest in another Thai resident company can exclude all dividends received from that company from its taxable profit, provided that the latter company does not own a direct or indirect or indirect equity interest in the recipient company
All other unlisted companies can exclude half (50%) of the dividends received from a Thai resident company from their taxable profits. Condition: The above exclusions are not allowed if the dividend recipient company has held the relevant shares for less than 3 months before receiving the dividend or if it disposes of Those shares within 3 months after receiving the dividend (“3 plus 3” rule).
Dividends received from Overseas company: A company that owns at least a 25% equity interest in another overseas company can exclude dividends Received from the overseas company from its taxable profit
Provided that it has held the investment for at least 6 months before receiving such dividends, and that the profit out of which the dividends are distributed is subject to income tax in the overseas county at a rate of not less than 15%
Tax losses Tax losses can be carried forward to deduct against future Profits for period of 5 years. There is no claw-back provision.
Tax fillings
Half-year(interim)tax filing
A half-year tax return must be filed, with related tax paid, withRelated tax paid, within 2 months after the end of a half-year period. No filing is required for the first and the last accounting Period, if they are shorter than 12 months
If a company changes its year-end date, no interim tax return Filing is required for the first accounting period after the Change if that period is less than 6 months. For listed companies, financial institutions and other Companies specifically approved by the Director-General, Interim tax can be based on the actual profit for the first Half-year, as substantiated by the audited or reviewed financial statements. for other companies, interim tax is submitted based on half of the estimated annual profit but no audited financial statements need to be submitted. However, the permitted range of underestimation of net profit for the interim tax 25% of the actual profit. If the difference between the estimated profit is larger than 25% without justifiable reason, the company will be subject to a surcharge at the rate of 20% of the tax shortfall.
Annual tax filing An annual tax return must be filed, with related tax paid, with the Revenue Office within 150 days after the company’s fiscal year-end date. The audited financial statement must accompany the tax return.