BOI tax exemption decides how much this project saves
Corporate income tax exemption and duty-free import of machinery are the single biggest policy benefit on offer when a company moves into Thailand.
In most cases,yes. A large number of manufacturing promotion categories set no limit on f…
BOI gives its tax holiday by tier. Within Category A the exemption period and the exempti…
The BOI evaluation clock runs from the day a complete file is submitted:40 working days f…
The BOI tier decision is the input that the investment projections and the shareholding s…
The certificate is not the finish line. It is the start of a long set of filing obligatio…
A BOI certificate is not a permanent tax exemption. Read three things first:the approved…
No. BOI mainly exempts corporate income tax — for a limited number of years and up to a c…
Holding the certificate puts you under two parallel reporting obligations:one reports pro…
A promoted project must finish construction and apply to start operations within 36 month…
Machinery brought in under the exemption has to be imported within the period stated in t…
Raw material duty exemption runs on a completely different system from machinery:you set…
The years of corporate income tax exemption,and the amount of it,run from the day the pro…
Holding a BOI certificate does not make the whole company exempt — only the activities na…
Foreign staff of a promoted company have a dedicated fast-track route,with quotas and app…
Yes. Promoted status is not a one-off award but a conditional contract — miss the conditi…
This is not a change to the Foreign Business Act. It is a change to BOI's own conditions…
Can my project apply for BOI?
Most manufacturing projects, and projects in the industries Thailand is targeting for support, have a chance at it — full foreign ownership is usually not the obstacle. What matters is picking the right activity category and arguing for the right tier, and that has to be assessed case by case.
Which taxes does BOI actually exempt?
The common ones are corporate income tax exemption (with rules on the number of years and on the cap) and duty-free import of machinery. Which of them your project gets, and how much, depends on the activity category and the tier; the current official rules decide it.
When is the right time to apply?
As early as possible. The tier assessment is an input to the investment projections and to the shareholding structure, and it has to be settled before equipment is ordered and imported. Do it in the wrong order and the work usually has to be redone.
Head office is sending Chinese engineers over — what happens with visas and work permits?
A promoted project has its own channel for foreign staff, and it usually runs more smoothly than the ordinary work permit route. Plan the staffing alongside the promoted status rather than patching it up once everyone has landed.
Once the certificate is issued, is that the end of it?
No. The certificate brings continuing reporting and performance obligations, and a missed filing can affect your exemptions or get them suspended. Our advisers can carry that part for you.
We are moving our factory to Thailand — is BOI worth applying for?
It comes down to three things: whether the line of business falls inside what BOI promotes, whether there is a real investment plan of a serious size, and whether the timing fits the length of the process. If all three line up, the exemptions on an A-tier project are often substantial and the application is worth pushing properly. If they do not line up, do not force it — the safest route is to check your own case with our advisers.
Which companies are a poor fit for BOI?
Three kinds are unlikely to fit: pure trading, pure retail and other lines that sit outside the promoted scope; pure agency arrangements with no real investment plan; and small projects well below the thresholds. Forcing an application through is hard to get approved and eats a great deal of time. If you are not sure which group you fall into, do a first pass before committing rather than starting an application you cannot finish.
What do you give up by building the plant without BOI?
Three things. Tax — without promotion, corporate income tax is paid at the ordinary rate, and import duty is paid on equipment and on raw materials used for export production. Shareholding and land — promoted status can, under defined conditions, lift some of the restrictions that ordinarily apply to foreign investors. Work permits — the route for bringing in foreign staff, and the treatment they get, are different. The larger the investment, the wider the gap.
What does applying for BOI cost?
The main item is the advisory fee, commonly on the order of several hundred thousand baht; large or complicated projects are quoted separately. On the government side, BOI also runs free consultation, in person and online, and official fees follow the current official announcements. Budget as well for document preparation: Chinese technical documents and agreements have to be translated into English and filed with the application. For a figure on your own project, check with our advisers.
The company is already operating — can we still apply for BOI now?
Yes. The application form itself has a branch for an existing operating company and a treatment for expansion projects, so applying from an entity that is already trading is routine. But note what the benefits attach to: the new investment in the approved project. Existing business does not become exempt because a certificate has been added, and the way the form is completed differs from a newly set up company. Check your own case with our advisers.
Apply through the existing company, or set up a new entity?
It depends what the existing company already does. Promotion privileges are granted per project, not to the company as a whole — once a company with other business obtains promotion, promoted and taxable activities must be accounted for separately, and if the books cannot be kept clean the exempt allowance itself becomes impossible to compute. A new entity starts with clean books by definition. Which suits better depends on the size of the existing business, where the assets sit and how you plan to exit, and is worth working through before filing.
Can one company hold several promoted activities at once?
You can hold multiple promoted projects, but each is a self-contained set: its own conditions, its own periods, its own allowance and reporting obligations. The benefit is covering different product lines; the cost is that compliance work multiplies by the number of projects, and promoted and taxable revenue must be tracked separately for each. It is not a case of "apply for more to be safe" — it should follow the actual business lines.
What happens if the wrong activity item is chosen?
The effects cascade. The item determines which tier applies, which additional conditions attach, whether land-holding and foreign-personnel treatment are available, and it carries through to position durations and staffing later. Getting it wrong is usually not "slightly less benefit" — it means the whole set of projections and the schedule has to be redone. The same business often maps to several candidate codes, and a different landing point produces a different outcome, which is why the tier assessment comes first.
How is the investment amount computed? Does a leased factory count?
There are defined exclusions (land and working capital are not counted, for instance), and rules on how capital expenditure such as equipment and construction is aggregated. A leased building and one you build yourself are not treated the same way. The mistake to avoid is the domestic habit of "adding up everything spent" — getting this wrong directly affects whether the threshold is met and the ceiling on the exemption that follows. The treatment is as currently published officially, and is best checked line by line against your budget.
We are shipping used equipment from China. Does that affect the tier?
Yes. Promoted projects carry a general requirement to use new machinery, and used equipment is subject to separate conditions and limits. Moving an old line across is usually a cost decision, but it simultaneously affects whether it counts toward the investment amount, whether it qualifies for duty-free import, and the technology case for the project as a whole. The equipment list has to be aligned with the tier strategy before it is filed for approval — not discovered at the point of shipment.
How should capacity be stated so as not to lose out?
Capacity is written into the conditions on the certificate; it is not a figure you enter and forget. State it too low and later output above it may raise a conditions issue; state it too high and you face pressure on achieving it and on how it is reported. The sound approach is to derive it from demonstrable equipment capability and shift patterns, leaving a sensible range, rather than picking a number that looks good.
Can the application be in Chinese? Do technical agreements need translating?
Supporting material submitted to the authority has to be readable by the people assessing it: Chinese originals generally have to be translated into English (Thai at certain stages) and certified in the prescribed manner. Chinese-invested companies typically have their technical proposals, process documents and equipment contracts in Chinese, and the translation effort is badly underestimated — it is not word-for-word work but making the technical substance and process route stand up in the translated text, which bears directly on the tier argument.
What if figures in different parts of the form do not agree?
You will be asked to put it right, and a query restarts the wait for a complete file. The sections of the application reconcile against one another — investment amount, capacity, headcount and financial projections are all linked — and internal inconsistency is one of the commonest reasons for a file coming back. A cross-section reconciliation before submitting costs far less than correcting it afterwards.
How long until we hear back? Can we track it ourselves?
Assessment has an official time limit, but the clock only starts once the file is complete, so a single query pushes the start back. Progress can be checked in the filing system. What most often wastes time in practice is the interview slot — the date you enter when submitting is a preference, not a confirmation; once accepted you have to arrange it yourself, and waiting for a notice simply burns the schedule.
What is asked at the interview? Who should attend, and in what language?
What is tested is whether the project stands up: the substance of the business, the process route, the basis for the investment and capacity figures, the evidence of technical content. Whoever answers has to genuinely understand the project — sending administrative staff or an interpreter alone falls apart at the first follow-up question. Language follows the arrangement, usually English; where technical detail is involved, an interpreter who does not understand the process is the single biggest risk, and agreeing terminology beforehand matters more than interpreting on the spot.
We have received a query. How should we respond?
Three things: answer point by point (do not simply send a new document); explain where differences come from (if a figure changed, say why); and complete it in one go (drip-feeding documents restarts the wait repeatedly). Leaving a query unanswered leaves the project where it is — assessment does not proceed because you have gone quiet.
Our application was refused. Can we apply again?
Generally yes, but it is worth establishing the actual reason — whether the activity item did not fit, a condition was not met, or the case was not made well enough. The three call for completely different responses. Refiling the same thing unchanged will most likely produce the same result.
Approval has not come through and the equipment is about to ship. What now?
This is one of the most expensive lessons. Duty-free import requires the equipment list to be filed and approved before shipment is arranged; if the goods arrive and the list is not approved, duty-free release cannot be done — you either sit at the port incurring charges or switch to a duty-paid import, turning the duty you saved into cash actually paid. If it has already got this far, the first step is to assess whether that particular shipment can be routed another way to limit the damage — but that is damage control, not standard practice.
Once approved, do the privileges apply straight away?
No. After approval there are still several steps — accepting the promotion, applying for the certificate and collecting it — each with its own deadline; and the income tax exemption has a starting point of its own, which is not the date the certificate is issued. Overrun any one of those steps and the work already done is discounted. What to do on receiving the approval letter is build the schedule, not celebrate.
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Tell us what the project builds and roughly what you plan to invest, and our advisers will give you a first read on whether BOI is worth taking further.
中文版 · Chinese version