Question 1

What does a Thai company have to file every month?

Accepted Answer

Typically monthly VAT and withholding tax returns,plus half-year and annual income tax filings. The rhythm is fixed,and filing late brings fines and surcharges.

Question 2

Do we have to withhold tax when we pay our Chinese parent or an overseas service provider?

Accepted Answer

A cross-border payment often triggers two obligations at once — withholding tax and reverse VAT. Missing one of the two is a frequent mistake. Settle the treatment before the money goes out.

Question 3

Can profit earned in Thailand be sent back to China properly?

Accepted Answer

Yes,but the route decides the cost. Dividends,service fees and royalties each carry their own tax cost and compliance requirements;pick the wrong one and you pay more tax,or leave a problem buried for later. Design the arrangement in advance — do not wait until the cash has piled up in the account to start thinking about it.

Question 4

What happens if a return is filed wrong?

Accepted Answer

Most problems can be put right afterwards by amending and paying the fine and surcharge,and they do not overturn your investment decisions. But repeated errors attract attention. The safe practice is to have someone check the return before it goes in.

Question 5

Can we pay a dividend before the audit is finished?

Accepted Answer

Not advisable. The procedural precondition for an annual dividend is a set of financial statements that have been audited and approved by the shareholders — Thailand requires a limited company's annual accounts to be audited by a registered auditor who issues an opinion. If you distribute before the profit figure has been confirmed by audit,and an audit adjustment then shrinks that profit,the payment can turn into an improper distribution that has to be paid back. If the cash need is real,the interim dividend route can be assessed;check case by case with the advisory team.

Question 6

Can a company that still has accumulated losses pay a dividend?

Accepted Answer

No. The Thai principle is that a dividend can only come out of profit. While accumulated losses on the books have not been made good,there is no distributable profit to speak of — later earnings have to fill the hole first,and only what is left over can be paid out. Making money this year does not help if the shortfall from earlier years is still sitting there. The amount actually available is worked out from the latest audited statements;check case by case with the advisory team.

Question 7

Is a dividend decided by the shareholders' meeting or by the board?

Accepted Answer

An annual dividend is resolved by the shareholders' meeting;it is not the board's call. The board's role is to draft the proposal,and to decide an interim dividend when the company does have profit. The order in practice:the board drafts the distribution plan,the shareholders' meeting approves the financial statements and passes the dividend resolution,then payment and withholding are carried out. Keep the resolution documents on file — the bank needs them for the remittance and the tax authorities for their records.

Question 8

Can we pay out part of a dividend in the middle of the year?

Accepted Answer

Yes. Thailand allows an interim dividend,on conditions:at the time of payment the company must have enough profit to support it,and there must be no unrecovered accumulated losses;the board resolves the payment,so there is no need to wait for the annual shareholders' meeting. The safe practice is to produce a set of interim management accounts first to work out the distributable profit,then go through the resolution and the withholding steps. Check the figures case by case with the advisory team.

Question 9

How much corporate income tax does a Thai company pay on its profit?

Accepted Answer

The standard rate is 20% of net profit. Qualifying small and medium-sized companies get banded lower rates:the first band of profit is exempt and the middle band is taxed at 15%. A project holding BOI promotion can also get corporate income tax relief within the approved period. Which band applies depends on the company's size and status;the latest official announcement governs.

Question 10

How is Thai corporate income tax worked out?

Accepted Answer

Corporate income tax = taxable net profit × the rate. Taxable net profit is computed on an accrual basis under section 65 of the Revenue Code:start from accounting profit,add back expenses that are not deductible,and deduct the items the tax law allows. Accounting profit and taxable profit are often not the same figure,so the tax adjustments have to be made before the books are closed.

Question 11

Does a company with a book loss still pay corporate income tax?

Accepted Answer

A book loss usually means no corporate income tax for that year,but the filing obligation never lapses — the annual PND.50 still goes in. What matters more is that a book loss is not the same as a tax loss:once non-deductible items are added back there may still be taxable profit to pay tax on. A confirmed tax loss can be carried forward five years against later profit. Check your own position with the advisory team.

Question 12

Are there income tax breaks for small and medium-sized companies in Thailand?

Accepted Answer

Yes. Qualifying small and medium-sized companies get banded preferential rates:the first THB 300,000 of net profit is exempt,THB 300,000 to THB 3 million is taxed at 15%,and anything above that at 20%. The thresholds are paid-up capital at the end of the period of no more than THB 5 million and annual revenue of no more than THB 30 million — both have to be met,not one or the other. Whether you qualify is checked case by case.

Question 13

When does a Thai company file its annual income tax return?

Accepted Answer

Twice a year. The half-year prepayment,PND.51,is filed within 2 months of the end of the first 6 months of the accounting year,based on estimated full-year profit. The annual return,PND.50,is filed within 150 days of the end of the accounting year with the audited financial statements attached,and the tax already paid at the half-year point is credited against the annual liability.

Question 14

When does VAT registration become compulsory?

Accepted Answer

Reaching the statutory turnover threshold makes registration mandatory — it is not a commercial choice about whether to issue tax invoices;certain businesses must also register before starting to trade. Below the threshold you may register voluntarily,and exporters and manufacturers usually need to:without registration there is no input credit,so tax paid on equipment and materials during the build-out is pure cost. The threshold amount is as currently published by the Revenue Department.

Question 15

We should have registered for VAT and never did. Can we just catch up?

Accepted Answer

The cost is asymmetric. Sales made while unregistered are still treated as taxable,so output tax has to be paid with penalties and surcharge — while input tax may not be recoverable to the same extent,being subject to conditions on documents and periods. One side catches up and the other may not,so the cash effect is a net outflow. You also cannot issue compliant tax invoices,so your customers cannot claim their input either. A historic gap is better planned as a whole — which periods,in what order — than patched piecemeal.

Question 16

Can a management fee charged by the parent be deducted in Thailand?

Accepted Answer

It has to pass two separate gates:the price must meet the arm's length principle,and the expense itself must have been incurred for the purpose of earning profit,with sufficient evidence. The way this usually fails for Chinese-invested companies is not that the price was too high,but that they cannot show the service actually happened and that the Thai subsidiary genuinely benefited. The classic pattern is a one-page contract plus an invoice and no work records — the pricing may be entirely reasonable while the evidence chain does not stand up.

Question 17

We are below the related-party disclosure threshold. Does that mean it does not apply to us?

Accepted Answer

No. Companies with annual revenue reaching THB 200 million must file the related-party disclosure form with the annual return,but being below the threshold does not exempt you from the arm's length principle — it only means you do not file that form. The pricing method still has to explain why this rate and this allocation basis,rather than "this is what the group has always charged",and once adopted it should be applied consistently rather than switched to whichever basis suits a given year.

Question 18

When is a tax health check worth doing?

Accepted Answer

Three moments give the best return:before the annual corporate income tax filing (large exposures such as revenue recognition and cross-border withholding cost far more to correct after the filing date),before claiming a VAT refund (a claim almost invariably attracts a review),and before a query from the Revenue Department. The core exercise is reconciling the accounts line by line against the returns already filed — plenty of companies have books that were "kept and filed",but nobody has ever put the two side by side.

Question 19

What do companies most often miss in their first year in Thailand?

Accepted Answer

Most often,carrying over the annual rhythm they are used to at home:withholding tax (the PND series) and VAT (PP.30) in Thailand are filed monthly,each with its own deadline,and missing them accumulates surcharge month by month. Next is handling only one half of a cross-border payment — withholding income tax and self-assessing VAT are two independent obligations on two separate returns. Third is a BOI exemption that stops at the certificate and is never reflected in the corporate income tax return,so none of the granted allowance is actually used.

Question 20

Do we have to withhold tax on payments to Thai local suppliers as well?

Accepted Answer

Yes. Domestic payments of service fees,commission and rent carry a withholding obligation too,filed monthly:PND.3 for payments to individuals and PND.53 for payments to Thai juristic persons — three separate returns once you add PND.54 for cross-border. The payer must also issue a withholding tax certificate to the payee,who uses it to credit against their own annual tax;a certificate never issued or issued incorrectly leaves the other side unable to claim,and it usually surfaces all at once at year end. The applicable rates vary by category of income and are as currently published by the Revenue Department.

Late filing means penalties — know the deadlines in advance