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Business Tax and Tax Rates in Thailand

Blog Banner | Business Taxes in Thailand

Business operating in Thailand and exceeding 1.8M THB in turnover are subject to paying VAT (value added tax), or in other words, an indirect tax imposed on the value added at each stage of production and distribution.

 

However, the nature of some businesses, such as financial institutions and services, does not allow for clear distinction between production costs and the value added, which resulted in the introduction of Specific Business Tax (SBT). SBT is a parallel tax to VAT and its origins likewise date back to 1992.

 

As previously mentioned, some of the business liable to pay SBT instead of VAT operate in finances, namely banks, financial institutions, insurance and loan companies and others. Other qualifying entities that fall into this category must bear a resemblance to the above-listed businesses in terms of transaction type; are real estate companies and businesses concerning sale of securities. The law, however, allows for exemptions and the full list of SBT exempted types of businesses can be found

here.

 

TAX RATES


BUSINESS

BASE

RATES

Banking, Finance and similar business

Interest, discounts, service fees, other fees, profits from foreign exchange

 

3%

Business of finance, securities and credit foncier

Interest, discounts, service fees, other fees, profits from foreign exchange


 

3%

Life Insurance

Interest, service fees and other fees


 

2.5%

Pawn Brokerage


 

Interest, fees, remuneration from selling overdue property


 

2.5%

Business with regular transactions similar to commercial banks


 

Interest, discounts, service fees, other fees, profits from foreign exchange


 

3%

Real estate


 

Gross receipts


 

0.1%

Foreign company engaging in international transportation


 

Gross receipts


 

3%

Foreign company not conducting business in Thailand but receiving dividends from Thailand


 

Gross receipts


 

10%

Foreign company not conducting business in Thailand but receiving other types of income apart from dividend from Thailand


 

Gross receipts


 

15%

sale of securities in a securities market


 

Gross receipts


 

0.1%

REGISTRATION AND FILING A RETURN


Businesses or persons that are subject to SBT are required to register to such tax within 30 days of the commencement of their operations. In case of Bangkok-based companies, the registration takes place at the Area Revenue Office. Outside companies must register at the District Revenue Office.

 

As with VAT, SBT must be also filed and paid on a monthly basis regardless of the company’s income. Both return and payment are due by the 15th of each month and in case of a multiple-branched offices, it must be done separately by individual branches/places of business.