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Corporate Income Tax (CIT) is a direct tax imposed on companies and juristic partnerships carrying on business in Thailand or deriving certain types of income from Thailand. The tax is governed primarily by the Thai Revenue Code and applies to both Thai and foreign entities under specific circumstances.
This FAQ provides general information about Corporate Income Tax in Thailand, including who is subject to tax, filing obligations, tax rates, tax prepayments, and dividend exemptions.
Under the Thai Revenue Code, the following entities may be subject to Corporate Income Tax:
Yes.
A company or juristic partnership incorporated under Thai law is generally subject to Corporate Income Tax on its worldwide income, regardless of where the income is earned.
No.
A company incorporated under foreign law is generally taxed only on income derived from sources within Thailand, unless specific provisions of Thai tax law apply.
The standard Corporate Income Tax rate is 20% of net taxable profits.
Certain small and medium-sized enterprises (SMEs) may qualify for reduced tax rates on a portion of their net profits, subject to eligibility requirements prescribed by the Revenue Department.
Corporate Income Tax is generally calculated based on the company’s net profit using the accrual accounting method.
Net profit is determined by:
Total Revenue
minus
Allowable Business Expenses
equals
Net Taxable Profit
Income is generally recognized when it is earned, regardless of whether payment has been received. Similarly, expenses are generally recognized when incurred, regardless of whether they have been paid.
Companies carrying on business in Thailand must file an annual Corporate Income Tax return and pay any tax due within 150 days from the end of their accounting period.
For most companies, the accounting period is twelve months. However, a newly incorporated company may adopt a shorter first accounting period.
Any subsequent change to an accounting period generally requires approval from the Revenue Department.
Yes.
A company may be entitled to a tax refund if its withholding tax credits and tax prepayments exceed its final Corporate Income Tax liability for the accounting period.
Companies subject to Corporate Income Tax on net profits are generally required to file a mid-year tax return.
The mid-year filing is made using Form PND 51 and requires the company to estimate its annual net profit and tax liability.
The mid-year Corporate Income Tax return must be filed within two months after the end of the first six months of the company's accounting period.
The company is generally required to pay one-half of its estimated annual Corporate Income Tax liability at that time.
A foreign company that does not carry on business in Thailand but receives certain types of Thai-source income may be subject to withholding tax.
The applicable withholding tax rate depends on the nature of the income and may be reduced under an applicable Double Tax Agreement (DTA) between Thailand and the foreign company's country of residence.
The payer of the income is generally responsible for withholding the tax at source and remitting it to the Revenue Department.
The withholding tax return and payment are generally required to be submitted within seven days of the month following the payment.
A full exemption may apply where:
Additional conditions may apply depending on the circumstances.
Yes.
Thailand has entered into Double Tax Agreements with numerous countries to help prevent double taxation and provide relief from certain withholding taxes.
The availability of treaty benefits depends on the specific treaty provisions and the taxpayer’s eligibility.
Corporate Income Tax obligations can vary depending on a company's structure, business activities, accounting records, international transactions, and available tax incentives.
Professional legal and tax advice can help businesses remain compliant, minimize risks, and take advantage of available tax planning opportunities under Thai law.
Understanding Corporate Income Tax in Thailand is essential for maintaining compliance and avoiding costly penalties. Whether you are establishing a new company, operating an existing business, or investing in Thailand through a foreign entity, proper tax planning and compliance can help protect your business interests and reduce unnecessary risks.
If you require assistance with company registration, corporate restructuring, tax compliance, business licensing, or legal matters relating to Corporate Income Tax in Thailand, the legal team at Magna Carta Law Firm can provide practical guidance tailored to your business needs.
Contact Magna Carta Law Firm today to schedule a consultation and discuss your corporate and tax-related concerns in Thailand.
Legal Disclaimer
The information provided on this page is for general informational purposes only and does not constitute legal, tax, accounting, or professional advice. Tax laws, regulations, administrative practices, and Revenue Department interpretations may change over time and may vary depending on the specific circumstances of each case. Readers should not act or refrain from acting based solely on the information contained herein and should seek professional legal, tax, or accounting advice regarding their particular situation. Viewing this page or communicating with Magna Carta Law Firm through this website does not create a lawyer-client relationship.
Licensed CPD in Accountancy
Specialization: Tax Planning, Full Accounting System, Financial Statement
