| Accounting and Taxation in Thailand | ||||
| Firms must keep books and follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounts Act. Documents may be prepared in any language, provided that a Thai translation is attached. All accounting entries should be written in ink, typewritten, or printed. | ||||
| A. Imposition of Taxes | ||||
| 1. Firms are required to withhold income tax from the salary of all regular employees. | ||||
| 2. A value-added tax of seven percent is levied on the value added at each stage of the | ||||
| production process, and is applicable to most firms. The VAT must be paid on a monthly basis. |
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| 3. A specific business tax is levied on firms engaged in several categories of businesses | ||||
| not subject to VAT, based on gross receipts, at a variable rate ranging from 0.1-3.0 percent. |
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| 4.Corporate income tax is 20-30 percent of net profits and is due twice each fiscal year. | ||||
| A mid-year profit forecast entails advance payment of corporate taxes. | ||||
| B. Annual Accounts | ||||
| A newly-established company or partnership should close accounts within 12 months from the date of its registration. Thereafter, the accounts should be closed every 12 months. The performance record is to be certified by the company auditor, approved by shareholders, and filed with the Business Development Office, Ministry of Commerce, within five months of the end of the fiscal year, and with the Revenue Department, Ministry of Finance, within 150 days of the end of the fiscal year. If a company wishes to change its accounting period, it must obtain written approval from the Director General of the Revenue Department |
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| C. Accounting Principles | ||||
| In general, the basic accounting principles practiced in the United States are accepted in Thailand, as are accounting methods and conventions as sanctioned by law. The Institute of Certified Accountants and Auditors of Thailand is the authoritative group promoting the application of generally accepted accounting principles. Any accounting method adopted by a company must be used consistently and may be changed only with approval of the Revenue Department. |
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| D. Auditing Requirements and Standards | ||||
| Audited financial statements of juristic entities (that is, a limited company, a registered partnership, a branch, or representative office, or a regional office of a foreign corporation, or a joint venture) must be certified by an authorized auditor and submitted to the Revenue Department and (except for joint ventures) to the Commercial Registrar for each accounting year. Auditing standards conforming to international auditing standards are, to the greater extent, |
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| Thailand withholding income tax | ||||
| A. Withholding income tax is collected from income receiver who are : | ||||
| (a) juristic or partnership which is set up either under Thai law | ||||
| (b) a foundation or an association of government whose activity is done as a business or | ||||
| in a professoinal like manner except charity organization stated on Royal Decree. | ||||
| B. Who has to collect the withholding income tax | ||||
| 1. Partnership 2. companies 3. Justice person 4. Ordinary person 5. Association 6. Foundation 7. Groups of persons 8. Government organization 9. Municipality 10. Sanitation district 11. Other local government authority these people shall deduct income tax at each time of payment of the income. |
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| C. What requirements should the income payer(employer) follow while deducting and withholding income tax : | ||||
| 1. You need to have tax identification number. 2. You need to deduct income tax at every payment and according to the regulation. 3. You need to issue the certificate of Tax deduction |
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| Note : for the government organization (public health, the government officer will issue | ||||
| the document to one who receives income. | ||||
| 4. You need to remit the withholding income tax to the local district officer within 7 days | ||||
| of the following month. You have to submit both money and form. | ||||