subject: Accounting, audit and tax compliance [print this page] Accounting, audit and tax compliance Accounting, audit and tax compliance
Accounting and audit compliance
Thailand's Accounting Act prescribes that all business entities in Thailand shall maintain books of accounts and supporting records in Thailand, and shall prepare annual financial statements in accordance with Thai Accounting Standards.
The Thai Accounting Act also stipulates that all business entities in Thailand shall appoint an accountant, who is a Thai national holding a Bachelor of Accounting degree, and shall also appoint a Thai national auditor, who shall audit the books and records and the annual financial statements of the business entity in Thailand.
Accordingly, no matter what entity is chosen in Thailand, the entity in Thailand shall employ a Thai national accountant with the appropriate qualifications, and additionally, a Thai national auditor with the appropriate qualifications.
Annual reporting to the regulatory authority
All of the entity types are required to file two sets of their audited financial statements and a statutory annual return with the Department of Business Development under the Ministry of Commerce.
The audited financial statements and statutory annual returns shall be filed within five months of the entity's financial year-end date. In addition to the audited financial statements and statutory annual return, a private limited company entity and an ROH entity in Thailand shall also be required to hold an annual general meeting of shareholders (which meeting shall be held within four months of the financial year-end date) and shall additionally file a listing of shareholders of the entity with the Department of Business Development as at the date of the annual general meeting of shareholders.
Corporate income tax compliance
All of the entity types are required to prepare and file an annual corporate income tax return with the Thailand Revenue Department within 5 months of the entity's financial year-end date. No extensions are permitted under the Thai Revenue Code, and an automatic surcharge (interest penalty) of 1.5% per month late is payable for all late tax returns filed.
The annual corporate income tax returns are accompanied by one set of the entity's audited financial statements, and a statement by the entity's director or manager (as the case maybe) certifying as to the entity's tax compliance.
As discussed previously, a representative office entity and a regional office entity in Thailand is not subject to corporate income tax in Thailand, and the annual corporate income tax returns for these entities are prepared and filed with the Thai Revenue Department for the purposes of monitoring the entity only.
Value added tax compliance
Liability to VAT in Thailand occurs when goods are sold or services are provided to consumers in Thailand, and thus, for all entity types (other than representative offices and regional offices, which are exempt from VAT in Thailand) the entity would be required to account for and file VAT returns to the Thai Revenue Department.
Accounting and filing of VAT returns is done on a monthly basis. An entity liable to VAT shall account for its monthly VAT collections, file its VAT for that month and pay the amount of its VAT liability to the Thai Revenue Department within the 15th day of the following month.
Again, as the Thailand Revenue Code does not permit any extensions, all late VAT returns are subject to the 1.5% per month surcharge.
