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Ireland-Thailand

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Tax Treaty between Ireland and Thailand has entered into Force

The income and capital tax treaty between Ireland and Thailand entered into force on 11 March 2015. The treaty, signed 4 November 2013, is the first of its kind between the two countries.

Taxes Covered

The treaty covers Irish income tax, corporation tax and capital gains tax, and covers Thai income tax and petroleum income tax.

Service PE

The treaty includes the provision that a permanent establishment will be deemed constituted when an enterprise furnishes services within a Contracting State through employees or other engaged personnel for the same or connected project for a period or periods aggregating more than 6 months within any 12-month period.

Withholding Tax Rates

  • Dividends - 10%
  • Interest - 10% if the beneficial owner is a financial institution (including insurance companies) or in connection to a sale on credit of any equipment, merchandise or services as long as dealing at arm's length; otherwise 15%
  • Royalties -
    • 5% for the use of or the right to use any copyright of literary, artistic or scientific work, including software, and motion pictures and works on film, tape or other means of reproduction for use in connection with radio or television broadcasting;
    • 10% for the use of or the right to use industrial, commercial or scientific equipment or any patent; and
    • 15% for the use of or the right to use any trademark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience

Capital Gains

The following capital gains derived by a resident of one Contracting State may be taxed by the other State:

  • Gains from the alienation of immovable property situated in the other State;
  • Gains from the alienation of shares deriving more than 50% of their value directly or indirectly from immovable property situated in the other State unless the shares are quoted on a recognized stock exchange; and
  • Gains from the alienation of movable property forming part of the business property of a permanent establishment in the other State

Gains from the alienation of other property by a resident of a Contracting State may only be taxed by that State.

Double Taxation Relief

Both countries apply the credit method for the elimination of double taxation.

In regard to dividends, the credit shall take into account the tax payable by the dividend paying company in respect of the profits out of which such dividend is paid, provided certain control thresholds are met.

For Irish companies receiving dividends, the threshold is at least 5% direct or indirect control of the voting power of the Thai company paying the dividends. For Thai companies receiving dividends, the threshold is at least 25% direct or indirect control of the voting power of the Irish company paying the dividends.

Effective Date

The treaty applies from 1 January 2016.

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