Resident companies are liable to corporate tax in Thailand on their worldwide income, wherever derived. Taxable income is defined as gross income from all sources unless specifically exempt, less substantiated and reasonable expenditure and allowances necessary for the business. Under specific incentive rules, tax law allows for exceptional deductions (over and above actual cost) and/or depreciation.
Effective from 14 May 2018, income from digital assets, including income from holding or transfer of cryptocurrency and digital tokens is treated as ordinary income and subject to tax in Thailand.
Capital gains are generally treated as ordinary business income, whilst dividends may benefit from an exemption, provided the recipient holds at least 25% of the total voting shares without any cross-shareholding in the distributing company and such shares have been held for at least three months before and three months after the dividends were received.
Effective 13 November 2019, mutul funds are subject to tax on their income received after 20 August 2019.
Accordingly, companies/ investors are eligible for a tax exemption on the following types of investment income received after 20 August 2019 from mutual funds:
- Share of profits derived from certain specified mutual funds;
- Capital gains derived from the sale of investment units in certain specified mutual funds under the law governing securities and stock exchanges; and
- Share of profits received from mutual funds (except real estate property funds) by legal persons established under Thai law or funds established and operated by an investment management company (50% exemption for non-listed company and 100% exemption for listed company), subject to certain conditions.
Subject to few exceptions, income is recognized on an accrual basis.