Corporate income tax in Thailand.

Corporate income tax (CIT) applies to companies and juristic partnerships operating in Thailand, as well as to certain foreign entities that derive income from within the country. For any company establishing or running a business in Thailand, understanding the rate structure, filing obligations and available incentives determines how tax is planned and managed from the outset.

This guide explains Thailand’s corporate income tax framework, including applicable rates for different types of taxpayers, who is liable to pay, filing requirements and timing, the practical meaning of the accounting period and incentives offered through the Board of Investment (BOI). It also covers how Thai-registered companies are taxed on foreign-sourced income, a frequent consideration for businesses with overseas clients or cross-border revenue.

Corporate tax rates in Thailand

The standard CIT rate in Thailand is 20% of net profit, applied to most Thai-incorporated companies and to foreign companies carrying on business in the country. Qualifying small companies benefit from a progressive structure, and certain foreign entities face a final withholding tax on Thai-sourced income rather than a net profit assessment.

Small company (a company with a paid-up capital of less than THB 5 million at the end of each accounting year and gross revenue of less than 30 million Thai baht in any accounting year)Net profit from THB 300,000 not exceeding THB 3 million

To qualify for the progressive rates, the entity must be incorporated under Thai law, have paid-up registered capital not exceeding THB 5 million at the end of the accounting period and have annual revenue from sales and services below THB 30 million. If either threshold is exceeded in any given year, the standard 20% rate applies for that year.

Global minimum tax (Pillar Two)

Thailand introduced a domestic top-up tax on 26 December 2024 through the Emergency Decree on Top-up Tax B.E. 2567, which came into effect for fiscal years beginning on or after 1 January 2025. The rules apply to entities in Thailand that form part of a multinational enterprise (MNE) group with consolidated global revenue exceeding EUR 750 million for at least two of the four preceding fiscal years.

Where the effective tax rate on Thai-sourced profits falls below 15%, a top-up charge brings it to the minimum. Thailand adopted all three Pillar Two mechanisms simultaneously: the Qualified Domestic Minimum Top-up Tax (QDMTT), the Qualified Income Inclusion Rule (QIIR) and the Qualified Undertaxed Profits Rule (QUTPR). The top-up tax return and the Global Anti-Base Erosion Information Return (GIR) are generally due within 15 months of the financial year-end, or 18 months for the first transition year. Companies within scope should assess their effective tax rate in Thailand and confirm whether existing BOI exemptions affect the QDMTT calculation.

Who is considered as a taxable person?

The following entities have a duty of paying corporate income tax:

1. A company or juristic partnership incorporated under Thai law
   1. Limited company
   2. Public company limited
   3. Limited partnership
   4. Registered partnership
2. A company or juristic partnership incorporated under foreign laws that:
   1. Conduct business in Thailand
   2. Conduct business in Thailand and in other places including Thailand
   3. Conduct business in other places including Thailand, in case of carriage of goods or carriage of passengers
   4. Has an employee, an agent or a go-between for carrying on business in Thailand and as a result received income or profits in Thailand
   5. Does not conduct business in Thailand, but receiving assessable income under Section 40 (2)(3)(4)(5) or (6) which is paid from or in Thailand
   6. Distributes profit from conducting business in Thailand to other countries
3. A business operating in a commercial or profitable manner by a foreign government, organisation of a foreign government or any other juristic person established under a foreign law.
4. Incorporated and unincorporated joint ventures
5. A foundation or association conducting revenue-generating business, but does not include the foundation or association as prescribed in Section 47 (7)(b)
6. A juristic person who is considered as a company or juristic partnership by the Minister and approved by the Royal Thai Government Gazette.

Corporate tax return filing and the accounting period

Thai corporate income tax obligations vary by entity type and activity, with specific rules on filing and payment deadlines.

When do companies file and pay tax return?

Thai and foreign companies conducting business in Thailand have the duty to file their tax returns (Form CIT 50) and pay taxes within 150 days from the closing date of their accounting periods.

Other entities not engaged in generating business but only disposing funds/profit from Thailand are also liable to pay corporate income tax, however, they must do so within seven days of the disposal date (Form CIT 54).

A company in Thailand subject to corporate income tax on net profits is also required to make tax prepayment (Form CIT 51). Companies are obliged to estimate their annual net profit as well as its tax liability and make a prepayment no later than two months after the first six months of their accounting periods.

Foreign entities receiving income from Thailand but not conducting business locally are subject to a flat-rate tax, which the payer withholds at the time of payment in accordance with Thailand’s withholding tax rules. The payer is also required to file the corresponding return (Form CIT 54) and remit payment to the Revenue Department within seven days of the following month.

Late filing is subject to fines of between THB 1,000 and THB 2,000, plus surcharges of 1.5% per month on any underpaid tax.

What is the accounting period?

The accounting period is 12 months except in the following conditions which can be less than 12 months:

• A newly incorporated company or juristic partnership may choose to use the period from its incorporation date to any one date as the first accounting period
• A company or juristic partnership may file a request to the Director-General to change the last day of an accounting period. The Director-General has the power to grant approval and the company or juristic partnership must be notified within a reasonable period of time. If the Director-General approves, the company or juristic partnership complies with the accounting period as prescribed by the Director-General.

What expenses can a Thai company deduct?

Thai companies can deduct expenses that are ordinary, necessary and directly related to generating income, provided they are supported by proper documentation. Allowable categories include salaries and wages, rent, interest on business loans, depreciation of qualifying assets and cost of goods sold. Certain expenses are subject to specific conditions or caps under the Revenue Code, and the treatment is not always straightforward.

One common source of confusion is the difference between what is booked as an expense under Thai Financial Reporting Standards and what the Revenue Department allows. Accounting standards record expenses on an accrual basis, while the Revenue Code applies its own conditions for timing, documentation and allowable amounts. Common items booked as expenses but disallowed or capped for tax include provisions, depreciation on certain assets, entertainment above the statutory limit and payments lacking proper tax invoices. These differences are reconciled on the corporate income tax return (Form CIT 50).

Two specific categories worth noting:

Director and shareholder salaries

A director’s or shareholder’s salary is deductible if it is paid for actual services rendered, reflects a reasonable arm’s length rate and is supported by employment contracts, payroll records and evidence of payment. There is no fixed statutory cap, but the Revenue Department can challenge amounts it considers excessive relative to the company’s size and the individual’s role. Payments not tied to genuine services, or structured to distribute profits rather than compensate for work, are at risk of disallowance.

Entertainment and client meals

Entertainment expenses are deductible up to 0.3% of gross revenue or paid-up capital, whichever is higher, with a THB 10 million ceiling per accounting period. To qualify, the expense must relate to entertainment of customers or business contacts, be appropriate to the company’s business and be supported by a tax invoice naming the payee. Spending above the cap, or meals for personal guests without documentation, is not deductible. Companies with frequent client-facing activity should track this category separately throughout the year.

Expenses that are personal in nature, unsupported by documentation or paid to related parties without an arm’s length basis may be disallowed more broadly, making proper classification and record-keeping essential from the start.

Foreign-sourced income for Thai-registered companies

The treatment of foreign-sourced income is a key consideration for Thai-registered companies with overseas operations or international clients. Thailand applies a worldwide basis of taxation, meaning corporate income tax applies to total net profit regardless of where the income arises or whether it is transferred into Thailand.

This differs from the personal income tax rules amended in 2024, under which individual tax residents became liable for foreign-sourced income brought into Thailand on a remittance basis (Departmental Instruction Orders Por.161/2566 and Por.162/2566, effective 1 January 2024). Proposals introduced in 2025 would allow a two-year grace period for such remittances. Neither provision applies to corporate taxpayers. Thai-registered companies are assessed on worldwide net profit under Sections 65 and 66 of the Revenue Code, and the timing of any remittance does not affect the corporate income tax position.

How invoicing overseas clients works in practice

When a Thai-registered company invoices a client outside Thailand, the income forms part of its worldwide profit and is subject to Thai corporate income tax. The client’s location, the currency of payment and where funds are received do not change this. Funds routed through a foreign bank account held by or on behalf of the Thai company are still regarded as the company’s income and do not remove the Thai CIT liability, though such arrangements may attract additional scrutiny where related parties are involved.

Where activities are carried out across jurisdictions through branches or subsidiaries, profit allocation requires careful consideration, including transfer pricing rules and any applicable double taxation agreement. Thailand has entered into more than 60 double taxation agreements, which may allocate taxing rights between jurisdictions, reduce withholding tax rates or provide relief through a foreign tax credit mechanism. Companies with cross-border revenue streams may need to confirm treaty eligibility and obtain a Certificate of Residence to access these benefits.

Tax incentives in Thailand

The Board of Investment (BOI) provides tax incentives for activities within the following categories:

• Agriculture and agricultural products
• Chemicals, paper and plastics
• Electronic industry and electrical appliances
• Light industry
• Mining, ceramics and basic metals
• Metal products, machinery and transportation equipment
• Services and public utilities
• Technology development and innovation

The BOI incentives are classified into two groups, which are group A and group B.

Group A consists of activities that are eligible for corporate income tax incentives, machinery and raw import duty incentives and other non-tax incentives.

Group B consists of activities that receive only machinery and raw materials import duty incentives and other non-tax incentives.

Companies subject to the Pillar Two global minimum tax: BOI-promoted companies with a CIT exemption may still be subject to the QDMTT top-up tax if they are part of an in-scope MNE group and the effective tax rate on Thai profits falls below 15%. BOI incentives and the QDMTT operate under separate frameworks and the interaction between them should be assessed on a case-by-case basis.

Conclusion

Thai corporate income tax applies to the worldwide net profit of companies incorporated in Thailand, and to Thailand-sourced income derived by foreign entities carrying on business in the country. The rate structure is relatively straightforward, with the standard 20% rate applying to most companies and a progressive regime available to qualifying small and medium-sized enterprises.

For businesses with international clients or cross-border revenue, the worldwide basis of taxation means that corporate income tax applies to income earned by a Thai entity regardless of client location, place of receipt or where funds are held. The personal income tax remittance rules introduced in 2024 apply to individuals and do not affect the corporate tax position.

In addition to the rate and filing obligations, the BOI incentive framework and Thailand’s network of double taxation agreements provide meaningful planning opportunities for suitable investments and structures. For cross-border arrangements, early consideration of transfer pricing documentation and treaty analysis is advisable.

How Acclime can help with corporate income tax in Thailand

Acclime Thailand provides end-to-end accounting and tax services for companies operating in Thailand, from bookkeeping and payroll through to CIT return preparation, half-year prepayment filings and liaison with the Revenue Department. For companies with cross-border structures or overseas clients, our tax advisory team can assess the interaction between Thai CIT, applicable double taxation agreements and transfer pricing requirements.

By working with Acclime, you can keep your filings accurate, meet deadlines and address the complexity that comes with operating across borders. Contact us to discuss your corporate tax position and agree on a practical next step.