Double Tax Treaties in Thailand

Updated on Tuesday 19th July 2016

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Thailand has signed various “Agreements of the Avoidance of Double Taxation”, also known as double tax treaties, with numerous countries. The aim of these treaties is to avoid a company from a certain country to be taxed twice on income earned in the other country.
 

What are double tax treaties in Thailand?


The double tax treaties in Thailand ensure that ordinary income gained in a country by a company which does not have an important presence in that country is exempt from taxes within that country. In case that company does not have an important presence (a permanent establishment) in the country where the income was gained, the tax remunerated in that country is considered a credit against any taxation that could be owned in the country of origin of the company.

Double tax treaties in Thailand also apply to persons who deliver services in the other country.
 

Double tax treaties concluded by Thailand


Thailand is party in double tax treaties with over 40 different countries.

In 2013, Thailand had double tax treaties with the following countries: Australia, Austria, Bangladesh, Belgium, Canada, China, Czech Republic, Denmark, Finland, France, Germany, Hungary, Italy, India, Indonesia, Israel, Japan, Luxembourg, Laos, Malaysia, Mauritius, Nepal, Netherlands, New Zealand, Norway, Oman, Pakistan, Philippines, Poland, Romania, Russia, Seychelles, Singapore, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Taiwan, Turkey, Ukraine, United Arab Emirates, U. K., U.S., Uzbekistan, Vietnam.

And in the same year, the country was negotiating other double tax treaties with Belarus, Egypt, Estonia, Ireland, Kenya and Mongolia. Our Thai company formation advisers can provide more information on this matter.
 

Permanent establishment in Thailand


The particular terms of the double tax treaties in Thailand differ, however they have certain common features. The permanent establishment (PE) in Thailand is one of them, representing an essential element in studying the impact of a double tax treaty on the income of a foreign company gained in Thailand. Generally, the existence of a PE is established depending on the fact that the business has a permanent place of business in Thailand. The treaties commonly enlist examples of what could be considered a permanent place of business.

The issues enlisted according to the double tax treaties in Thailand are quite complex. Therefore, it is crucial to seek the advice from company formation professionals in Thailand when studying the impact of such treaties on a foreign business or an individual’s undertakings in this country. Please contact us if you need to know more.

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