18 th Annual Tax and Legal Conference Maximise Shareholder Value 2017 www.pwc.com/th Update new tax laws and regulations
Agenda PART I 1. Tax rate update 2. Tax measures to encourage a single bookkeeping 3. Additional tax deductions/other deductions 4. Tax exemptions/tax support 5. Extension of period for filing/requesting refund 6. Personal income tax 7. Other PART II 1. Draft Act to amend the Revenue Code/ Draft of other Acts/ Draft regulations 2. Non-Publicly Accountable Entities (NPAEs) 2
PART I 3
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1. Tax rate update 1.1 Reduction of corporate income tax rate (Act to amend the Revenue Code No.42 dated 3 March 2016) Purpose: To increase the ability of a corporate entity to compete in the economy of the country Reduction of corporate income tax rate: The statutory tax rate permanently reduced from 30% to 20% Effective date: For companies and juristic partnerships with accounting periods commencing on or after 1 January 2016. 5
1. Tax rate update 1.2 SME corporate tax rate (Royal Decree No. 603 dated 18 April 2016) Purpose: To relieve the tax burden and increase financial liquidity of SMEs as well as to increase their ability to compete in the country and attract investment For accounting periods beginning on or after 1 January 2015 but not later than 31 December 2016: Net profit (Baht) Tax rates 0-300,000 Nil Over 300,000 10% 6
1. Tax rate update 1.2 SME corporate tax rate (Royal Decree No. 603 dated 18 April 2016) (Cont d) For accounting periods beginning on or after 1 January 2017: Net profit (Baht) Tax rates 0-300,000 Nil 300,001 3,000,000 15% Over 3,000,000 20% To be eligible for the reduced rates of tax, the SME must meet the following criteria: 1. Paid-up capital on the last day of any accounting period must not exceed THB 5 million, and 2. Income from the sale of goods and provision of services must not exceed THB 30 million in any accounting period. 7
1. Tax rate update 1.3 Reduced rates of personal income tax extended to cover the 2016 tax year (Royal Decree No.600 dated 12 February 2016) Purpose: To relieve the tax burden of taxpayers so as to be aligned with the current economic situation and cost of living Net income (Baht) Tax rates (%) 0-150,000 Exempt 150,001-300,000 5 300,001-500,000 10 500,001-750,000 15 750,001-1,000,000 20 1,000,001 2,000,000 25 2,000,001 4,000,000 30 Over 4,000,000 35 8
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2. Tax measures to encourage a single bookkeeping 2.1 Waiver of tax audits (Royal Ordinance B.E.2558 dated 31 December 2015) Purpose: To encourage companies to comply with the tax law, and to prepare accounting records and financial statements according to the actual status of the business Benefits: Waiver of tax audits and assessments, including criminal fines under the Revenue Code, for companies paying CIT on net profit, in respect of: CIT for accounting periods beginning before Jan 2016 VAT and SBT for tax base occurring before 1 Jan 2016 Stamp duty for instruments executed before 1 Jan 2016 10
2. Tax measures to encourage a single bookkeeping 2.1 Waiver of tax audits (Royal Ordinance B.E.2558 dated 31 December 2015) (Cont d) Conditions: Companies earning revenue not exceeding Baht 500 million in the past full 12-month accounting period which ended on or before 31 Dec 2015 Registration between 15 Jan 2016 and 15 Mar 2016 Tax returns due from Jan 2016 onwards filed and tax paid (if any) Bookkeeping and financial statements in accordance with the actual status of the business for accounting periods beginning on or after 1 Jan 2016 No action must be taken from 1 Jan 2016 onwards that indicates an evasion of tax 11
2. Tax measures to encourage a single bookkeeping 2.2 Evidence for borrowing from the banks (Royal Ordinance B.E.2558 dated 31 December 2015) With effect from 1 Jan 2019 The Ministry of Finance and the Bank of Thailand will perform necessary action to instruct commercial banks to use the accounting records and financial statements filed with the Revenue Department as evidence for processing financial transactions and requesting banking facilities 12
2. Tax measures to encourage a single bookkeeping 2.3 Tax exemption or reduction for SME enterprises (Royal Decree 595 dated 30 December 2015) Benefits: Granted to SMEs established before 1 Jan 2016 For accounting periods beginning between 1 Jan 2016 and 31 Dec 2016: All net profit exempt from CIT (over 300,000 at 10%) 13
2. Tax measures to encourage a single bookkeeping 2.3 Tax exemption or reduction for SME enterprises (Royal Decree 595 dated 30 December 2015) (Cont d) Benefits: For accounting periods beginning between 1 Jan 2017 and 31 Dec 2017: Net profit (Baht) Tax rates 0-300,000 Nil Over 300,000 10% 14
2. Tax measures to encourage a single bookkeeping 2.3 Tax exemption or reduction for SME enterprises (Royal Decree 595 dated 30 December 2015) (Cont d) Benefits: For accounting periods beginning on or after 1 Jan 2018: Net profit (Baht) Tax rates 0-300,000 Nil 300,001 3,000,000 15% Over 3,000,000 20% 15
2. Tax measures to encourage a single bookkeeping 2.3 Tax exemption or reduction for SME enterprises (Royal Decree 595 dated 30 December 2015) (Cont d) Conditions: To be eligible for the tax exemption and reduced rates of tax, the SME must meet the following criteria: 1. Paid-up capital on the last day of any accounting period must not exceed THB 5 million. 2. Revenue from the sale of goods and provision of services must not exceed THB 30 million in any accounting period. 3. Registration as an operator according to the above Royal Ordinance B.E. 2558 dated 31 December 2015 4. The waiver of a tax audit according to the above Royal Ordinance must not have been revoked. 16
2. Tax measures to encourage a single bookkeeping 2.4 Withholding tax still required on payments to SMEs (Clarification of the Revenue Department No. 4, dated 11 April 2016) SMEs which registered for the waiver of tax audit SMEs obtain CIT tax exemption for the accounting period beginning between 1 Jan and 31 Dec 2016 WHT still required for payments subject to WHT to these SMEs Tax refund 17
2. Tax measures to encourage a single bookkeeping 2.5.1 Extension of period granted for filing additional VAT returns (Clarification of the Revenue Department No. 2, dated 16 March 2016) Granted to companies which registered for the waiver of tax audit in order to correct tax filing in the past Benefits: VAT returns for the tax months from Jan 2015 to Mar 2016 Extension for additional filing to 30 Jun 2016 without penalty and surcharge 18
2. Tax measures to encourage a single bookkeeping 2.5.2 Extension of period granted for filing monthly tax returns for all types of tax (Clarification of the Revenue Department No.3, dated 23 March 2016) Benefits: Monthly tax returns for all types of tax for the tax months from Jan 2015 to Mar 2016 Extension for additional filing to 30 Jun 2016 without penalty and surcharge WHT tax returns, reverse charge VAT returns, SBT returns, stamp duty returns 19
2. Tax measures to encourage a single bookkeeping 2.6 Conditions of CIT returns required to be filed (Clarification of the Revenue Department No.5, dated 22 June 2016) For accounting period ending 31 Dec 2015 Companies which registered for the waiver of tax audit Failed to file CIT returns by 29 May 2016 CIT return required to be filed by 31 August 2016 with penalty and surcharge 20
2. Tax measures to encourage a single bookkeeping 2.6 Conditions of CIT returns required to be filed (Clarification of the Revenue Department No.5, dated 22 June 2016) (Cont d) For accounting period beginning between 1 Jan and 31 Dec 2015 Companies which registered for the waiver of tax audit Failed to file CIT returns Due date for filing CIT returns - same as halfyear CIT return of following accounting period, with penalty and surcharge (+ 3 months) 21
2. Tax measures to encourage a single bookkeeping 2.7 Conditions of Accounts and financial statements required to be in line with the actual circumstances of the business (Clarification of the Revenue Department No. 6, dated 9 August 2016) Companies which registered for the waiver of tax audit Incorrect accounting records found after filing 2015 audited financial statements with the DBD Requirements - Amend 2015 accounting records to be in line with the actual circumstances - Revised financial statements to be signed by CPA and re-filed with the DBD 22
2. Tax measures to encourage a single bookkeeping 2.8 Additional deduction of hiring students who currently study accounting (Royal Decree No.607 dated 11 May 2016) Purpose: To promote SMEs to prepare bookkeeping correctly Benefits: Double deduction granted to SMEs for expenses relating to the hire of students who currently study accounting for handling accounting matters Eligible accounting periods: Accounting periods commencing on or after 1 January 2016 until 31 December 2018 (3 years) SME means companies or juristic partnerships established under Thai law that have fixed assets, excluding land, with a value of not more than THB 200 million and no more than 200 employees 23
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3. Additional tax deductions/other deductions 3.1 Donations to educational institutions (Royal Decree No. 616 dated 30 June 2016) Purpose: To continue promotion of education support Benefits: Extension of period of double deduction for donations to educational institutions (either public or private sector) Exemption from income tax, VAT, SBT and stamp duty on proceeds from transfer of property or instruments executed in respect of such donations (cost of property may not be included as a tax deductible expense) Granted to: Individuals or corporate entities Period: 1 January 2016 to 31 December 2018 25
3. Additional tax deductions/other deductions 3.2 Donations to sport organizations (Royal Decree No. 596 dated 25 January 2016) Purpose: To continue promotion of sports support Benefit: Extension of period of double deduction for donations to sports organizations Exemption from income tax, VAT, SBT and stamp duty on proceeds from transfer of property or instruments executed in respect of such donations (cost of property may not be included as a tax deductible expense) Granted to: Individuals or corporate entities Period: 1 January 2016 to 31 December 2018 26
3. Additional tax deductions/other deductions 3.3 Research and development (Royal Decree No. 598 dated 12 February 2016, effective from 25 February 2016) Purpose: To promote R&D and innovation which will benefit the economic development and increase the ability to compete in the country. Benefit granted to corporate entities (300% deduction) Expenditure on R&D for technology and innovation paid to government or private sector Additional 100% deduction granted A further 100% deduction will be granted if the expenditure is paid from 1 Jan 2015 to 31 Dec 2019 with certain threshold amounts depending on the revenue of the company (6%-60% of revenue) May not be used in a business subject to tax exemption under investment promotion law, either partly or wholly, if the benefits under RD 598 are used. 27
3. Additional tax deductions/other deductions 3.4 Investment in new assets (Royal Decree No. 604 dated 18 April 2016, Royal Decree No.622 dated 24 August 2016) Purpose: To promote investment in the country so as to benefit the economy in the short-term and to increase the ability to compete in the country over the long-term Benefits: 100% additional deduction for investment in new assets If The additional deduction must be averaged equally over each accounting period. P/O, purchase agreement, application for construction, etc. - dated between 3 Nov 2015 and 31 Dec 2016 Payment made between 3 Nov 2015 and 31 Dec 2016 Assets ready for use between 3 Nov 2015 and 31 Dec 2016 except for machinery and permanent buildings that may be ready for use after 31 Dec 2016 28
3. Additional tax deductions/other deductions 3.4 Investment in new assets (Royal Decree No. 604 dated 18 April 2016, Royal Decree No. 622 dated 24 August 2016) (Cont d) Eligible assets: Type of asset 1. Machinery, components, equipment, tools, furniture and fixtures Number of accounting periods to be used for the additional deduction 5 2. Computer programs 3 3. Registered vehicles under the law, excluding passenger cars with not more than 10 seats which are not acquired for use in a leasing business (cars used in leasing business can use this benefit.) 4. Permanent buildings, excluding land and permanent buildings used for residential purposes 5 20 29
3. Additional tax deductions/other deductions 3.5 Expenses paid for domestic seminars and training (Royal Decree No.611 dated 19 May 2016, DG Notification No.267) Purpose: To continue promotion of domestic travel so as to benefit the economy and to assist operators in the travel business Benefits: Extension of period of double deduction for expenses for seminar rooms, accommodation, transportation and other expenses related to domestic seminars and training for employees or expenses for such seminars and training paid to tourism operators under the law Granted to: Corporate entities Eligible period: 1 January 2016 to 31 December 2016 30
3. Additional tax deduction /other deductions 3.6 Donations to various cultural funds (Royal Decree No.615 dated 30 June 2016) Purpose: To promote learning, maintenance of religion, arts and culture and to attract donors for these funds Benefits: Double deduction granted for donations to Safe and Creative Media Development fund and funds relating to art, culture, archives and archaeology, with a limit on the amounts deductible Granted to: Individuals and corporate entities Effective date: 6 July 2016 31
3. Additional tax deductions/other deductions 3.7 Donations to the Technology Development Fund for Education (Royal Decree No.619 dated 1 August 2016) Purpose: To attract donors for the Technology Development Fund for Education which is of benefit to the education and learning of Thai people Benefits: Deduction for donations to the Technology Development Fund for Education established by the Ministry of Education, with a limit on the amount Granted to: Individuals and corporate entities Effective date: 6 August 2016 32
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4. Tax exemptions/tax support 4.1 SBT exemption for treasury management (Royal Decree No. 612 dated 31 May 2016) Purpose: To encourage multinational companies to set up more IHQs in Thailand Previously, SBT exemption was granted to qualified IHQs only on interest received from loans to the associated enterprises according to Royal Decree No. 586 dated 28 April 2015. New Benefits: To extend the tax base for SBT exemption for qualified IHQs to be all remuneration received from treasury management services provided to associated enterprises Effective date: From 2 May 2015 34
4. Tax exemptions/tax support 4.2 Tax exemption for conversion of property fund to Real Estate Investment Trust (REIT)(Royal Decree No. 599 dated 12 February 2016) Purpose: To promote investment in property through REIT instead of property funds Benefits: Exemption from income tax for unit holders of property funds on income from the conversion of investment units to REIT trust certificates Exemption from VAT, SBT and stamp duty for property funds for the transfer of property due to the conversion to REIT Effective date: Between 25 February 2016 and 31 December 2016 35
4. Tax exemptions/tax support 4.3 Tax support for target activities using technology as the basis for the production process and services approved by the NSTD Purpose: To promote target activities that use technology as the basis for the production process and services 4.3.1 Benefits for SME operators (Royal Decree No. 602 dated 18 April 2016) CIT exemption granted to SME on profit derived from 10 target activities approved by the NSTD for five accounting periods under prescribed conditions SME must meet the following criteria: 1. A company or juristic partnership must be established between 1 October 2015 and 31 December 2016 including obtains approval from the Director General of the Revenue Department. 2. Paid-up capital on the last day of any accounting period must not exceed THB 5 million, and 3. Revenue from the sale of goods and provision of services must not exceed THB 30 million in any accounting period. 36
4. Tax exemptions/tax support 4.3 Tax support for target activities using technology as the basis for the production process and services approved by the NSTD (Cont d) 4.3.2 Benefits for venture capital (Royal Decree No. 597 dated 10 February 2016) CIT exemption granted to venture capital companies for ten accounting periods on: Dividends derived from an operating company performing target activities Gain on the transfer of shares in an operating company that earns at least 80% of its income from target activities Operating Company Thai company doing target activities and not listed in the SET 37
4. Tax exemptions/tax support 4.3 Tax support for target activities using technology as the basis for the production process and services approved by the NSTD (Cont d) 4.3.3 Benefits for shareholders and unit holders in venture capital trust (Royal Decree No. 597 dated 10 February 2016) PIT and CIT exemptions granted for ten accounting periods To Individual/corporate shareholders or unit holders of venture capital company or private equity trust Dividends Gain on transfer of shares/trust units Gain on dissolution of venture capital company/private equity trust 38
4. Tax exemptions/tax support 4.3 Tax support for target activities using technology as the basis for the production process and services approved by the NSTD (Cont d) 10 Target activities: Food and agriculture Energy saving, energy replacement and clean energy Bio-technology base Medical and public health Tourism, services and creative economics Advanced materials Textiles, clothes and accessories Vehicles and parts Electronics, computers, software and information technology services Research, development and innovation or new industries 39
4. Tax exemptions/tax support 4.4 Tax exemption granted to social enterprises, investors and donators (Royal Decree No. 621 dated 24 August 2016) Purpose: To promote social enterprises so as to raise the quality of life of the people and to assist the private sector in coordinating with the government to project the community and society 4.4.1 Benefits of qualified social enterprises: Corporate tax exemption on net profit If All the net profits of each accounting period must be reinvested or used for the benefit of farmers, the poor, the disabled or for other public benefit. and No dividend or any deemed income from reduction of capital can be paid to shareholders or partners out of the profit. 40
4. Tax exemptions/tax support 4.4 Tax exemption granted to social enterprises, investors and donators (Royal Decree No. 621 dated 24 August 2016) 4.4.2 Benefits of corporate entities investing in qualified social enterprises: Tax deduction in the amount equal to the investment in ordinary shares 4.4.3 Benefits for donations to qualified social enterprises: Tax deduction for donations in cash or kind, subject to limitation of amounts deductible The above two benefits are under condition that the qualified social enterprises can pay dividend to shareholders or partners not exceeding 30% of net profit of each accounting period. 41
4. Tax exemptions/tax support 4.5 Debt restructuring (Royal Decree No. 623 dated 30 August 2016) Purpose: To promote debt restructuring of financial institutions under the criteria of the Bank of Thailand (continued from RD No. 581) Benefits: Tax exemption granted to debtors of financial institutions for income from the debts forgiven by the financial institutions which have executed the debt restructuring under the criteria of the Bank of Thailand from 1 January 2015 42
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5. Extension of period for filing/requesting refund 5.1 CIT filing for BOI companies with multiple promoted projects (BOI net-off issue) (Order of the National Council for Peace and Order No. 45/2559 dated 29 July 2016) Benefits Extension to 15 August 2016 with no penalty and surcharge for: Granted to: - CIT filing - Request for refund of penalty and surcharge BOI companies with multiple promoted projects which failed to compute income and expenditure of all promoted projects using net off method as required by the Board of Taxation Decision no. 38/2552, including those whose case was final. 44
5. Extension of period for filing/requesting refund 5.2 Stamp duty refund (Clarification of the Revenue Department dated 25 July 2016) Benefits Extension to 1 August 2016 for claiming a stamp duty refund Conditions Instruments executed between 5 April 2015 and 31 January 2016 requiring stamp duty to be paid in cash, but stamp duty was already affixed Refund can be claimed only if the stamp duty has been correctly paid in cash. 45
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6. Personal income tax 6.1 Tax deduction for purchase of first residence (Ministerial Regulation No. 313 dated 5 February 2016) Purpose: To relieve tax burden for taxpayer who buys a residence within December 2016 Benefits: Amount paid for purchase of a house with land or a condominium unit as a residence Value of property 3 million Baht A deduction of 20% for five tax years same amount for each year 47
6. Personal income tax 6.2 Contribution to the National Savings Fund (Ministerial Regulation No. 314 dated 11 April 2016) Purpose: To encourage savings for security of the aged who do not obtain benefit from the government Benefits: Actual contribution paid to the National Savings Fund granted as allowance for personal income tax, subject to a maximum of Baht 500,000 The contribution to a National Savings Fund, a registered provident fund, a retirement mutual fund or a qualified pension life insurance premium - either one fund or several funds allowance subject to a maximum of Baht 500,000 in total for each tax year Income tax exemption for benefit obtained from the National Savings Fund as a result of reaching the age of 60, becoming incapacitated or death Effective date: For assessable income from 2015 onwards 48
6. Personal income tax 6.3 Extension of tax deduction for investments in LTF (Ministerial Regulation No. 317 dated 28 June 2016) Purpose: To encourage people to invest on a long-term basis and maintain the stability of the Securities Exchange of Thailand Benefits: Investment in long-term investment fund (LTF) allowed for tax deduction up to 15% of assessable income received which is subject to income tax, with a maximum of Baht 500,000 in any tax year Gain from redemption of investment units in the above LTF exempted from income tax LTF must be held for at least seven calendar years, except in case of incapacity or death Eligible periods: 1 January 2016 to 31 December 2019 49
6. Personal income tax 6.4 Deduction for expenses on domestic travelling and hotels (Ministerial Regulation No. 316 dated 17 June 2016) Purpose: To continue the promotion of domestic travel so as to benefit the economy of the country and assist tourism operators Benefits: Deduction of up to Baht 15,000 granted for domestic travel and hotel expenses Eligible period: 1 January 2016 to 31 December 2016 50
6. Personal income tax 6.5 Deduction for spending on OTOP products (Ministerial Regulation No. 318 dated 29 July 2016) Purpose: To promote OTOP products Benefits: Deduction of up to Baht 15,000 granted for amounts paid to operators of registered One Tambol One Product (OTOP) businesses (Operator must have registered for VAT) Eligible period: Between 1 and 31 August 2016 51
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7. Other 7.1 Prototype cars or motorcycles for R&D and testing Purpose: To increase competition potential in the motor vehicle industry in the country and attract investment to make Thailand the centre of R&D and testing of prototype vehicles in the region 7.1.1 Benefits VAT exemption (Royal Decree No. 613 dated 10 June 2016) VAT exemption granted on import of prototype cars or motorcycles for R&D and testing which are approved to be exempted from excise tax under the law Effective date: 1 January 2016 Importers being approved by the Director-General of the Excise Department to carry on R&D or testing of vehicles 53
7. Other 7.1 Prototype cars or motorcycles for R&D and testing (Cont d) 7.1.2 Benefits Depreciation of prototype cars (Royal Decree No. 620 dated 1 August 2016) Total cost of prototype cars allowed to be the base for depreciation (not limited to Baht 1 million) Effective date: Prototype cars used for research, development or testing and approved to be exempted from excise tax under the law The prototype cars must be acquired from 1 January 2016 onwards. 54
7. Other 7.1 Prototype cars or motorcycles for R&D and testing (Cont d) 7.1.3 Benefits No VAT on prototype cars or motorcycles produced (Notification on VAT No.210) No VAT imposed on prototype cars or motorcycles produced to businesses carrying on research, development or testing which obtain approval from the Director-General of the Excise Department Prototype cars or motorcycles used for research, development or testing and approved to be exempted from excise tax under the law Effective date: 1 January 2016 55
7. Other 7.2 Bad debts written off need not follow procedures under Ministerial Regulation No. 186 7.2.1 Ministerial Regulation No. 319 dated 3 August 2016 Benefits: Bad debts written off are tax deductible without the need to follow the procedures under MR 186 under conditions. Bad debts written off by non-life insurance company for re-insurance compensation due from the flooding in Thailand from 1 July to 31 December 2011 Effective date: Accounting periods beginning on or after 1 January 2011 56
7. Other 7.2 Bad debts written off need not follow procedures under Ministerial Regulation No. 186 (Cont d) 7.2.2 Debt restructuring (Ministerial Regulation No. 321 dated 12 September 2016) Benefits: Bad debts written off are tax deductible without the need to follow the procedures under MR 186 under conditions. Bad debts written off by financial creditors due to debt restructuring framework prescribed by the Bank of Thailand executed from 1 January 2015 57
7. Other 7.3 Amendment of certain criminal punishments under the Revenue Code (The Revenue Code Amendment Act No.41 dated 10 Feb 2016) Purpose: To cover certain criminal offences and increase the punishment rate to be appropriate Effective date: 25 February 2016 Sectio n Previous punishment 35 For only late filing of CIT return under sec. 17, fine under Sec 35 is not exceeding Bht 2,000. 37, 90/4(6) To give false statement, fraud, deception or any other similar method to evade tax payment is subject to imprisonment from three months to seven years and fine of Baht 2,000 to Baht 200,000 37 bis Intentionally failure to file a return with a view to evading payment of tax and duty is subject to fine of not exceeding Baht 5,000 or imprisonment not exceeding 6 months or both Amendment To add fine of not exceeding Bht 2,000 under sec. 35 for not filing documents necessary to compute CIT together with the audited financial statements under Sec 69 (Total fine of not exceeding Bht 4,000) To include the request for tax or VAT refund To increase punishment: fine of not exceeding Baht 200,000 or imprisonment not exceeding one year or both 58
7. Other 7.4 Method and due date for stamp duty to be paid in cash for certain instruments (Notification re: stamp duty No. 55 dated 26 August 2016) Method and due date: 7.4.1 Stamp duty must be paid in cash within 15 days from the date on which certain instruments are executed in Thailand Instruments in this category include the following: Lease of land, buildings, other construction or floating rafts with rental of THB 1 million or more Hire of work agreement with remuneration of THB 1 million or more 59
7. Other 7.4 Method and due date for stamp duty to be paid in cash for certain instruments (Notification re: stamp duty No. 55 dated 26 August 2016) (Cont d) Method and due date: 7.4.2 Stamp duty paid in cash twice a month: 1. By the 22 nd of the month for instruments executed during the first half of the month. 2. By the 7 th of the following month for instruments executed during the second half of the prior month. Instruments in this category include the following: Hire-purchase of property for lessors who are juristic persons, financial institutions or operators of personal loan business under supervision Suretyship for which a financial institution (excluding insurance company) is a party to the contract Loan of money or agreement for bank overdraft 60
7. Other 7.4 Method and due date for stamp duty to be paid in cash for certain instruments (Notification re: stamp duty No. 55 dated 26 August 2016) (Cont d) Method and due date: 7.4.3 Stamp duty must be paid in cash on the registration date for the following instruments: Receipt issued in connection with a sale, sale with right of redemption, hire-purchase or transfer of ownership of a vehicle registered under the law, whereby both the seller and the hire-purchaser of the vehicle are juristic persons. Used vehicles are not included in this regulation. 61
7. Other 7.5 Real estate development business (Taw Paw 262/2559, effective date 31 August 2016) Publicly Accountable Entity (PAE) NPAE Subsidiary of PAE Other NPAE Previous method GAAP Contract, installment or percentage of completion Contract, installment or percentage of completion New method GAAP GAAP Contract, installment or percentage of completion 62
PART II 63
1. Draft Act to amend the Revenue Code/ Draft of other Acts/Draft regulations Cabinet resolution Subject 13 Sep 2016 7% VAT rate extension for one more year from 1 October 2016 until 30 September 2017 23 Aug 2016 To amend the Investment Promotion Act, Drafts of Special Economic Zone Act, Draft of Act regarding increasing the ability of target industries to compete in Thailand 9 Aug 2016 Tax measures to promote individuals operating a business as a juristic person 2 Aug 2016 -To amend the Revenue Code for e-tax filing, e-withholding tax, e-tax invoices and receipts and electronic information remittance (E-payment plan) -Double deduction for expenses to support SME and investment in rural areas 26 July 2016 Deposits with nature similar to life insurance can be claimed as an allowance in PIT computation 12 July 2016 Extension of tax reduction (0.1% - 3%) for business operators located in specific development zones (Narathiwat, Pattani, Yala and part of Songkha) for three years from 1 January 2018 to 31 December 2020 and double deduction of the CCTV costs in these zones 64
1. Draft Act to amend the Revenue Code/Draft of other Acts/Draft regulations (Cont d) Cabinet resolution Subject 7 June 2016 Draft of Land and House Tax law so as to replace House and Land Tax Act B.E. 2475 including Local Development Act B.E.2508 10 May 2016 To amend Sec 41 bis (transferor is taxpayer) to be consistent with Sec 42(26), (27): Parent as transferor of ownership or possessory right in immovable property without remuneration is exempt from tax on the portion of income not exceeding Baht 20 million for each legitimate child. 26 Apr 2016 Anti-tax evasion and fraud according to the Financial Action Task Force (FATF) temporarily seize and attach property, treated as AML offence, etc 19 Apr 2016 Restructure of Personal income tax: tax rates, tax allowances and deductions, minimum annual income required for filing personal income tax return 1 Mar 2016 Law on international coordination for exchange of information for tax collection purposes 7 May 2015 Draft of transfer pricing law 65
2. Non-Publicly Accountable Entities (NPAEs) NPEs Complex NPAEs Apply full set of TFRS for SMEs TAS 12 extensions to 2019 Non-complex NPAEs Adopt only part of TFRS for SMEs No TAS 12 66
2. Non-Publicly Accountable Entities (NPAEs) (Cont d) Complex NPAEs PAEs NPAEs NPAEs PAEs NPAEs NPAEs Associate company, Subsidiary, Joint venture Associate company, Subsidiary, Joint venture Associate company, Subsidiary, Joint venture 67
Contact Somsak Anakkasela Partner Tel: +66 (0) 2344 1253 somsak.anakkasela@th.pwc.com 68
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