Thailand corporate tax and VAT: what a company pays
Last updated: 2026-06-14
The main taxes a Thai company deals with: corporate income tax, VAT, and withholding tax, with the rates and the thresholds that decide when each applies.
Corporate income tax
A Thai company pays corporate income tax (CIT) on its net profit. The standard rate is 20%, and most ordinary operating companies pay that flat rate.
Smaller companies get a progressive rate instead. A company with paid-up capital of no more than THB 5 million at the end of the accounting period, and income from goods and services of no more than THB 30 million in the year, qualifies as an SME. It pays 0% on the first THB 300,000 of net profit, 15% on net profit from THB 300,001 to THB 3 million, and 20% on net profit above THB 3 million.
CIT is filed twice a year: a half-year return based on estimated profit, and an annual return after the financial year ends. A company that qualifies for BOI promotion may pay a reduced or zero corporate income tax on the promoted activity for a set number of years.
Value Added Tax (VAT)
VAT applies to most sales of goods and services. The rate is currently 7%. This is a reduced rate that the government extends from time to time; the statutory rate set in the Revenue Code is 10%.
Registration is required once annual turnover passes THB 1.8 million, and the business must register within 30 days of crossing that threshold. A VAT-registered business charges 7% on its sales, can reclaim the VAT it pays on its own purchases, and files a monthly VAT return.
Withholding tax
Thai companies withhold tax at source on many domestic payments and remit it to the Revenue Department. A common rate is 3% on most service fees paid to other Thai companies. The payer issues a withholding certificate to the payee, who credits the amount against their own tax.
Payments to a company abroad that is not carrying on business in Thailand carry a final withholding tax, commonly 15%, and 10% on dividends. A double tax treaty between Thailand and the country where the recipient is based can reduce these rates.
Practical notes
The rates and thresholds here are the standard figures. Reduced rates such as the 7% VAT are extended by Royal Decree periodically, and incentives such as BOI promotion can change the corporate income tax a specific company pays. Confirm the current figures with the Revenue Department or a Thai accountant before relying on them.
Every registered company files an annual audited financial statement and tax return, even in a year with no profit or no activity. Most operators use a Thai accounting firm to handle the monthly filings and the year-end audit.
Frequently asked questions
What is the corporate tax rate in Thailand?
The standard corporate income tax rate is 20%. Qualifying SMEs (paid-up capital up to THB 5 million and revenue up to THB 30 million) pay a progressive rate: 0% on the first THB 300,000 of net profit, 15% up to THB 3 million, and 20% above that.
When does a company have to register for VAT in Thailand?
When its annual turnover passes THB 1.8 million. Registration must be completed within 30 days of crossing the threshold. The VAT rate is currently 7%.
What is the VAT rate in Thailand?
The VAT rate is currently 7%. This is a reduced rate that the government extends periodically; the statutory rate set in the Revenue Code is 10%.
Sources
This page is a plain-English reference. It is not legal advice. For specifics that affect your business, consult a qualified Thai law firm.
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