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Attractive Corporate Income Tax Exemptions For BOI Companies

29 Jul Attractive Corporate Income Tax Exemptions For BOI Companies

The Board of Investment of Thailand promotes certain business projects by offering attractive Corporate Income Tax exemptions. Only the income derived from the business promoted by the BOI is exempted...
Crisis on traditional sources of energy

24 Mar Crisis On Traditional Sources Of Energy

Since the early controlled handle of fire by Homo Erectus more than 400,000 years ago, the history of humanity has been a tenacious struggle between men and women seeking to regulate and generate sour...
PPP and Civil Construction Projects in Thailand (Newletter March 2016 Part 5)

24 Mar PPP and Civil Construction Projects in Thailand (Newletter March 2016 Part 5)

5 planned mega infrastructure projects (rail and highways) expected to cost about Bt334 billion might be considered for Public Private Partnerships Fast-Track scheme, one of them is the Bt152-billion ...
Regulatory Framework For Accounting in Thailand

Regulatory Framework For Accounting in Thailand

Accounting looks at the heart of each and every business. Financial Statements serve as a crucial source of information for business owners, managers, directors, business partners, investors, creditors and the Revenue Department for calculating the income tax. A modern regulatory framework for accounting is important for foreign investors. According to the World Bank’s report on the Observance of Standards and Codes, Thailand has made great progress in this field. The Thai Accounting standards closely follow international standards (IFRS). This article outlines the regulatory framework for accounting in Thailand.

The following business entities have to keep accounts according to the Thai Accounting Act, B.E. 2543 (here called the Act):

  • Registered partnerships registered under Thai law,
  • Limited Companies registered under Thai law,
  • Public Limited Companies registered under Thai law,
  • Juristic Persons registered under a foreign law if carrying on business in Thailand,
  • Joint Ventures under the Thai Revenue Code, and
  • Natural Persons or Unregistered Partnerships engaging in any kind of business in Thailand as prescribed.

Regulatory Framework For Accounting in Thailand

According to Section 20 of the Act the above business entities must have a qualified bookkeeper (see below) who keeps accounts which must show results of the operations, financial status or changes in financial status in accordance with the facts and accounting standards. According to Section 21 of the Act particulars must be entered in Thai language or accompanied by a translation into Thai language.

According to Sections 9, 10 and 11 of the Act a business must prepare and submit financial statements to the Accounts Office within five months from the day the accounts are closed, but in the case of a limited company or a public limited company registered under Thai law within one month from the day of the general meeting approving such financial statements. The books are closed (end of accounting period) twelve months after the commencement of the accounting period which begins either with the registration date (Thai company or Registered Partnerships) or the date of start of business operations (Joint Ventures and foreign companies).

Additionally, a tax return must be filed together with a balance sheet, operating account and profit and loss account, revenue and expense account on gross revenue within 150 days from the last day of the accounting period according to Section 69 of the Thai Revenue Code, B.E. 2481. These financial statements are the basis for the calculation of the Corporate Income Tax according to Section 65 of the Revenue Code. The financial statement for the Revenue Department might differ from the financial statements under the Accounting Act where prescribed by the law.

The accounting professions in Thailand and their code of ethics are governed by the Accounting Professions Act B.E. 2547 and self-regulated by the Federation of the Accounting Professions (FAP) which also issues the license for the Certified Public Accountants (CPA). The FAP is a member of the International Federation of Accountants. The Department of Business Development (DBD) of the Ministry of Commerce and the Securities Exchange Commissions (SEC) are the competent regulators for accounting and the accounting professions.

When speaking about accountants in Thailand these can be either simple book keepers or (if fulfilling additional qualifications) auditors. Accountants in Thailand must hold a bachelor’s degree in accountancy. Auditors must hold a license as Certified Public Accountants. Both types of accountants, book keepers and auditors, must be members in the FAP. Juristic Persons who offer accounting and auditing services must be registered with the FAP as well. Juristic Persons must even provide a collateral for malpractice liability.

The FAP also issues the Thai Accounting Standards which are closely based on the International Accounting Standards. The ASEAN member states are currently in the process of mutually recognizing and liberalizing the accounting professions in the wake of the ASEAN Economic Community (AEC).

Juslaws & Consult is a competent partner for all questions regarding the regulatory framework for accounting in Thailand and the whole ASEAN region. We can also effectively communicate with company headquarters and mother companies abroad as our international team speaks their language when it comes to accounting question.

Please contact our Bangkok office for further information at support@juslaws.com

 

Christian Moser, Senior Associate at Juslaws & Consult

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