Thailand Capital Expenditure Corporate Tax Concession
On 10 July 2017, Royal Decree (No 642) was gazetted, extending the capital expenditure corporate tax deduction concession for another 1 year period of time from 01 Jan 2017 to 31 Dec 2017. This Tax Insight has been updated to reflect the tax deduction concessions prescribed in Royal Decree (No 642).
The Corporate Tax Deduction Concession
An exemption from corporate income tax (i.e. a corporate tax deduction) for expenditure incurred on additions, alternations, extensions and/or improvements of property, plant and equipment assets (which assets are not normally permitted as expenses under Section 65 ter (5) of the Revenue Code, but which are permitted depreciation allowance claims under Section 65 bis (2) of the Revenue Code), as follows:
(1) As prescribed in Royal Decree (No 604) issued on 18 April 2016.
(2) As prescribed in Royal Decree (No 642) issued on 09 July 2017.
The types of property, plant and equipment assets that qualify for this tax concession are as follows:
Rules and Conditions
The rules and conditions prescribed in Royal Decree (No 604) for this tax concession are as follows:
Applicable Fiscal Years Over Which the Tax Concession Shall be Claimed
The applicable fiscal years over which the tax deduction concession is allowed (shall be claimed) are as follows (3):
(3) As prescribed in Director-General's Notification on Income Tax (No 266) issued on 17 May 2016.
The Royal Decrees also prescribes that in the event of a claimant failing to comply with any of the rules, procedures and conditions, rights to the tax concession shall cease, and the amounts of the tax deduction concessions claimed shall be re-computed as income for the years the tax deductions concessions were claimed.
This Tax Insight is general information only. It should not be used to determine any particular matter without consulting with an experienced Thailand tax advisor.