On 18 Oct 2005, Thailand Tax Royal Decree (No 437) was gazetted, providing corporate tax deduction concessions for staff education and training costs.

Royal Decree (No 437) is issued under the Government's encouragement of corporate entities to send their staff to receive education and skills training.

A summary of the important prescriptions in Royal Decree (No 437) follows:

The Tax Deduction Concessions Under RD (No 437)

Applicability

From 19 October 2005 onward.

Staff Education Costs

For the costs of educating employees at educational institutions or vocational educational establishments:

• An additional 100% exemption from tax (a double (200%) corporate tax deduction concession) for the costs incurred.

Staff Training Costs

For the costs of training employees at skills development training centers:

• An additional 100% exemption from tax (a double (200%) corporate tax deduction concession) for the costs incurred.

Pre-Employment Training Costs

For the costs of pre-employment skills development training for the benefit of the business:

• An additional 100% exemption from tax (a double (200%) corporate tax deduction concession) for the costs incurred.

The Rules, Procedures and Conditions

The rules, procedures and conditions prescribed in the Royal Decree (No 437) are that:

1. Corporate entities claiming the tax concession for staff education costs shall comply with the rules, procedures and conditions prescribed by the Finance Minister, and
2. Corporate entities claiming the tax concession for staff training costs and pre-employment training costs shall comply with the rules, procedures and conditions prescribed by the Director-General of Revenue.

Caution

If the Revenue Department's tax audit officers find any of the rules procedures or conditions have not been met, the entitlement to the concession may be lost and back-taxes plus penalty and surcharge could be payable.

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