Thailand Tax Investigations (Tax Audits) Under Summons
Update | March 2017
On 15 March 2017, Thailand's Board of Taxation issued Ruling No 41/2560, that makes it clear, tax audit officers only have the power to issue Summons for tax Investigations for no longer than the 5 previous financial years. This Tax Insight has been updated for the Board of Taxation's Ruling.
Section 19 of Thailand's Revenue Code prescribes that when a tax audit officer has reason to believe that false or inadequate information has been reported in a tax return that has been filed, the tax audit officer has the power to issue a summons requiring the taxpayer or witness to appear for providing statements, accounting records, documents or other evidence for investigation for the 2 previous fiscal years, or for the 5 previous fiscal years when the tax audit officer has evidence or reason to believe that the taxpayer had intention to evade tax.
But in addition to the above words, Section 19 also contains a proviso (in favor of the audit officers) that the 2 and 5 previous fiscal year periods are subject to fiscal year periods "as may be extended or postponed by the Finance Minister".
As the statute of limitations period (under Thailand's Civil and Commercial Code) is expiring at the end of March 2017 for action against the taxpayer(s) involved in the Ample Rich Tax Case (see our Share Transfer Benefits Tax Insight), the Revenue Department asked the Board of Taxation whether the Minister of Finance has the power under Section 3 octo of the Revenue Code to extend the 5 previous fiscal year periods for the Revenue Department to issue a summons under Section 19 of the Revenue Code.
At it's Meeting No 46/2560 on 7 March 2017, the Board of Taxation ruled that as Section 3 octo is a general provision (not a specific provision) and that it deals with tax returns to be filed (not tax returns that have already been filed), Section 3 octo is not applicable for extending or postponing the 5 previous fiscal years period as prescribed in Section 19 of the Revenue Code.
This Board of Taxation Ruling makes it clear that the tax audit officers only have the power to issue a Summons for tax Investigations in Thailand for no longer than the 5 previous years as prescribed in Section 19.
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.