Thailand Summons Tax Investigations under Section 19
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 prescribed in Section 19.
Section 19 of Thailand's Revenue Code prescribes that when a tax audit officer has reason to believe that false or incorrect information has been reported by a taxpayer in a tax return that has been filed, the tax audit officer has the power to issue a summons to the taxpayer, requiring the taxpayer 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 reason to believe the taxpayer intended to evade tax.
But in addition to the above words, Section 19 contains a proviso that the 2 and 5 previous fiscal year periods are subject to fiscal year periods "as may be extended or postponed by the Minister of Finance".
As the 10 years statute of limitations period (under Thailand's Civil and Commercial Code) was expiring at the end of March 2017 for action against the taxpayer 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 had the power (under Section 3 octo of the Revenue Code) to extend the 5 previous years period in order for the tax audit officers 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), which deals with tax returns to be filed (not tax returns that have already been filed), it is not applicable for extending or postponing the 5 previous years period prescribed in Section 19 of the Revenue Code.
This Board of Taxation Ruling makes it clear the tax audit officers in Thailand only have the power to issue a Summons for tax Investigations of tax returns that have already been filed 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.