Thailand Tax Penalties and Surcharges
Penalties are paid when a taxpayer fails to meet a required obligation of the law. The rates of penalties are percentages of the amount of the shortfall resulting from the failure to meet the obligation (such as 100% or 200% of the tax shortfall amount).
Thailand Revenue officers are empowered to reduce the prescribed rates of penalties, but in order to do so they are required to be provided with a written request stating the reasons why there was no intention to evade taxes, and they are required to consider the taxpayer's co-operation.
Penalties are also reduced when a taxpayer files an additional (amendment) tax return and pays additional tax voluntarily. But voluntary filings must be done before any notice is issued by the Revenue Department. Once a Revenue officer issues any kind of notice, the reduced rates applying for voluntary filings are no longer available.
Surcharges (Interest Charges)
Surcharge is a uniform interest charge for late payment of tax. The rate does not vary in line with “market” interest rates, but is fixed at the rate of 1.5% for each month or part of a month that tax remains unpaid i.e. 1.5% for each month or part month starting from the date the tax was required to be paid until the date it is paid.
Unlike for penalties, Thailand Revenue officers are not empowered to reduce surcharge, but the Revenue Code prescribes that the amount of the surcharge shall not exceed the amount of the tax shortfall (i.e. surcharges are not reduced, but are capped).
Summary of the Penalties and Surcharges
A summary of the penalties and surcharges applying under the three main tax investigation types conducted in Thailand is as follows:
* For Summons Investigations, reduced rates of penalties are possible if a taxpayer files a written request for a reduction of penalties and the Revenue audit officers consider that the taxpayer had no intention to evade tax and cooperated with them during the investigation.
For more details of the tax investigations, refer to our Tax Investigations Conducted in Thailand Guide.
This is a general information Tax Insight Article only. It should not be used to determine any particular matter without consulting with an experienced Thailand tax advisor.