On 6 April 2019, Thailand Revenue Code Amendment Act (No 50) was gazetted, permitting foreign currency corporate tax return filings.

For Thailand corporate entities wishing to use a foreign currency for filing their corporate tax returns, a summary of the laws under RCAA (No 50) follows:

Applicability

Corporate financial years commencing on or after 1 January 2019.

Foreign Currency Corporate Tax Return Filings

A corporate entity that wishes to use a currency other than the Thai currency (its "functional currency") for filing corporate income tax returns shall:

• Notify the Revenue Department of its use of a functional currency for the preparation of its financial statements and its computations of corporate income tax;
• Use the functional currency from the first day of the financial year of the corporate entity's notification to the Revenue Department;
• Continue to use the functional currency for future financial years; and
• Not change the use of the functional currency unless the approval of the Revenue Department is firstly obtained.

Conversion of Assets and Liabilities

1. At the beginning of the financial year of using a functional currency:

• Assets and liabilities shall be converted according to a generally accepted accounting principle as prescribed in Accounting Standards, and
• Any carried forward losses shall be converted according to the average buying and selling rates of commercial banks as quoted by the Bank of Thailand,

2. At the end of the financial year, assets and liabilities shall be converted:

• According to the average buying and selling rates of commercial banks as quoted by the Bank of Thailand, or
• According to a generally accepted accounting principle as prescribed in Accounting Standards,

3. Once a method is chosen, it shall continue to be used and shall not be changed without the prior approval of the Revenue Department, and

4. Assets received and liabilities paid during the financial year shall be converted according to the rate on the date of receipt or payment.

Conversion of Tax Payments and Tax Refunds

Tax payments and tax refunds shall be converted according to the average of the buying and selling rates of commercial banks quoted by the Bank of Thailand for the day prior to the date of tax payment or approval for tax refund.

Exchange Gains or Losses

Any exchange gains or losses arising from conversions of currencies shall not be income or expenses for computing net profit or loss for tax purposes.

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