On 15 August 2023, Thailand Tax Royal Decree (No. 778) was gazetted, extending the corporate tax deduction concession for STEM employee training costs.

This Insight has been updated for the enactment of the Royal Decree (No. 778).

STEM Employee Training Costs

STEM employee training costs are education and training costs for employees in Science, Technology, Engineering and/or Mathematics.

The Tax Deduction Concession under RD (No 778)

Royal Decree (No 778) extends the Government's encouragement of corporate entities to send employees for STEM education or training that was previously provided under Royal Decree (No 712) for the 2019 and 2020 years, and Royal Decree (No 740) for the 2021 and 2022 years, as follows:

Applicability

From 01 January 2023 to 31 December 2025.

The Tax Deduction Concession

For the costs incurred in sending employees to STEM education or training or in conducting STEM education or training for employees a corporate tax deduction concession of 250%, i.e.:

• The normal 100% tax deduction for the education/training costs; plus
• An additional 150% tax deduction for the education/training costs.

Rules and Conditions

The rules and conditions prescribed in Royal Decree (No 778) are that:

1. The education/training shall be according to curriculums accredited by government agencies as prescribed by the Director-General of Revenue;
2. The costs incurred on the STEM education or training must not be used for exercising any other right to exemption from income tax under any other Royal Decree issued under the Revenue Code, in whole or in part;
3. A corporate entity claimant shall not be a business exempt from income tax under the law governing investment promotion, the law governing targeted industries, or the law governing the eastern economic corridor, in whole or in part; and
4. The corporate entity claimant shall comply with the Revenue Department's additional rules and conditions.

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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