Frequent question: How does VAT work in Thailand?

Value added tax (‘VAT’) is a tax on the sale of goods or the provision of services. The current rates are 7% and 0% with some exemptions from VAT. VAT paid (‘input VAT’) is offset against the VAT charged on sales (‘output VAT’).

How does VAT refund work in Thailand?

Goods must be purchased from stores displaying the ‘VAT Refund For Tourists’ sign. VAT refunds only apply to goods taken out of Thailand within 60 days from the date of purchase. Goods must have a value of at least 5,000 baht (including VAT), and single purchases must have a value of at least 2,000 baht per day.

How much is VAT in Thailand?

The standard rate of VAT is 10%, but the rate is currently reduced to 7% until 30 September 2021 (unless further extended by the government). VAT is levied on the sale of goods and the provision of services.

Who pays VAT in Thailand?

Any person or entity who regularly supplies goods or provides services in Thailand and has an annual turnover exceeding 1.8 million baht is subject to VAT in Thailand.

How does VAT get charged?

It’s charged by businesses on goods or services at the point of sale, and as it’s a consumption tax, it’s paid by the end customer, rather than the company selling the goods. … In the UK, whether a business must legally register for VAT or not depends on its annual turnover and the type of goods it sells.

Can VAT be refunded?

You can usually reclaim the VAT paid on goods and services purchased for use in your business. If a purchase is also for personal or private use, you can only reclaim the business proportion of the VAT .

Do expats pay tax in Thailand?

Thailand income tax applies to worldwide income, just as the US does. But unlike the US, only residents are taxed on their worldwide income while non-residents are taxed only on the income earned in Thailand.

How do I claim VAT in Thailand?

Tourists can claim a VAT refund at the VAT Refund for Tourists Counter at an international airport, or drop the documents into the box in front of the VAT Refund for Tourists office, or mail the documents to the Revenue Department of Thailand.

Is Thailand tax-free?

The Tax Refund for Tourists Scheme allows travellers to reclaim the 7% value-added tax levied on all purchases in the Kingdom of Thailand, with a few provisos: … During your entire trip in Thailand, you must have at least 5,000 baht of qualifying transactions to get a refund.

Do you pay income tax in Thailand?

The law stipulates that anyone who resides in Thailand for longer than 180 days is considered a resident. That’s right: not a resident as in a citizen, but citizen as in eligible to pay tax. This means you’ll need to pay tax on your global income, which is money you earn in your home country and any other country.

How do I claim VAT input?

In claiming deductions of input VAT in your value added tax returns, see to it that they are substantiated as follows:

1. BIR VAT Official Receipts for local purchases of services;
2. BIR VAT Sales Invoice for local purchases of goods; or.
3. Proof of VAT payment with the Bureau of Customs for importation of goods;

How much is import duty in Thailand?

Thailand’s average bound tariff for non-agricultural products is approximately 25.6%. Thailand levies high tariffs on goods such as: 80% on motor vehicles, 60% on motorcycles and certain clothing products, 54% to 60% on distilled spirits, and 30% on certain articles of plastic and restaurant equipment.

What is 7% VAT Thailand?

Value added tax (‘VAT’) is a tax on the sale of goods or the provision of services. The current rates are 7% and 0% with some exemptions from VAT. VAT paid (‘input VAT’) is offset against the VAT charged on sales (‘output VAT’).

Who pays VAT buyer or seller?

You must account for VAT on the full value of what you sell, even if you: receive goods or services instead of money (for example if you take something in part-exchange) haven’t charged any VAT to the customer – whatever price you charge is treated as including VAT.

How can I avoid paying VAT?

If you happen to offer a variety of products or services which are distinctly different, you may be able to avoid passing the VAT threshold by chopping up your business into smaller businesses that handle one product or service each. Your annual revenue is now split up between these separate businesses.

What happens if you forget to charge VAT?

If you fail to register for VAT with HMRC when you are supposed to, you may face a penalty. The amount of the fine is dependent on the amount of VAT owed, as well as on how late you were with your VAT registration. … Unfortunately, HMRC will still expect you to pay them the VAT that should have been charged at the time.