Extension of Capital Expenditure Corporate Tax Deduction

Under the Royal Decree No. 604 of 2016 (B.E. 2559), tax benefits were given to companies or partnership’s expenses of domestic investment. On 24^th January 2017, the cabinet approved a one year extension of this tax measure, that is for the period from 1^st January 2017 until 21^st December 2017.

It should be noted that the privileges have been amended, in particular the multiple for the calculation of tax expenditure deduction has been reduced from 2 to 1.5.

Accordingly, under this tax measure, expenses can be deductible 1.5 times if they were incurred for the investment in these following assets: –

• Machinery, parts, equipment, tools, appliances, decorations and furniture;
• Computer programs;
• Vehicle except less than 10 seater cars; and
• Permanent building which lands and housing are included.

Eligible for deduction are the following assets:

• New assets which are invested in 2017 and will be ready for use within 31^st December 2017 (but not including machinery and permanent buildings which may be ready for use afterwards).
• Assets which already obtained the 2 times deduction from the Royal Decree no. 604, ifthe assets’ expenses for investment have not been completed and are still carried on in 2017. The multiple of 1.5 will then apply for the deduction under this tax measure.

Please be informed that the company or partnership which applies for this benefit must prepare investment project and expense plans and present these to the Revenue Department.

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