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  1. VAT on Foreign e-Service

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    On February 10, 2021, the Royal Thai Government Gazette publicized the Revenue Code Amendment Act (No.53), which mainly stipulates that non-resident electronic service providers and electronic platforms are required to register for VAT under certain conditions and allows tax documents and evidence to be provided electronically.

    What is an e-Service?

    Section 77/1 (10/1) of the Revenue Code defines an e-Service as “services including incorporeal property which are delivered over the Internet or any other electronic network and the nature of which renders their service essentially automated and impossible to ensure in the absence of information technology.”

    Here are some examples of electronic services based on our experience:

    • Software programs;
    • Digital images, videos, and financial data;
    • Digital music, films, and games;
    • Distance teaching via a pre-recorded medium such as online courses;
    • Electronic data management such as website supply, web-hosting, automated and digital maintenance of programmed;
    • Providing or supporting a business or personal presence on an electronic network;
    • Support services performed, via electronic means, for arranging and facilitating the completion of transactions, which may not be digital in nature, such as commission fees to intermediaries’ service fees to consumers and merchants for the sale of products through the electronic marketplace.

    The authorities gave a non-exhaustive list of e-Services excluded from this new e-Service VAT rule:

    • Telecommunication services;
    • Payment channel or money transfer services;
    • Electronic voucher delivered to the customer by e-mail or SMS to be redeemed for a meal, a hotel stays, or a theme park entrance;
    • Live teaching services, where the course content is delivered by a teacher over the Internet or an electronic network;
    • Professional services involving human intervention and the nature of which is not essentially automated, such as consulting services where advice from the consultant is communicated via e-mail or video call.

    Criteria for VAT registration

    Foreign electronic service providers and foreign electronic platforms providing e-Services from abroad and used in Thailand will now be required to register for VAT and will be liable to pay VAT when the following criteria are met based on our experience:

    • The services are used in Thailand by a customer that is not registered for VAT in Thailand, and
    • Incomes from the services are above 1.8 M THB in a calendar year.

    VAT registration

    Non-resident electronic service providers and electronic platforms that provide electronic services to non-VAT registrants in Thailand must apply for VAT registration within 30 days of the day that income from such services exceeds THB 1.8 million. It will be possible to register for VAT with the Revenue Department by September 1, 2021.

    The required documents for VAT registration vary, depending on whether the provider is a Juristic Person or Individual.

    I. Juristic Person

    • Certificate of incorporation, officially translated in English and containing entity name, date of incorporation, and country of incorporation. The document must be notarised by the Ministry of Foreign Affairs, notary public, or other agencies authorised to notarise documents based on the country’s law where the businessperson is incorporated.
    • Certificate of tax residency in the country of incorporation (optional).

    II. Individual

    • A copy of the individual’s valid passport or a copy of the individual’s valid national ID card;
    • Certificate of tax residency in the country where the individual is a tax resident (optional).

    All documents must be submitted to the Revenue Department by uploading to the SVE on the Revenue Department’s website. When the VAT registration is complete, the VAT registrant will be notified of the VAT registration via SVE, and the list of VAT registrants on SVE will be announced on the Revenue Department’s website.

    Please feel free to contact us if you have any questions at [email protected]