Guide to VAT Registration Process Thailand
- gentlelawlawfirm
- 4 days ago
- 4 min read
When starting or running a business in Thailand, understanding the VAT registration process is essential. VAT, or Value Added Tax, is a consumption tax applied to goods and services. Complying with VAT rules helps avoid penalties and ensures smooth business operations. In this guide, we will walk you through the key points of VAT registration in Thailand, explain the process clearly, and provide practical steps to prepare your application.
Understanding VAT and Its Importance in Thailand
VAT in Thailand is a tax levied on the sale of goods and services. The standard VAT rate is 7%. Businesses that meet certain criteria must register for VAT and charge this tax to their customers. The collected VAT is then paid to the Thai Revenue Department.
Why is VAT registration important?
It is a legal requirement for businesses exceeding a specific turnover threshold.
It allows businesses to claim input VAT credits on purchases.
It enhances business credibility with suppliers and customers.
Who must register?
Any business with annual revenue exceeding 1.8 million THB (approximately 55,000 USD) must register for VAT. This includes foreign-owned companies operating in Thailand.
What if you don’t register when required?
Failure to register can lead to fines, back taxes, and legal complications. The Revenue Department has discretion in enforcement, so timely registration is advisable.
VAT Registration Process Thailand: Step-by-Step
The VAT registration process in Thailand involves several clear steps. We recommend following this checklist to stay organized and compliant:
Determine Eligibility
Check if your business turnover exceeds the 1.8 million THB threshold in the past 12 months or is expected to exceed it in the next 30 days.
Prepare Required Documents
Gather the necessary paperwork, including:
Company registration certificate
Tax ID number
Identification of company directors and shareholders
Financial statements or sales records
Lease agreement or proof of business address
Submit Application
File the VAT registration form with the Thai Revenue Department. This can be done in person or online through the Revenue Department’s website.
Wait for Approval
The Revenue Department typically processes applications within 7-15 business days. They may request additional information or documents.
Receive VAT Certificate
Once approved, you will receive a VAT registration certificate with your VAT number. This number must be displayed on all invoices and tax documents.
Start Charging VAT
From the date of registration, you must charge VAT on taxable sales and file monthly VAT returns.
How do I get a VAT registration?
Getting VAT registration in Thailand is straightforward if you prepare properly. Here’s what you need to do:
Step 1: Confirm your business turnover
Review your sales records to confirm if you meet the VAT registration threshold.
Step 2: Collect documents
Ensure you have all company documents ready. If you are a foreign-owned SME, you may need additional paperwork such as a foreign business license or work permits.
Step 3: Complete the VAT registration form
The form requires basic company information, business activities, and estimated turnover.
Step 4: Submit your application
You can submit your application at the local Revenue Office or online. Online submission is convenient but requires a Thai digital signature or authorized representative.
Step 5: Follow up
After submission, monitor your application status. The Revenue Department may contact you for clarifications.
Step 6: Receive your VAT number
Once approved, you will get your VAT number and certificate. Keep these documents safe and use them on all invoices.
Important tips:
Apply as soon as you meet the threshold to avoid penalties.
Keep accurate sales records to support your application.
Consider professional assistance if you are unfamiliar with Thai tax procedures.
What You Need to Prepare Before Applying
Preparation is key to a smooth VAT registration. Here’s a checklist of what you should have ready:
Company documents:
- Certificate of Incorporation
- Memorandum and Articles of Association
- List of shareholders and directors
Tax documents:
- Tax Identification Number (TIN)
- Previous tax returns (if applicable)
Financial records:
- Sales invoices or contracts showing turnover
- Bank statements
Business address proof:
- Lease agreement or utility bills
Authorized representative details:
- If you use a tax agent or consultant, provide their authorization letter.
Having these documents ready will speed up the process and reduce the chance of delays.
Filing VAT Returns and Compliance After Registration
Once registered, VAT compliance is ongoing. Here’s what you need to know:
Monthly VAT returns:
You must file VAT returns monthly by the 15th of the following month. Returns include details of sales, VAT collected, and input VAT paid.
Record keeping:
Maintain accurate and organized records of all sales and purchases for at least five years.
Input VAT credit:
You can claim input VAT paid on business expenses to reduce your VAT payable.
Penalties for non-compliance:
Late filing or payment can result in fines and interest charges. The Revenue Department has discretion but generally enforces compliance strictly.
Voluntary deregistration:
If your turnover falls below the threshold for 12 consecutive months, you may apply to deregister for VAT.
We recommend setting up a reliable accounting system or working with a professional to manage VAT compliance effectively.
Navigating Thailand VAT Registration with Confidence
Navigating the thailand vat registration process can seem complex, especially for foreign founders and SMEs. However, with clear steps and proper preparation, it becomes manageable. We encourage you to:
Start early and monitor your turnover regularly.
Keep your documents organized and up to date.
Seek professional advice if needed to avoid risks.
Understand your ongoing compliance obligations to maintain good standing.
At GENTLE LAW IBL, we help foreign-owned businesses set up and operate compliantly in Thailand. Our approach is transparent, practical, and client-friendly. We explain the process in plain English, outline clear fees, and provide proactive support to minimize risks.
By following this guide and staying informed, you can confidently handle VAT registration and focus on growing your business in Thailand.
