You must register for VAT in Thailand once your annual sales of goods or services exceed THB 1.8 million, by filing form PP.01 with the Revenue Department within 30 days. After registration you charge VAT at the current 7 % rate, issue proper tax invoices and file a PP.30 return every month, even when sales are nil.
The threshold applies to the total value of taxable supplies of goods and services in a calendar year, not to profit and not to cash received. Revenue Code rules look at sales as they are made, so a company that invoices a large project in December has crossed the line even if the customer pays in February. Businesses selling only VAT-exempt goods, such as certain unprocessed agricultural products, count differently, so the nature of what you sell matters as much as the amount.
A practical consequence is that turnover must be tracked cumulatively through the year. Many owners notice only when the bookkeeper adds up the annual figure, by which time the obligation to register arose several months earlier. A business that expects to grow past the threshold should plan the registration in advance rather than discover it.
The Revenue Department also treats the threshold per taxpayer. Splitting one operation across several small entities purely to stay under the line is a pattern auditors look for, and the Department can aggregate related activity.
Once the threshold is exceeded, the operator has 30 days to apply for registration at the area revenue office or through the Department’s online service, using form PP.01. The application asks for the identity papers of the operator or directors, the company certificate, the lease or proof of the business premises and a map of the location.
The Revenue Department then issues a VAT registration certificate, often called the PP.20, which must be displayed at the place of business. From the registration date the company must charge VAT on its taxable sales and show its VAT identification on documents.
Voluntary registration is possible below the threshold, and it suits businesses whose customers are mostly VAT-registered companies that can claim the tax back. A start-up that buys heavy equipment can also choose to register early so that it can claim input tax on its purchases. The cost is the monthly filing duty, which does not disappear in quiet months.
Thailand’s statutory VAT rate is 10 %, but the Government has applied a reduced rate of 7 % for many years through successive decrees, and 7 % is the rate businesses charge now. Because the reduction is renewed by decree, check the Revenue Department’s latest announcement before you hard-code any rate into a template.
A registered business must issue a tax invoice at the time of sale or payment, whichever the law makes the tax point for that supply. A full tax invoice has to show the words “tax invoice”, the seller’s and buyer’s names, addresses and tax IDs, a document number, a description of goods or services and the VAT amount separately from the price.
Prices quoted to consumers are often VAT-inclusive, whereas prices quoted to businesses are usually exclusive. Decide which convention each price list uses and state it on the quotation, because disputes over “was VAT included?” are among the commonest in B2B sales.
Each month the business files PP.30, showing output tax charged on sales and input tax paid on purchases. If output exceeds input the difference is paid, and if input exceeds output the business carries the credit forward or applies for a refund. The return is due by the 15th of the following month, and the Revenue Department normally allows a few extra days for online filing, which should be confirmed in its current notice.
Input tax is only claimable when supported by a proper tax invoice in the company’s name, and it generally has to be claimed in the month of the invoice or within a limited period afterwards. Receipts without the buyer’s tax ID, or invoices addressed to the director personally, are the usual reasons a claim fails in an audit.
A PP.30 is required even when there were no sales in the month. A nil return is quick to prepare, but forgetting it attracts a surcharge and a fine, so assign someone to the monthly cycle and not only to busy months.
The Revenue Department can ask to see the invoices, purchase documents and ledgers behind any return, so organise them by month. Keep a copy of each issued tax invoice, a file of supplier invoices and a reconciliation of the PP.30 figures to the general ledger.
The 4b2b products can help with the filing room, not with the filing. 4invoices produces PDF invoices and keeps them in an archive, and 4softerp lets your accountant keep multi-company books. They do not total your turnover against the threshold, prepare the PP.30, or submit anything to the Revenue Department, so the registration, the monthly return and the payment remain with you and your accountant.
The first mistake is ignoring a deposit or an advance. If a customer pays an advance before delivery, the tax point can arise at the time of payment, so an invoice is due then and not only when the goods ship. Businesses that wait until delivery to invoice end up issuing late tax invoices and reporting the VAT in the wrong month.
The second is mixing VAT-exempt and taxable sales without separating the input tax. Input VAT on costs that relate to exempt sales cannot be claimed, and costs shared by both need an apportionment method that you can defend. Keep supporting calculations in the same folder as the monthly return.
The third is treating a foreign supplier’s bill as if it carried Thai VAT. When a Thai business buys services from an overseas provider, it may have to self-assess the VAT through a separate return. That topic has its own page in the cross-border cluster, and it deserves attention before the first foreign invoice arrives.
Cumulative turnover is tracked in a spreadsheet, so crossing the THB 1.8 million threshold is noticed late.
Track cumulative turnover from the invoices you keep and check it against the THB 1.8 million threshold with your accountant. The system does not total turnover or warn you as you approach the threshold.
Output and input VAT are reconciled by hand every month, which is slow and error-prone.
Collect output and input VAT from invoices and purchase documents with your accountant to prepare the PP.30, which is filed with the Revenue Department. The system does not produce a monthly tax report or file the return.
A customer asks whether the quoted price includes VAT, and the sales team gives different answers.
State on every quotation whether the price is VAT-inclusive or exclusive and keep the same convention in the PDF invoice. The wording is yours; the system does not decide it for the customer.
You must apply within 30 days after your annual taxable sales pass THB 1.8 million. Because the count runs on sales made rather than cash collected, ask your accountant to total issued invoices every month. Keeping a running figure in your books lets you see the crossing date and file PP.01 on time.
Yes, voluntary registration is permitted. It makes sense when most customers are VAT-registered businesses that can recover the tax, or when you will buy large equipment and want to claim input tax. The downside is the permanent monthly PP.30 duty and the need to issue full tax invoices, so weigh the administration before applying.
A late return attracts a surcharge on any tax due and a fine for the late filing, and repeated lateness draws attention in audits. Even a nil return must be filed. If you realise you missed a month, file as soon as possible and discuss the amount with the Revenue Department or your accountant.
The Revenue Code sets 10 %, but a Royal Decree has reduced the rate to 7 % for a long period, and 7 % is what businesses currently charge. The reduction is extended periodically, so check the Revenue Department’s latest announcement before changing prices, templates or contracts that state a rate.
A VAT-registered business must issue a tax invoice for taxable sales, and the buyer needs a full one in its own name to claim input tax. For small retail sales the law allows an abbreviated tax invoice, but a business customer will usually insist on the full version, so offer it when asked.
An invoice archive. Registration and returns are handled with the Revenue Department.
