International Tax
Cross-Border Transactions & Group Structures
When a business has structures or transactions connected with other countries, the tax issues must be considered in several dimensions at once — domestic law, the applicable double tax agreement, and the relevant international standards. The firm offers 6 services covering international tax issues for both Thai businesses and foreign businesses operating in Thailand.
How international tax affects your business
When a business has transactions or structures connected with other countries, the tax issues must be considered from several dimensions at once, because each country asserts its taxing rights on a different basis — the country of residence taxes the worldwide income of its residents, while the source country taxes income arising within its territory. When both assert rights over the same income, double taxation arises; this is the origin of double tax agreements and the various mechanisms used to allocate taxing rights between countries.
These issues arise in two directions — foreign individuals or entities with income or activities in Thailand, and Thai individuals or entities with income or business operations abroad.
Cross-border related-party transactions
Cross-border transactions between a parent and its subsidiary, or between companies in the same group, can raise issues of both transfer pricing and the application of a double tax agreement, which must be analyzed together on the facts of each transaction.
Cross-border payments and withholding tax
Payments of service fees, royalties, dividends, or interest abroad may be subject to withholding tax under domestic law, and a double tax agreement may set conditions for reducing or exempting that tax, depending on the treaty articles and the facts of the case.
Residence, source, and permanent establishment
The country of residence applies the residence principle to tax the worldwide income of its taxpayers; the source country applies the source principle to tax income arising within its territory. Whether a foreign enterprise has a permanent establishment (PE) in Thailand directly affects the method of taxation, which differs significantly.
Choose the service that matches your issue
Our international tax services are divided into 6 areas according to the nature of the issue. Each has its own scope and conditions, and choosing the right service depends on the nature of the transaction and the issue the business is facing.
Double Tax Agreements
Analysis of the conditions for applying double tax agreements to cross-border transactions and income, covering the characterization of income, the determination of residence, and PE analysis.
- Businesses paying service fees, royalties, or interest to companies abroad
- Foreign enterprises that need to assess their PE status in Thailand
- Transactions requiring analysis of a reduction or exemption of withholding tax
Transfer Pricing
Advice on analyzing related-party transactions, preparing transfer pricing documentation, and assessing risk for groups with cross-border transactions.
- Groups with transactions between affiliated companies
- Companies that need to assess risk and prepare transfer pricing documentation
- Enterprises under a transfer pricing audit
Certificate of Residence for Tax Purposes
Support in analyzing the tax residence conditions and preparing the supporting evidence for an application for a Certificate of Residence from the Thai Revenue Department.
- Tax residents of Thailand who need to claim DTA benefits abroad
- Thai entities that must evidence their tax residence to a foreign authority
- Cases where the documents need to be checked before filing with the Revenue Department
Permanent Establishment Analysis
Analysis of the facts to assess whether a foreign enterprise has a permanent establishment in Thailand, covering fixed place, construction, service, and agency PE.
- Foreign enterprises that send employees or contractors to work in Thailand
- Foreign companies that need to assess PE risk before expanding
- Cases under examination on permanent establishment issues
APA and MAP Support
Support for advance pricing arrangements (APA) and the mutual agreement procedure (MAP) for transfer pricing disputes and cross-border double taxation.
- Groups seeking certainty on transfer pricing in advance
- Cases of international double taxation disputes requiring a MAP
- Businesses that want to assess whether their case is suitable before filing an APA
Pillar 2 Top-up Tax
Impact assessment and readiness under the Emergency Decree on Top-up Tax B.E. 2567 (2024) for multinational enterprise groups that may fall within Thailand’s top-up tax law.
- Multinational enterprise groups with consolidated revenue of EUR 750 million or more
- Thai companies in multinational groups that need to screen scope and impact
- Enterprises that need to prepare data and systems for Pillar 2
The firm’s role in this category
The firm’s services in this category focus on analyzing the facts and the transaction structure so that the correct tax law approach is set from the outset. The firm’s role is analysis and advice, working together with the client’s management and finance/accounting team.
Issues businesses often face
The following is an overview of the problems that businesses with cross-border transactions commonly encounter; each maps to a specific service.
Uncertainty about withholding tax on outbound payments
Many businesses are unsure which payments to companies abroad are subject to withholding tax and, where a double tax agreement exists, what the conditions for a reduction or exemption are → See the DTA service
Risk from undocumented intra-group transactions
Groups with related-party transactions but no transfer pricing policy and insufficient supporting documentation are at risk of adjustments by the tax officials → See the Transfer Pricing service
Lack of evidence of tax residence when claiming treaty benefits
Residents of Thailand who want to claim double tax agreement benefits abroad usually need a Certificate of Residence as supporting evidence → See the RO Certificate service
Other international tax issues that are not yet clear
Beyond the three main services, there may be issues where it is not yet clear which service applies. You can book a consultation (Thai) for a preliminary assessment of the facts directly.
Frequently asked questions
Which businesses are international tax services suitable for?
How does international tax differ from domestic tax?
What do the firm’s international tax services cover?
How do I start a consultation on an international tax issue?
What if I am not sure which service my issue falls under?
International tax issues in your case
Analysis based on the complete facts and transaction structure from the outset sets the right approach and reduces risk effectively.
+66 81 654 5922