Tax Incentives for Foreign-Owned Businesses in Thailand: What You Need to Know
Are There Any Tax Incentives for Foreign-Owned Businesses in Thailand?
Thailand offers a variety of tax incentives and promotional schemes to encourage foreign investment in key sectors. These incentives are designed to attract foreign-owned businesses, promote innovation, and enhance the country’s economic development.
If you are a foreign investor planning to set up a business in Thailand, here is what you need to know about available tax incentives and how to qualify.
✅ 1. Board of Investment (BOI) Incentives
The Board of Investment (BOI) is Thailand’s primary agency for promoting investment and offering significant tax and non-tax incentives to both Thai and foreign-owned companies operating in targeted industries.
Key BOI Tax Incentives Include:
- Corporate Income Tax (CIT) exemption for up to 8 years, depending on the business activity.
- Exemption or reduction of import duties on machinery and raw materials.
- Double deduction for transportation, electricity, and water costs.
- Deduction for infrastructure construction and installation costs.
💡 Note: BOI also offers non-tax incentives, such as 100% foreign ownership, land ownership rights, and simplified work permits and visas.
✅ 2. Industrial Estate Authority of Thailand (IEAT) Incentives
Businesses located in IEAT zones (industrial estates) may receive:
- Exemption or reduction of import duties on machinery and raw materials.
- Exemption from export duties, excise taxes, and VAT for goods exported from Thailand.
- Permission to own land in the industrial estate.
IEAT is ideal for manufacturing and export-oriented businesses.
✅ 3. Double Tax Agreements (DTAs)
Thailand has signed Double Tax Agreements (DTAs) with over 60 countries, which help prevent double taxation on income such as dividends, interest, and royalties.
Benefits of DTAs for foreign businesses:
- Reduced withholding tax rates on cross-border payments.
- Clear tax residency and permanent establishment rules.
- Avoidance of being taxed twice on the same income (in Thailand and home country).
✅ 4. Regional Operating Headquarters (ROH) and International Business Center (IBC) Incentives
Thailand offers special tax regimes for companies that set up Regional Operating Headquarters (ROH) or International Business Centers (IBC) to manage regional operations.
Key incentives include:
- Reduced corporate tax rates (as low as 8-10%) on qualifying income.
- Reduced personal income tax rates for foreign executives.
- Exemptions or reductions in withholding tax on outbound payments.
✅ 5. Other Tax Incentives for Specific Sectors
Certain industries benefit from sector-specific tax incentives, such as:
- Technology and innovation (e.g., software, R&D, biotech).
- Renewable energy and environmental protection.
- Medical and healthcare sectors.
- Agricultural innovation and food processing.
🎯 Summary of Tax Incentives for Foreign-Owned Businesses in Thailand
| Incentive Type | Description |
|---|---|
| BOI Tax Incentives | CIT exemption (up to 8 years), import duty reduction. |
| IEAT Incentives | Tax and customs duty reductions in industrial zones. |
| Double Tax Agreements (DTAs) | Avoid double taxation, reduce withholding tax. |
| ROH/IBC Incentives | Reduced CIT and personal income tax for regional offices. |
| Sector-Specific Incentives | Special incentives for technology, healthcare, energy. |
💡 Key Takeaway:
Yes, foreign-owned businesses in Thailand can access various tax incentives through BOI promotion, IEAT, DTAs, and other special regimes — depending on the industry and business model. These incentives can significantly reduce tax costs and increase profitability for foreign investors.
💼 How BRW Can Help You Access Tax Incentives in Thailand:
At BRW – Boonrawee Co., Ltd., we specialize in:
- BOI application preparation and submission.
- IEAT industrial estate setup consulting.
- Structuring for DTA benefits.
- Tax planning and compliance advisory for foreign-owned companies.
📞 Contact BRW today to learn how to maximize tax benefits and start your business in Thailand smoothly!
