FAQs of Thailand’s VAT on Non-Resident Electronic Service Providers

1- What Does Electronic Service Mean?

Electronic service refers to service including incorporeal property which is 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. Examples of such electronic service include online games, mobile application, and online advertising service. 

2- What is the e-Service Tax Law About? 

The Revenue Code Amendment Act (No. 53) B.E. 2564 (2021) stipulates that non-resident service providers and electronic platforms with income from providing electronic services to non-VAT registered customers in Thailand of more than 1.8 million baht per year are required to register for VAT, filing VAT returns, and remit VAT to the Revenue Department under a pay-only basis without deducting input tax or issuing a tax invoice. 

3- When does the e-Service tax law come into effect?

The e-Service tax law come into effect from 1st September 2021. Non-resident service providers and electronic platforms with income from providing electronic services to non-VAT registered customers in Thailand of more than 1.8 million baht per year are required to register for VAT and pay VAT to the Revenue Department starting from 1st September 2021.

4- Does the e-Service tax law apply to the sales of goods through an online channel and Q the goods is imported to Thailand via customs?

The e-Service tax law does not apply to the sales of goods through an online channel and the goods is imported to Thailand via customs since the importation of physical goods has to go through Thai customs and the Customs Department collects the VAT from the importation for the Revenue Department. 

5- Does the VAT registration of Non-Resident Electronic Service Providers and electronic platforms constitute a permanent establishment (PE) for income tax purposes in Thailand ?

The VAT registration in Thailand would not be a determining factor for having a PE in Thailand. 

6- If a non-resident electronic service provider or electronic platform is required to issue tax invoices in the country of incorporation, is the service provider or electronic platform able to issue the tax invoices for customers in Thailand?

Yes. However, the electronic service providers or electronic platform are not required to issue tax invoices under the Thai Revenue Code.

7- If a non-resident provides a Payment Service to non-VAT registered customers in Thailand, is the non-resident required to register and pay VAT in Thailand ?

No. The payment service is not an electronic service.

8- When Should non-resident electronic service providers and electronic platforms are liable to register for VAT?

When the revenue received from the provision of electronic services to non-Vat registered customers exceeds 1.8 million baht in an accounting period (for corporation) or a calendar year (for individual). 

For 2021, the first year of law enforcement, a corporation shall calculate the value of tax of 1.8 million baht. 

-Income received from the first day of the accounting period which does not end before September 1st, 2021.
-An individual vendor, income shall be calculated from January 1st, 2021.

In case electronic service providers and electronic platforms start operating business during the year, income shall be calculated from the first day of your business. You are required to register for VAT within 30 days from the day you have satisfied the income threshold.

9-When must a VAT return be filed?

The VAT operators shall file the value added tax return (P.P.30.9) and pay VAT on a monthly basis via the VAT for Electronic Service (VES) system on the Revenue Department’s website (www.rd.go.th). The Tax return shall be filed within the 23rd day of the next month. 

The VAT operators shall file the tax returns regardless of whether or not they have an income from providing electronic services to customers in Thailand in the tax month.

If a Vat operator has already filed the tax return but later found that the tax return was completed, the VAT operator can file an additional tax return.

10-Is a service recipient who is a VAT registrant still required to remit VAT from e-Service provided from abroad? 

A VAT registrant who uses an electronic service provided from abroad is still required to remit VAT from the service to the Revenue Department using the VAT remittance form (P.P.36).

Glossary 

Electronic Services 

Electronic service refers to service including incorporeal property which is 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.1 Examples of such electronic service include online games, mobile application, and online advertising service. 

Electronic Platform 

Electronic platform refers to market, channel, or any other procedure that many service providers use to provide their services to the service recipients.1 (Electronic platform acts as an intermediary between service providers and service recipients and facilitates service transactions. Such electronic platforms can be in the form of websites, mobile applications, or others.) 

VAT Registrant 

A VAT registrant refers to a person selling goods or providing services in the course of his business or profession who is VAT-registered in Thailand. 

Simplified VAT System for E-Service (SVE) 

Simplified VAT System for E-Service (SVE) refers to the electronic service system which the Revenue Department offers to service providers and electronic platforms providing electronic service from abroad (non-resident electronic service providers and electronic platforms) that are subject to VAT on such service provided to non-VAT registrants in Thailand. The system allows users to register for VAT, file VAT returns, pay VAT, and request for VAT refund electronically.

Download PDF A Guide on VAT on Electronic Service Provided to Non-VAT Registrants in Thailand by Non-resident Business Person (First Edition) by Revenue Department.

Thank you to the Revenue Department for the information.