Thailand has become the latest country to impose Value Added Tax on non-resident providers and electronic marketplaces of digital or electronic services from 1 September 2021. This includes a VAT registration threshold of THB 1.8million annum (approx. €46,000), after which sellers should register with the Revenue Department. B2B transactions should use the reverse charge. There is a basic VAT compliance track for non-residents, the Simplified VAT System for E-Service (SVE).
What digital services are liable to Thai VAT
The following digital or electronic services fall under the non-resident VAT obligations for any fee income:
- SaaS or cloud software
- Mobil app’s and similar digital products
- Video and digital images
- Streaming media (music and films etc)
- Automated e-learning
- Webhosting and search engine services
- Online marketplace listing and other digital advertising services
- Digital intermediary, service or sales via electronic marketplaces
Telecoms, e-book and online news services are excluded.
B2B digital services – reverse charge
Non-residents should not charge VAT to business customers. This may be evidenced by a Thai VAT number or tax identification number. However, the foreign business is not required to check the validity of the number. But they should it looks reasobible (e.g. has 13 digits).
Electronic platforms and marketplace VAT liabilities
In addition to sellers of digital services now being liable to Thai VAT, electronic platforms or marketplaces may have to take on the indirect tax obligation. This applies the service providers provide electronic services through a platform with continuous processes if executing all of the following:
- offering service,
- receiving payment of service, and
- delivering service.
Simplified VAT System for E-Service
There is a VAT registration threshold of THB 1.8 million per annum (approx. €46,000) for a corporation’s financial year – or calendar year in the case of non-incorporated individuals. Although it is possible to voluntarily register before reaching this limit. Registration is via the Simplified VAT System for e-Service (SVE) on the Revenue Department’s website.
Once registered, VAT returns should be filed monthly via SVE. Any VAT can be paid by credit card or a direct bank transfer. The return and payment must be made by 23rd of the following month.
Asia Pacific VAT on digital services
|Comments (click for details)||Rate||Date||Threshold||Comments|
|Australia||10%||Jul 2017||AUD $75,000|
|Armenia||20%||Jan 2022||AMD 115million|
|Bangladesh||5% - 15%||Jul 2019||–||B2B and B2C|
|Bhutan||7%||Jul 2021||Nu 5million|
|Cambodia||10%||Mar 2022||KHR 250m|
|China||6%-13%||N/a||Nil||Withholding VAT; B2B and B2C|
|Indonesia||11%||Aug 2020||IDR600m or 12k customers|
|Japan||10%||Oct 2015||JPY 10 million|
|Laos||7%||Feb 2022||LAK 400m|
|Nepal||13%||Jul 2022||Rupees 2m||Also 2% DST|
|New Zealand||15%||Oct 2016||NZD 60,000|
|Pakistan||2%||Sep 2021||Nil||Marketplace Withholding VAT|
|Philippines||12%||Jan 2024 ?||P 3million|
|Singapore||7%||Jan 2020||S$ 100,000|
|South Korea||10%||Jul 2015||Nil|
|Taiwan||5%||May 2017||NTD 480,000|
|Thailand||7%||Sep 2021||1.8m Baht|