Latest tax return filing deadlines – August 21 update

HLB Thailand Tax Team


The following tax measures have been announced to support businesses and taxpayers due to the economic impact of COVID-19.

7% VAT rate extended

Following approval by the Thai cabinet, a new royal decree has been issued under the Revenue Code to maintain the VAT rate at 7% for a further 2 years, until 30 September 2023.

Extended deadline for e-filing of WHT, VAT and SBT returns

The deadlines for electronic filing of withholding tax returns (PND 1, PND 2, PND 3, PND53, PND 54), SBT returns (Por Thor 40) and VAT returns (Por Por 30 and Por Por 36) have been extended for the tax months of August 2021 to November 2021. This follows a similar extension granted for the tax months prior to August.

The extended deadlines are:

Tax monthE-filing extended deadline
August 2130 September 2021
September 2129 October 2021
October 2130 November 2021
November 2130 December 2021

Extended deadline for e-filing of corporate income tax returns

The deadlines for e-filing of corporate income tax returns (PND50, PND51, PND52 and PND55) which are due for filing during the period from 3 August 2021 to 22 September 2021 have been extended to 23 September 2021. The extension also applies to e-filing of financial statements and transfer pricing disclosure forms.

This means that the deadline for filing a mid-year corporate income tax return (PND 51) for the year ending 31 December 2021 has been extended from 8 September to 23 September 2021 in case of e-filing.

Extended deadline for e-filing of 2021 mid-year personal income tax return

The deadline for filing a mid-year personal income tax return (PND 94) electronically for the 2021 tax year has been extended from 8 October 2021 to 30 December 2021.

Penalty and fine reductions

Penalties will be waived or reduced as follows for late filing or incorrect submission of VAT returns (Por Por 30) and SBT returns (Por Thor 40) which are due for filing during September to December 2021, if the tax returns are submitted within 3 months from the extended due dates:

– If taxes and surcharges are paid in full, the penalty will be waived.
– If at least 25% of the tax due is paid, the penalty will be reduced to 2%.

Fines will also be reduced as follows:

– Fines not exceeding Baht 2,000 are reduced to Baht 1
– Fines not exceeding Baht 5,000 are reduced to Baht 2

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Latest tax return filing deadlines – July 21 update

HLB Thailand Tax Team


Companies with a 31 December 2021 year end must file a mid-year corporate income tax return, and pay any tax due, by 31 August 2021. The due date is extended to 8 September 2021 in case of e-filing.

Listed companies, commercial banks, certain other financial institutions, and taxpayers prescribed by the Director General are required to pay tax on their actual net profit for corporate income tax purposes for the first six months of the year.

All other companies are required to estimate their annual net profit for corporate income tax purposes for the 2021 year and pay tax on half of the estimated tax amount.
The tax paid on the return is creditable against a company’s annual tax liability for the 2021 year.

Surcharges apply for underestimating profits without a reasonable excuse.

Companies formed after 1 January 2021 and balancing on 31 December 2021 and therefore have an accounting period of less than 12 months, are not required to file a mid-year return. Companies are also not required to file a mid year return for their last accounting period if it is less than 12 months.

Extended deadline for e-filing of WHT and VAT returns

For monthly WHT returns and VAT returns filed electronically, which are normally due for filing during the months of February 2021 to June 2021, the filing date has been extended to the last day of the month.

This extension therefore applies to withholding tax returns (PND 1, PND 2, PND 3, PND53, PND54) and VAT returns (Por Por 30 and Por Por 36) for the tax months of January 2021 to May 2021.

For returns due for filing during the month of July 2021, the deadline for e-filing has been extended to 30 July 2021, and for returns due for filing during the month of August 2021, the deadline has been extended to 31 August 2021.

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COVID-19 delays Thailand’s tax reform plans

HLB Thailand Tax Team


The following article was first published in International Tax Review. For all articles authored by HLB Thailand for the International Tax Review, please click here.

Thailand’s economy is currently at its weakest since the 1997 Asian financial crisis. This has led the Thai government to put on hold its plans to undertake major reforms of tax policies.

Tax revenue collections in 2020–2021 have weakened due to the pandemic’s effect on businesses, especially those in Thailand’s hard hit tourism industry. The Thai government received approval this month to borrow another Baht 500 billion (approximately $16 billion) to fund the government’s projects for tackling COVID-19.

Thailand’s tax revenue collections in terms of its ratio to GDP is relatively low compared to OECD countries and this ratio has dropped further as a result of the pandemic. The tax reforms, now delayed to 2022, will aim to increase tax collections in the long term, against the backdrop of an ageing population and shrinking workforce.

Four goals for tax reform

Thailand’s Fiscal Policy Office has recently reported that the draft plan for tax restructuring for 2022–2026 will focus on four goals, namely:

  • Enhancing the country’s competitiveness to ensure sustainable economic growth;
  • Promotion of the digital economy, by deploying technologies to upgrade the country’s tax management system; promoting a green economy;
  • Encouraging people to reduce the use of products that could harm the environment; and
  • Ensuring fair treatment and transparency and promoting social safety nets and the health sector.

How these goals will be met has not been determined yet. The OECD has recommended that fiscal policy reforms focus on tax efficiency, increased compliance and less distortive tax bases.

Property tax reforms in force

A recent example of tax reform in Thailand is the new property tax legislation that came into effect in 2020, after numerous attempts over the years to reshape the way property tax is imposed in Thailand.

Under the new law, the types of property taxed is expanded, the government’s appraised value of the property is used as the tax base rather than its subjective rental value, and higher rates of tax apply for unutilised land to discourage land banking. The impact of the new tax has been muted so far, with the government implementing a tax cut of 90% for 2020 and 2021 due to the pandemic.

7% VAT rate set to continue

VAT forms a large part of the Revenue Department’s tax collections, making up 40% of its tax revenue target for the fiscal year ended September 30 2021.

Thailand’s VAT rate has been 7% for many years now. As the Revenue Code sets the standard rate at 10%, a Royal Decree is issued to reduce the rate to 7%. The latest Decree expires on September 30 2021, leading to speculation about a possible rate increase. The finance ministry has however confirmed it currently has no intention to propose a higher rate.

BEPS-related initiatives

One area of focus for Thailand’s Revenue Department has been the continued roll out of transfer pricing (TP) rules and guidance notes following the introduction of TP laws in 2019, as part of the country’s commitment to implement the OECD/G20 BEPS Action Plans.

The Revenue Department now has significant data about taxpayers’ related party dealings in Thailand, which is likely to be used in selecting taxpayers for TP audits.

In another BEPS-related initiative, starting from September 2021, foreign e-commerce businesses will be liable for VAT on services provided to customers in Thailand.

Thailand has one of the fastest growing e-commerce markets in South East Asia and the Thai government expects to generate annual revenue of Baht 5 billion from this measure.

Personal tax reforms to increase fairness

There is a relatively low number of registered personal income taxpayers in Thailand. Reforms are therefore expected to target improved compliance.

The pandemic has shifted more sole traders online, making their activities more visible. It has been reported that the Revenue Department aims to pull 500,000 individuals into the tax system, including online merchants and influencers, YouTubers and freelancers.

Personal tax rates in Thailand range from 5% to 35% whilst the standard corporate tax rate is 20%. Small and medium Thai companies meanwhile receive preferential tax treatment. The first Baht 300,000 of profit is exempt from tax, whilst the profit from Baht 300,001 to Baht 3 million is taxed at the rate of 15%.

The disparity in personal and company tax rates may entice entrepreneurs entering the tax system to consider trading as a company instead to pay less tax on their profits. A law has been drafted to allow single shareholder companies to be formed in Thailand, which would make it simpler for small businesses to operate as a company.

One of the reasons for the tax restructuring proposed for 2022–2026 is to increase revenue collections in the long term to meet the needs of an ageing population.

Thailand’s old-age dependency ratio, defined as the number of persons aged 65 and over relative to the 20–64 years old population, is projected to increase rapidly over the coming years. Greater demand is therefore expected to be placed on the social security system and the public health sector in the future.

The timing of any ambitious tax reforms will be dependent on how quickly the government can reign in the pandemic’s impact on the country’s economy.

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As the hospitality industry struggles, taxes are knocking on the door

HLB International Transfer Pricing Centre of Excellence


One of the long-term effects of the pandemic – besides the business effects that vary between different activities in the hospitality industry – are the tax consequences that result from the dramatic changes due to COVID-19.

The hospitality industry in general, was performing at a great level until December 2019, while the pandemic was in gestation. Hotels, restaurants, adventure activities, airlines and all related services attached to that “normal” situation were in a booming stage; then suddenly every single activity related to hospitality reduced almost to nil.

Countries in full lockdown stopped hospitality and the freedom mobility value chain. Almost every flight was cancelled and a zero-tourism season – never seen before – became a reality. The nightmare started…

Despite all this well-known reality, governments have spent their scarce resources trying to address at least three priorities:

  1. To solve the health effects of the pandemic,
  2. To mitigate huge unemployment rates, another consequence of the lockdowns, and
  3. To compromise on both current and extraordinary expenditure; whilst income derived from taxes is also plunging, stressing the conditions of deficit severely.

The OECD has stressed the fact that governments must focus on getting the economy back to work, while acknowledging that fiscal equilibrium might not be the goal for 2020 -2022. Yet all jurisdictions are seeking innovative ways to obtain fresh fiscal income that will start the road towards the fiscal recovery.

Knowing this, the hospitality industry must prioritise transfer pricing and its impact in their taxable bases, when dealing mainly with cross border transactions. These cross border business relationships with related parties will become subject to scrutiny.

Thresholds vary from jurisdiction to jurisdiction and relevant documentation as well, yet most of the countries imposed the burden of proof on the taxpayer to document that those transactions with related parties are in accordance with the arm´s length principle.

On December 18th, 2020, the OECD issued a paper titled “Guidance on the Transfer Pricing Implications of the COVID-19 Pandemic.” This document stresses the severe impact of the pandemic and the consequences of it, using several business models to illustrate the impact on the normal circumstances of transfer pricing adjustments, to be considered by both the tax administrations and taxpayers as well.

“Accordingly, this guidance focuses on how the arm’s length principle and the OECD TPG apply to issues that may arise or be exacerbated in the context of the COVID-19 pandemic, rather than on developing specialised guidance beyond what is currently addressed in the OECD TPG. This guidance focuses on four priority issues: (i) comparability analysis; (ii) losses and the allocation of COVID-19 specific costs; (iii) government assistance programs; and (iv) advance pricing agreements (“APAs”); where it is recognised that the additional practical challenges posed by COVID-19 are most significant.”[1]

[1] OECD. Guidance on the transfer pricing implications of the COVID-19 pandemic. Dec 2020. Pg. 2.


Be aware that matters that are obvious today, might not be clear some years from now; when businesses in general may get back to their regular operations. You should have highly well documented the elements of current circumstances, mainly those issues about comparability analysis of your support documentation of related parties’ transactions, awaiting the audits by tax authorities.

(Read more about the OECD Guidelines and the impact of COVID-19 on transfer pricing in Thailand).

Undoubtfully, economic activity for hospitality businesses would not be comparable to the pre-existing conditions prior to COVID-19. It is going to take many years to recover and get back on track, if ever, to those pre-2019 levels.

The OECD’s recommendation is to create the appropriate documentation that shows the effects of the extraordinary expenses needed to be incurred as result of the pandemic, in an isolated manner. It would also be wise to create a separate profit and loss statement that illustrates the evidence of these effects. The need to isolate this is critical for the comparability analysis, mainly for the first quarter of 2020 and any periods of permanent or temporary reopening, so that the database analysis can be adjusted when doing the extraordinary adjustments that will be triggered by the COVID-19 effect.

It is also important to have clearly segregated information in the P&L, such as the received government support programs when applicable. Do not mix such income with regular income that will distort comparable numbers.

It is highly recommended to contact your team of transfer pricing experts to solve multiple issues regarding COVID – 19. Consider that there would be a high level of uncertainty surrounding tax inspections in the future. Our best advice is to fully document everything, to prepare for huge and potentially massive audits induced by the lack of fiscal resources.

At HLB we understand the hospitality industry and have vast experience in cross border transactions that could become a new nightmare soon. We will move from the pandemic to the endemical effects in taxation and in transfer pricing matters.

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Social Security contribution rate reduced to 2.5% for June - August 2021

HLB Thailand Tax Team


The Thai Cabinet has approved the proposal of the Social Security Board to reduce contributions for both employers and employees from the current 5% rate to 2.5% for three months from June to August 2021, to alleviate the suffering of insured persons from the impact of Covid-19. 

The monthly wage base for contributions ranges from THB 1,650 to a maximum of THB 15,000 for each employee. 

The maximum contribution will therefore be reduced to THB 375 per month for both employers and employees for the three months from June to August 2021.

Monthly contributions by voluntary insured persons under Section 39 of the Social Security Act have also been reduced to THB 216 per month (from THB 432 per month) for three months from June to August 2021.

For social security contributions filed electronically for the 2021 year, the filing date is extended for seven working days. The extended filing deadlines for the remainder of the year are summarized below.

April 2021              – 27 May 2021

May 2021               – 24 June 2021

June 2021              – 29 July 2021

July 2021               – 25 August 2021

August 2021          – 27 September 2021

September 2021   – Other regions: 27 October 2021

                                – Central region: 28 October 2021

October 2021        – 24 November 2021

November 2021    – 24 December 2021

December 2021     – 24 January 2022

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Ransomware identified as the fastest growing malware threat

Bernard Collin, CEO of SafeComs Network Security


What is ransomware?

Ransomware is a type of malware that encrypts files on a targeted system or network. Once the targeted files are encrypted, the ransomware demands payment in exchange for providing a key to decrypt the files, often around $1,000 – $20,000 in Bitcoins. We’ve seen cases where as much as $5M was paid to the attackers. Most ransomware variants opportunistically target victims. They can infect a wide array of devices from computers to smartphones. Any networked device could potentially be affected by ransomware.

It’s important to know that paying the ransom never guarantees that the decryption key will be received, or that the encrypted files will be restored.

How do you get ransomware?

Most ransomware is unintentionally downloaded by clicking on a malicious link, often in a spam email. It’s also possible to pick up ransomware during a visit to a malicious or compromised website by way of  drive-by downloads, which don’t require user engagement for the infection to be successful.

Occasionally ransomware is the result of brute force attacks carried out by way of the Remote Desktop application, which is becoming increasingly popular as  the working population works from home.

It’s easy to imagine just one person in your organisation accidentally clicking on a malicious link or falling victim to an attack. With just one compromised employee, your entire network could be in jeopardy. 

Early ransomware infections were typically opportunistic attacks against random targets. Today ransomware is often deployed as part of a targeted campaign with specific victims in mind. Malicious links and spam emails will be tailored to the unique professional situation of the intended target, and will usually contain material related to a plausible activity (i.e. “here is your budget for revision, please approve…” or, “here is the link to our company outing with all our photos, feel free to share with your friends…”).

A developing trend

A growing trend with PDPA and the “Working from Home” Covid campaign is the additional capability of data exfiltration. If a victim doesn’t pay the ransom, their files may end up being published on a publicly exposed server, for all to see.

In addition to the embarrassment, there’s also a profoundly serious business risk due to the loss of confidentiality amongst clients and the potential of heavy fines incurred under the governance of PDPA.

To make matters worse, ransomware today doesn’t require technical expertise. Malicious actors can simply use a RaaS (Ransomware as a service) application, which allows them to rent the malware along with technical support and tutorial features, and simply share some portion of the loot with the ransomware’s creator after the fact.

This level of accessibility and ease of use makes ransomware a particularly worrisome threat. 

Who is a target?

The largest companies were the initial targets; however, their technical capability makes them harder to penetrate. Now we see a move towards smaller entities in the service industry, where costs rarely allow for a full-time IT team with security expertise. Most engineers would have a lower technical profile, enough to support business operations without any kind of  subject specific security knowledge.

Data Security

How to stay protected

At SafeComs we believe that SMEs deserve the best protection available at an affordable price, with expertise similar to what was once reserved for large Enterprises. Our experts are available on an individual project or ongoing basis, with enough time to review the security status, evaluate the risks and put in place mechanisms and procedures to secure your company and its systems.

This is why we created a Cybersecurity Awareness training program, delivered online with a certificate of completion for each employee. We review security status and advise on best practices, in addition to testing the resistance of your company to emerging threats. We use sophisticated tools to block malware and the transfer of their encryption programs, developing and enforcing security policies aimed at protecting your enterprise from any angle.

How can I prepare for a ransomware attack?

The following elements are vital to creating a secure environment for the company and employees:

  •       An incident response plan that describes how to react to malware is paramount
  •       Your backups are critical. Not on a network disk, not onsite, encrypted and with a daily history.
  •       Up to date antivirus, anti-phishing, Security patches, SPAM filter and a policy to block encrypted files, an important vector of malware today.
  •       Monitor your internet traffic and limit access to sites not required for your activity.
  •       Segregate data with privileges elevation, not everybody needs access to everything
  •       Control and approve the third party who can access your network
  •       Have a mechanism to record and report incidents

Bernard Collin is the CEO of SafeComs Network Security. SafeComs monitors PCs and Servers across South East Asia with a unique proprietary tool, Total Control. Headquartered in Thailand, SafeComs supports a large network of prestigious SMEs in the region and delivers quality security solutions to their clients. SafeComs is responsible for the security of systems and data of HLB Thailand.

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HLB's Survey of Business Leaders 2021 spotlights opportunities and challenges for the financial services sector in the wake of COVID-19



HLB global recently conducted a survey of  executives across multiple sectors to gauge confidence in global economic growth. The results of HLB’s survey shed light on many of the top challenges and opportunities facing the financial services industry in the wake of COVID-19.

As financial services uniquely reflect trends occurring across all other industries, the survey results discussed below should in fact provide value for executives of any stripe. 

Here are just a few of the survey’s key findings at a glance:

  • Only 20% of business leaders in financial services believe the rate of global economic growth is likely to increase over the next 12 months.
  • Undertaking joint ventures is  a priority for financial service executives
  • Digital capabilities are a current weakness, but adopting emerging technologies presents a growth opportunity over the next 12 months

As lockdowns came into effect around the globe, the financial industry was quick to transition into online services. However, the shutdown of in-person banking posed serious difficulties for smaller and more  rural institutions. Generational differences in consumer technology use, combined with less robust infrastructure, left some firms scrambling to adopt contactless technologies.

Continued restrictions on in-person financial services led to further revenue losses as business owners and consumers weren’t able to pay loans. The loss of trade and bond values and low interest rates affected profitability. Moreover, business owners began drawing on open credit lines, leaving financial institutions with less liquidity.

With interest rates expected to remain low, financial executives face a myriad of challenges in 2021.

HLB’s survey reflects this challenging environment and clarifies some of the financial industry’s top growth priorities, potential vulnerabilities, and future outlooks.

Financial executives are less optimistic about international growth prospects than their global peers, and only 12% say they’re very confident in their own growth prospects. Nonetheless, there’s a widespread consensus that emphasising growth tactics and risk reduction can help institutions navigate the current environment.

This applies as much to businesses operating here in Thailand as it does anywhere else.

The economy: Uncertainty lowers confidence

Institutions with less client diversity ran into more challenges during the pandemic than firms with assets balanced across multiple sectors.

Additionally, traditional financial services face overwhelming competition from fintech as global customer bases become more accustomed to contactless services in the era of COVID-19. This comes on top of existing trends toward digital-first consumer patterns.

Today’s clients are comfortable using online financial services to crowdsource funds or access loans without partaking in less convenient in-person banking processes. Add in concerns about regulatory changes, potential rising tax rates, and rock bottom interest rates, and technology averse firms in the financial sector have plenty to be concerned about.

Globally, 23% of business leaders believe global economic growth will increase. But, only 20% of financial executives feel the same way. In comparison, 26% of technology professionals and 25% of manufacturing leaders expect global economic growth to increase.

Like other business leaders, 87% of financial executives worry about economic uncertainty, and 78% express concerns over the impacts of COVID-19. The majority of financial leaders also acknowledge potential threats to growth, such as: 

  • 66% cite cybersecurity issues 
  • 65% mention tax risks
  • 63% refer to regulatory change
  • 62% specify social instability

The combination of security, regulations, taxes, COVID-19, and social instability can lead to less faith in growth prospects for individual institutions. Although 65% reported confidence in their own growth prospects over the next twelve months, this lags behind the global average of 75%. 

Growth priorities for financial services leaders

Nearly all business sectors list improving operational efficiencies and reducing costs as key ways to grow this year.

Compared to other industries, 11% more financial services executives believe the adoption of emerging tech is critical to growth. Furthermore, financial professionals prioritise joint ventures and strategic alliances higher than their global peers, with 12% more making this a top priority. 

Even before the pandemic, financial executives  focused on mergers and partnerships to improve digital capabilities and expand their technological capacity. But a shift to remote work and client behavioural changes meant institutions had to speed up their digital transformations. Fintech firms, wealth management agencies, and the global payment sector now firmly rely on technology to provide secure client and employee tools.

To balance the costs of implementing emerging technologies and achieve growth, financial leaders understand they must reduce costs and improve efficiency by connecting with partners who can contribute both new tech and new customer bases.  

Analysing barriers to growth 

55% of financial leaders say their existing digital capabilities are a weakness and believe that improving their technology is essential to growth. That means that most executives will concentrate on expanding their digital platforms in the coming 12 months.

The use of technology will also help leaders address noted vulnerabilities dealing with cybersecurity and talent acquisition.

To achieve results, 24% of respondents want to see more innovation, and 29% will focus on improving operational effectiveness. 

HLB's Survey of Business Leaders 2021 financial services opportunities

Its worth noting that digital capabilities differ by segment.

The global payments industry takes the lead with contactless payment technologies supported by hefty fees for card-not-present (CNP) transactions. Meanwhile, wealth management companies look to increase access to big data analytics to generate client insights, track business performance, and deliver real-time investment advice. However, smaller institutions may prioritise consumer-facing technologies in rural areas, where 5G roll-outs may influence banking decisions.

Although many banks have already gone digital, handling the influx of big data and using it for business decisions is still a challenge. Smaller institutions will continue to look for ways to generate insights from existing data to select the right mix of products and services to increase client acquisitions and retention rates.

It’s also important to look at the impact of potential regulations and tax increases.

For example, the global payments industry saw rapid adoption of Europay, MasterCard, and Visa (EMV) technology in 2020. But many retailers are pushing back against exorbitant CNP fees. While the customer is paying in person, payment processors may charge the higher CNP fee. Increased pressure could result in regulatory changes, or business owners may seek out options with lower costs. 

Future success relies on digital capability improvements 

Cloud computing is a top priority for financial executives pursuing  digital transformations. However, financial executives are less interested in the internet of things (IoT), virtual reality (VR), and augmented reality (AR) than global peers. Instead, financial services executives identified the following technological advancements as important to future business success: 

  • 37% artificial intelligence (AI)
  • 25% machine learning (ML)
  • 24% 5G technology
  • 23% blockchain

HLB's Survey of financial services opportunities

Blockchain, AI, and ML

AI and ML both serve prominent roles in the financial industry, so increasing these capabilities is unsurprisingly considered vital.

There’s a growing demand for simple online processes with growth in platforms that tout speed and contactless methods for securing funds, approving applications, and transferring money into accounts. AI and ML can automate much of the back-office processes reducing human errors and operational costs.

In our global survey, only 10% of respondents consider blockchain essential to future business success, but a digital ledger of transactions presents many opportunities for financial leaders. While some worry about potential revenue losses, others aim to leverage the technology to improve existing systems and reach new markets. With support from prominent financial institutions, such as JP Morgan, Citigroup, PNC, and Wells Fargo, more organisations evaluate ways blockchain can enhance their digital assets.

Moving forward, many of these technologies will become less of a perk and more of a necessity. As 5G rolls out, financial institutions can use AI, ML, and blockchain to: 

  • Enable cross-border payments in real-time 
  • Reduce transaction costs and the paperwork required to transfer funds internationally 
  • Comply with anti-money laundering and know your customer (KYC) regulations
  • Attract digital-first generations wanting convenience, transparency, and security

Accessing talent and increasing diversity

With financial leaders across all sectors listing talent acquisition as a weakness, finding new ways to attract and retain employees remains essential.

For many in the financial sector, a shift to remote work has helped break down barriers to talent acquisitions and opened the door to a vast pool of job candidates. Flexible work options allow business leaders to source talent with the skills needed for planned technology advancements. In fact, 73% of financial leaders expect remote work to make it easier to source diverse talent, compared to just 65% of their global peers. 

Indeed, diverse talent is a must for financial services leaders, with 87% saying building diversity in the board and workforce is increasingly important and 84% saying that a more diverse and inclusive workforce will ultimately improve financial performance. Furthermore, 96% agree on the importance of ensuring equal support and opportunities, particularly in the current environment.

Greening of the financial services sector

88% of business leaders in financial services are making changes to their company to profit in the low-carbon economy, versus just 77% of their global peers, making it clear that the financial industry is  already feeling the impact of climate change. Since the Network for Greening the Financial System (NGFS) formation in 2017, more executives are tuned into how climate change is affecting their organisations. 

According to the Morgan Stanley Institute for Sustainable Investing, “Between 2016 and 2018, climate change-related weather events caused more than $630 billion in economic damage worldwide.” Some of the effects already being felt include defaults on loans in areas with extreme weather events, debtors impacted by environmental fines, and manufacturers in plastic or water-heavy segments losing business from new regulations and water shortages. 

Going forward, 24% of leaders aim to take measures to protect asset values and create value through innovation. Moreover, 70% of financial services leaders are reassessing their supply chain to source closer to home.

Each of these steps may help executives increase operational efficiency and prepare their institution for climate change disruptions. 

A new way of work

If COVID-19 has proven anything, it’s that staying connected and ensuring business continuity during disruption is absolutely vital.

Industry leaders believe they can leverage remote work to attract top talent, but many don’t feel an entirely remote workforce is the best solution. Furthermore, 86% agree that social distancing and remote working make it challenging to deploy the value of human touch in their businesses.

The top issues with remote work include:
-55% of respondents say remote work makes collaborative working harder
-42% believe it affects creativity
-42% think it dampens empathy 

However, similar to other global leaders, 89% of financial services executives say physical and mental wellbeing is a top priority for human resource departments. With this in mind, the hybrid model is a way to support wellbeing while offering the flexibility craved by top talent.  

Looking ahead with optimism 

Although financial leaders keep a close eye on global and internal growth capabilities, they don’t doubt their expertise to navigate challenges. 94% of business leaders based in this sector are confident in their ability to successfully steer the business in a new direction in response to the impact of COVID-19.

With the possibility of future tax hikes, new regulations, and an increased focus on climate risks, financial service experts have their hands full. Intense focus on growth opportunities while increasing digital capabilities will allow institutions to cater to digital-first generations, mitigate risks, and remove barriers.


Findings in this article are based on 93 survey responses from Financial Services business leaders collected in quarter 4 of 2020, as part of HLB’s Survey of Business Leaders 2021. The majority of businesses surveyed are privately or family owned. For the full research report see HLB’s Survey of Business Leaders 2021: Achieving the Post-Pandemic Vision: leaner, greener and keener. 

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2021 AGM extension due to COVID-19 restrictions

HLB Thailand Legal Team


The Department of Business Development (DBD) has announced an extension of up to one month for holding an Annual General Meeting that was scheduled to be convened between 26 to 30 April 2021 but is postponed due to the government restrictions on gatherings due to the COVID-19 pandemic.

Such restrictions exist in 18 provinces: Bangkok, Chiang Mai, Chonburi, Samut Prakan, Prachuap Khiri Khan, Samut Sakhon, Pathum Thani, Nakhon Pathom, Phuket, Nakhon Ratchasima, Nonthaburi, Songkhla, Tak, Udon Thani, Suphanburi, Sa Kaeo, Rayong and Khon Kaen.

The extension applies if notice was given to convene the meeting between 26 and 30 April 2021 before the government restrictions were enforced.

For companies that reschedule their AGM pursuant to this extension, the due date for filing the list of shareholders at the date of the AGM and their financial statements with the DBD will be based on the actual date of the AGM.

Limited companies are required to file a list of shareholders at the date of the AGM with the DBD within 14 days of the AGM date, and the financial statements approved at the meeting must be filed within 1 month of the AGM date.

Therefore, if the AGM of a limited company was originally scheduled for 30 April 2021, and is rescheduled to 30 May 2021, the shareholder list must be filed within 14 June 2021 and the financial statements must be filed with the DBD by 30 June 2021. The DBD must be informed of the extended AGM date at the time of filing.

Companies do have the option of holding their meetings online, in accordance with the rules introduced last year in response to the COVID-19 pandemic.

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OECD Guidelines for Transfer Pricing during the COVID-19 Pandemic in Thailand

HLB Thailand Transfer Pricing Team


Taxpayers and tax administrators around the world are grappling with the unprecedented impact the COVID-19 pandemic is having on transfer pricing arrangements.

On 18 December 2020, the OECD published the much-awaited “Guidance on the transfer pricing implications of the COVID-19 pandemic”.

The Guidance represents the consensus view of the 137 members of the OECD’s Inclusive Framework on base erosion and profit shifting (BEPS) regarding the application of the arm’s length principle and the OECD Transfer Pricing Guidelines to transfer pricing issues in the context of the COVID-19 pandemic. 

To fulfill Thailand’s commitment as a member of the OECD’s Inclusive Framework on BEPS, Thailand introduced legislation effective for accounting periods starting on or after January 1 2019 to codify the arm’s-length principle into Thailand’s Revenue Code. The legislation also introduced mandatory documentation requirements and filing of transfer pricing disclosure forms by certain taxpayers.

Thailand’s transfer pricing laws and regulations are still evolving and the Guidance provides an important and useful reference in addressing transfer pricing issues faced by taxpayers in Thailand affected by the pandemic. 

The Guidance is intended to assist taxpayers with reporting the financial periods affected by the pandemic in their transfer pricing documentation and for the tax authorities in evaluating the implementation of taxpayers’ transfer pricing policy or policies on the following critical issues submitted by the members of the Inclusive Framework:

  1. Comparability analysis; 
  2. Allocation of losses and the allocation of COVID-19 specific costs;
  3. Government assistance programmes; and 
  4. Advance pricing agreements.

The Guidance also clarifies how the arm’s length principle and the OECD Transfer Pricing Guidelines (“OECD TPG”) apply to issues that may arise due to the COVID-19 crisis and should not be regarded as an expansion or revision of the OECD TPG. 

Comparability analysis

OECD Guidelines for Transfer Pricing in Thailand - Comparability analysis

The selection of an appropriate comparable company plays a vital role in evaluating the arm’s length analysis of a set transfer price. Due to the pandemic, the global economy’s dynamics (business, markets, industries, and supply chains) have witnessed an unprecedented change, making robust comparability analysis challenging, in particular:

  • Lack of comparability – establishing comparability criteria and/or comparability factors; determining whether we are comparing apples with apples or oranges requires careful analysis;
  • Lack of comparable financial data;
  • Timing of comparability analyses; 
  • Actual financial results vs. forecasted or budgeted results;
  • How appropriate it is to consider loss-making companies as comparable, etc. 

The Guidance provides the following pragmatic approaches to tax administrators to minimize disputes with taxpayers:

  • The Guidance suggests that both tax authorities and eligible taxpayers exercise due care in exploring the best available market evidence for determining a reliable arm’s length outcome to establish the impact of the pandemic on taxpayers’ businesses, for example, internal or external comparables, and/or changes in the demand and supply factors in their industry;
  • In order to compare the taxpayer’s operating profitability against third parties, the tax authorities temporarily could resort to applying a price-testing approach instead of a price-setting approach (preferred by the tax authorities in ordinary business circumstances). The tax authorities could also evaluate the possibilities of alternatives such as MAP (to avoid double taxation), APA, and negotiations to achieve a consensus that could be in all parties’ interests;
  • Taxpayers must select the most appropriate transfer pricing model or transfer pricing method out of the five transfer pricing methodologies specified by the OECD to justify the arm’s length nature of the intercompany transaction or intercompany agreements. However, during the pandemic, the Guidance advocates the use of more than one transfer pricing model of transfer pricing methodology (as a corroborative analysis) to justify the arm’s length price of the controlled transaction;
  • Analyze and compare the pre and post-pandemic economic impact on the taxpayer and the comparable companies operating in similar economic conditions as long as the comparable companies’ data remain consistent, which does not distort results from pre and post-pandemic period;
  • Price adjustment in the subsequent periods – year-end TP adjustments (through invoicing or intercompany payments effectuated in a later period) could be made to satisfy the arm’s length result to the extent permissible by the domestic law. The potential issues such as VAT/Customs should be evaluated separately;
  • The Guidance emphasizes undertaking continued comparability of previously selected comparable companies for roll-forward reports or even revisiting the entire set if needed to reflect the economic impact on the industry; 
  • There is no overriding rule in accepting or rejecting a loss-making company as a comparable. If accurate delineation of the transaction can be made, such companies could be considered a potential comparable even after reporting losses.  

Losses and allocation of specific costs

While providing this Guidance, the OECD did not discuss in detail whether a limited risk entity or limited risk entities/arrangements could or should incur losses (including operational and exceptional costs). Instead, it would be dependent on the functions, assets, and risks (FAR) analysis of the limited risk entity on a case-to-case basis. The Guidance emphasized a consistent approach and accurate delineation (based on FAR) pre and post-pandemic in determining the allocation of profits and losses. 

The Guidance suggests MNE groups should revisit intercompany arrangements in addressing the pandemic. The revised terms must be consistent with the terms that would have been agreed or revised in an uncontrolled scenario between unrelated parties to reflect the parties best interest along with evidence to support the arm’s length principle. 

The allocation of operational and exceptional costs should be based on the FAR and making accounting adjustments to improve comparability. 

In addition, the impact of force majeure would purely depend on the language provided in the agreement’s force majeure clauses, and tax authorities should carefully consider it before invoking such measures in light of the controlled transaction’s economic circumstances. 

Government assistance programmes

OECD Guidelines for Transfer Pricing in Thailand 3 - Government assistance programmes

The extent to which the receipt of government assistance during the pandemic comes in different forms may impact TP in various ways. The receipt of government assistance cannot be assumed to impact the price of controlled transactions. A comparability analysis must be performed to account for economically relevant characteristics, government assistance conditions, etc. 

The government assistance programmes are unlikely to impact the allocation of risk in the intercompany transactions, although it reduces the negative impact of realizing a specific risk. Moreover, government assistance may affect the comparable and the arm’s length prices of uncontrolled transactions in various ways. The impact of government assistance should be evaluated before accepting a potential comparable.


Advance pricing agreement

Material and unanticipated changes in economic conditions caused by the pandemic have triggered critical assumptions made in the already agreed and concluded APAs. It is critical to assess and determine the impact of such changes in economic circumstances in concluded APAs or APAs under negotiation.  

Taxpayers are encouraged to adopt a collaborative and transparent approach by raising pandemic-related issues with the tax authorities promptly. 

The Guidance recommends that the tax authorities assess the impact on APAs on a case-to-case basis by providing suitable resolutions such as:

  • Revision – of existing APA’s to account for the changes;
  • Cancellation – APA’s would be effective until the cancellation date and not for the whole proposed period; and
  • Revocation – treat APA’s as never having been entered into. 

The Guidance suggests that both taxpayers and tax administrations negotiate APAs to cover FY2020 by adopting a flexible and collaborative approach accounting for current economic conditions. For example, agreeing on a short period APA covering the pandemic period specifically, and another APA covering the post-pandemic period.

Our comments

The Guidance discusses and provides valuable insight in tackling transfer pricing complexities experienced by taxpayers worldwide due to the current crisis and ensuing economic downturn. The Guidance also proposes that tax administrations adopt a flexible approach while evaluating the most appropriate outcome or computing arm’s length price for the pandemic period. In addition, it highlights the importance of alternatives such as MAP (to avoid double taxation), APA, and negotiations to achieve a consensus that could be in all parties’ interests in these challenging times.

The OECD clarified that this Guidance is not intended to expand or revise the existing OECD TPG, nor is it binding on any inclusive framework member. The Guidance merely serves as a guide that provides pragmatic approaches in order to address certain challenges, as there is no straightforward answer to one situation, and every condition/change must be analyzed and assessed on a case-by-case basis in the light of its associated facts and circumstances. 

As highlighted in our previous article, “The impact of COVID-19 on your Transfer Pricing Arrangements.”, the OECD in this Guidance emphasized the accurate delineation of FAR analysis to allocate operational and exceptional costs to the companies. This becomes important for Thailand, as most multinationals’ subsidiaries in Thailand operate as low-risk or routine entities, meaning they perform routine functions and assume routine risks compared to the entire value chain. Reasonable care and evidence are required to substantiate the low or loss positions of the low or routine Thai companies, as the Thai Revenue Department would expect a reasonable return on a year-on-year basis. 

As the Thai Revenue Department largely follows the OECD, we anticipate that the Thai Revenue Department would consider such practical approaches/examples during TP audit proceedings to address the challenges faced by taxpayers due to the pandemic. 

To learn more about the new OECD Guidance, along with the very latest tax treaty developments, join the HLB Global webinar on 27 April, 1pm-2pm BST.

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February 2021 Thailand Tax Update

HLB Thailand Tax Team


The Thai government continues to monitor the financial impact of the pandemic on the country’s economy and has announced several new tax concessions in response.

 Extended deadline for e-filing of WHT and VAT returns

 Monthly WHT returns and VAT returns filed electronically are normally due for filing within the 15th and 23rd of the next month respectfully.

 For monthly WHT returns and VAT returns filed electronically, which are normally due for filing during the months of February 2021 to June 2021, the filing date has been extended to the last day of the month.

 This extension therefore applies to withholding tax returns (PND 1, PND 2, PND 3, PND53) and VAT returns (Por Por 30 and Por Por 36) for the tax months of January 2021 to May 2021.

Extended deadline for e-filing of 2020 personal income tax returns

The deadline for filing personal income tax returns (PND 90 and PND91) electronically for the 2020 tax year has been extended to 30 June 2021. The deadline for filing a paper return has not been extended and remains 31 March 2021.

Social Security Contribution rate for employees reduced to 0.5%

Monthly contribution rates were reduced at the beginning of the year from 5% to 3% for both employers and employees for 3 months from January to March 2021.

A reduced contribution rate of 0.5% has now been announced for employees only for February and March 2021.

The monthly wage base for contributions ranges from Baht 1,650 to a maximum of Baht 15,000 for each employee. The maximum contribution for February and March 2021 for an employee will therefore be reduced to Baht 450 per month for the employer and to Baht 75 per month for the employee.

Land and building tax reduced by 90% 

Land and building tax payable for the 2021 year has been reduced by 90%. Land and building tax was also reduced by 90% last year due to the pandemic.

Property registration fees reduced to 0.01%         

The Thai Cabinet has approved another reduction of registration fees for the purchase of new residential properties from developers.

 The 2% transfer registration fee and the 1% mortgage registration fee will both be reduced to 0.01%, effective from 3 February 2021 to 31 December 2021. A similar fee reduction had expired on 24 December 2020.

 The mortgage must be registered at the same time as the transfer and the price and the mortgage must both not exceed Baht 3 million.

Duangnetr Sarachai

Principal, Tax & Legal Services


Radapak Arthapridi

Principal, Tax & Legal Services


Thailand’s new Transfer Pricing law: Assessing the risks for taxpayers

HLB Thailand Transfer Pricing Team


The new transfer pricing (TP) legislation in Thailand signals a tougher approach on TP, with the next step being its enforcement through tax audits.


Thailand’s Revenue Code has for a long time contained provisions to give revenue officers the power to assess transactions for tax purposes at market prices. Off the back of these provisions, the Revenue Department issued an instruction in 2002 to provide guidance on determining the market price of transactions between related parties. The instruction essentially followed the OECD’s TP guidelines.

To fulfill Thailand’s commitment as a member of the OECD’s Inclusive Framework on BEPS, legislation was introduced to codify the arm’s-length principle into the Revenue Code and impart specific powers to assessment officers to impose TP adjustments on either income or expenses arising from non-arm’s length transactions, effective for accounting periods starting on or after January 1 2019.

The legislation also introduced mandatory TP documentation requirements and filing of TP disclosure forms by certain taxpayers.

Recent developments

Transfer pricing regulations continued to evolve in 2020, with draft rules for country-by-country reporting released for public consultation. The draft rules propose making the report effective for accounting periods commencing on, or after January 1 2020.

In November 2020, a regulation was issued on the use of internal and external comparables, which aligned with the OECD’s TP guidelines. If internal comparables are not available, the regulation requires information on similar transactions between independent parties to be used, regardless of whether such transactions take place in or outside the country or are undertaken by domestic or foreign companies.

A clarification may be needed in the future on the circumstances in which foreign comparables will be acceptable, as the Thai Revenue Department has previously expressed a strong preference for the use of Thai comparables.

Disclosure requirements

Many companies in Thailand adopt a December 31 year end, and these companies would have filed disclosure forms for the first time in respect of their December 31 2019 financial year.

Only companies with Baht 200 million ($6.7 million) or more in revenues in an accounting period must file the disclosure form with the Revenue Department, disclosing details of their related parties and the transactions during the year with these parties.

The filing deadline was extended to August 31 2020 because of the pandemic and the Revenue Department then offered to reduce the penalty from Baht 200,000 ($6,900) to Baht 5,000 ($173) if the form was filed late due to the pandemic and it was filed electronically by December 31 2020.

The Revenue Department will now have significant data about taxpayers’ related party dealings in Thailand. That data will be analysed and used to formulate the next steps for determining the selection of taxpayers for TP audits. It is understood that the Revenue Department has already started to make enquiries to taxpayers.

Impact of COVID-19 on transfer pricing

By June 2021, the Thai Revenue Department will have received the second round of disclosure forms for the December 31 2020 financial year (Read more about online filing of Transfer Pricing disclosure forms)

In terms of analysing and identifying year on year trends, the Revenue Department will need to seriously consider the comparability of information that will be reported for the 2020 year, in light of the pandemic’s impact on trading conditions.

The information disclosed by taxpayers will likely not be sufficient to undertake meaningful analysis of year on year trends without requesting further information from taxpayers.

The new TP legislation grants the Revenue Department five years from the date of submission of the disclosure form to request additional information. The time given to reply is 60 days, extendable to 120 days but in the case of the very first request, the law grants a taxpayer 180 days to reply.

The Thai Revenue Department has not issued guidelines on the TP implications of COVID-19. The OECD issued a guidance at the end of 2020 under the OECD TP Guidelines, which was approved by Thailand, as a member of OECD’s Inclusive Framework. This guidance should be helpful in setting expectations in the event of a TP audit. (Read more about the impact of COVID-19 on transfer pricing).

Thailand is a manufacturing and distribution hub for many multinationals. Usually, their subsidiaries operate in Thailand as low risk or routine businesses, meaning they perform routine functions and assume routine risks as compared to the entire value chain.

The Thai Revenue Department may therefore expect a reasonable return on a year-on-year basis for such companies. As such, these companies should document the reasons for any decline in profitability due to the pandemic in their TP documentation, showing clearly how it was caused e.g. by lower capacity utilisation, lower market demand, exceptional fixed costs, or other factors.

The introduction of TP legislation and the new disclosure regime has likely caused multinationals to pay more attention to the pricing of their transactions with Thai based related parties. One of the first challenges for taxpayers and the Thai Revenue Department may concern the appropriateness of the TP documentation maintained to explain the impact of COVID-19 on trading results.




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January 2021 Thailand Tax Update

HLB Thailand Tax Team


Below you will find a summary of recent tax developments in Thailand plus a reminder of key reporting dates for employers in the next few months.

Social Security Contribution rate reduced to 3%

To provide relief from the impact of the Covid-19 pandemic, monthly contribution rates have been reduced from 5% to 3% for employers and employees for 3 months from January to March 2021.

The monthly wage base for contributions ranges from Baht 1,650 to a maximum of Baht 15,000 for each employee. The maximum contribution is therefore reduced to Baht 450 per month (normally Baht 750) from January to March 2021 for employers and employees. 

Reminder – upcoming employer obligations 

Employers are reminded to request details of deductions and allowances for the 2021 year from their employees (Form Lor Yor 01) for the purpose of computing income tax to be withheld from salaries and wages during the 2021 year.

Upcoming deadlines for reporting income paid to employees in the 2020 year are:

2021 workers compensation – important dates

Employers will be required to pay workers compensation premiums and make wages declarations as usual this year.

No extension planned for filing personal income tax returns

The Thai Revenue Department has no plans at the moment to extend the filing deadline for personal income tax returns for the 2020 year, according to news reports. The Revenue Department extended the deadline last year by 5 months. It believes the recent Covid-19 outbreak in Thailand will be contained in 2-3 months.

Personal income tax returns are due for filing by 31 March 2021, extended to Thursday 8 April 2021 for returns filed electronically.

Unemployment benefits

Unemployment benefits due to force majeure caused by the pandemic have been revised with effect from 19 December 2020.


Any questions?

If you would like to know more about the topics covered above please contact:

Duangnetr Sarachai: [email protected]

Radapak Arthapridi: [email protected]


Duangnetr Sarachai

Principal, Tax & Legal Services


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