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

HLB Thailand Tax Team

image

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

Get in touch

Whatever your question our team will point you in the right direction

Start the conversation

Proposed amendments to Public Limited Company Act approved

HLB Thailand Legal Team

Public Limited Company Act Thailand

The Thai cabinet recently approved proposed amendments to the Public Limited Company Act that will allow public companies to use electronic means to hold meetings and communicate with shareholders.

 The amendments proposed include:

  • Flexibility to call meetings or send information to directors, shareholders and creditors electronically
  • Allowing meetings of directors and shareholders to be held via electronic media
  • Enabling shareholders to appoint a proxy electronically for shareholder meetings

Advertising and issuance of notices electronically

Where a public company is required or allowed to advertise any information to relevant persons in a local newspaper it must do so for at least 3 days consecutively and must send notices, letters etc. by hand or registered mail.

The draft amendment provides an option to place advertisements through electronic means according to the criteria stipulated by the Director General of the Department of Business Development and to send documents electronically to directors, shareholders and creditors who have declared their intention or given their consent to receive documents electronically, provided that the company or the board of directors comply with the criteria stipulated by the Director General.

Holding shareholder meetings online

The draft amendment allows a public company to hold shareholder meetings via electronic means if the meeting is held in accordance with the laws regarding e-meetings and it is not otherwise prohibited under its Articles of Association.

If the shareholder meeting is held via electronic means, it is deemed to have been held at the head office of the company.

E-proxy for shareholder meetings

The draft amendment allows a shareholder to appoint a proxy by electronic means provided that the methods used are safe and ensure that such appointment has been made by the shareholder, subject to the criteria stipulated by the Director General.

Holding meetings of directors online

The Act currently requires meetings of directors to be held at least once every three months at the head office of the company or a nearby province unless the Articles of Association requires the meeting to be held elsewhere. The draft amendment adds a restriction that if a meeting is to be held elsewhere, it must still be held in Thailand.

The draft amendment allows meetings of directors to be held via electronic means if the meeting is held in accordance with the laws regarding e-meetings and it is not otherwise prohibited under the company’s Articles of Association.

Summoning meetings of directors

The draft amendment also makes changes in general to the rules for summoning meetings of directors.

The notice period for calling a meeting of directors is reduced from seven days to three days. A shorter notice period for necessary or urgent matters is still available. In case there is no chairman of the board, meetings of directors shall be summoned by the deputy chairman and if there is no deputy chairman, at least two directors may jointly call a meeting.

Under the current Act, if a request is made by at least two directors to summon a meeting of directors, the chairman shall fix the date of the meeting within fourteen days from the date of the request.

This will be amended so that at least two directors may jointly request the chairman to summon a meeting only if there are justifiable grounds or in order to protect the rights or benefits of the company. If the chairman does not call the meeting within 14 days, the directors who made the request can call the meeting themselves.

Get in touch

Whatever your question our team will point you in the right direction

Start the conversation

Thailand clarifies rules for use of internal and external comparables

HLB Thailand Transfer Pricing Team

Thailand’s Ministry of Finance has issued a Ministerial Regulation under the Revenue Code prescribing the approach Thai tax officers should take when analysing and adjusting the pricing of transactions between related parties.

Ministerial Regulation 369 dated 6 November requires tax officers to first consider similar transactions that the taxpayer has made with third parties (internal comparables) if they are available.

If the taxpayer does not have comparable transactions with third parties, the tax officer shall then be required to use information concerning similar transactions between independent parties regardless of whether such transactions take place in or outside the country or are undertaken by domestic or foreign companies.

The regulation’s guidance on when to use internal and external comparables is a welcome move and is aligned with the OECD’s transfer pricing guidelines. Whislt its purpose is to provide instructions for tax officers to follow during transfer pricing audits, the regulation also assist taxpayers in determining the approach they should take to preparing their transfer pricing documentation.

The regulation gives the Director General of Revenue the power to issue further rules, procedures and conditions regarding its application. We expect that a clarification may be needed in the future on the circumstances in which foreign comparables will be acceptable, as the Thai tax office has previously expressed a strong preference for the use of Thai comparables.

Ministerial Regulation 369 also contains a very wide definition of “commercial or financial conditions”, that shall be used when considering whether such conditions made between related parties are different to those that would be made if they were operating independently of each other. The regulation then spells out the conditions that must be satisfied in determining that there has been a transfer of profit as a result of such difference in commercial or financial conditions.

Get in touch

Whatever your question our team will point you in the right direction

Start the conversation
Get in touch
x
x

Share to:

Copy link:

Copied to clipboard Copy