Deductible Business Expenses
| Nature of Expense | Conditions/Requirements | Applicable Law |
|---|---|---|
| Operational Costs | Incurred in the ordinary course of business. | Thai Revenue Code (Section 65) |
| Employee Salaries | Reasonable and directly related to business operations. | Thai Revenue Code (Section 65) |
| Marketing Expenses | Incurred for the promotion and advertising of products or services. | Thai Revenue Code (Section 65) |
| Rent and Lease Payments | Paid for business premises or equipment. | Thai Revenue Code (Section 65) |
| Utilities | Expenses related to electricity, water, and other utilities for business premises. | Thai Revenue Code (Section 65) |
| Depreciation | Depreciation of tangible assets used in business operations, with special methods for certain assets. | Thai Revenue Code (Section 65) |
Non-Deductible Business Expenses
| Nature of Expense | Rationale for Non-Deductibility | Applicable Law |
|---|---|---|
| Fines and Penalties | Punitive in nature and not incurred for business purposes. | Thai Revenue Code (Section 65) |
| Personal Expenses | Expenses incurred for personal purposes unrelated to business activities. | Thai Revenue Code (Section 65) |
| Political Contributions | Considered as contributions to political activities rather than business expenses. | Thai Revenue Code (Section 65) |
| Entertainment Expenses | Expenses related to entertainment or recreation not directly related to business operations. | Thai Revenue Code (Section 65) |
| Illegal Payments | Payments made for illegal activities or purposes. | Thai Revenue Code (Section 65) |
| Donations to Non-Qualified Organizations | Contributions to organizations not meeting the criteria for tax-deductible donations. | Thai Revenue Code (Section 65) |
Expenses with Limitations on Deductibility
| Nature of Expense | Limitations Applied | Applicable Law |
|---|---|---|
| Interest Payments | Deductible up to a certain percentage of the assessable income. | Thai Revenue Code (Section 65) |
| Depreciation of Luxury Cars | Limited to a specific depreciation rate or maximum value for luxury vehicles. | Thai Revenue Code (Section 65) |
| Entertainment Expenses | Limited to a certain percentage of total expenses or subject to specific conditions. | Thai Revenue Code (Section 65) |
The legal provisions on these expenses aim to support legitimate business activities while preventing abuse or misuse of tax deductions for personal or non-business purposes:
- The Thai Revenue Code (Section 65) governs the treatment of business expenses for tax purposes.
- The Code specifies allowable deductions, exclusions, and limitations on deductibility to ensure fairness and consistency in tax assessments.
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