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ResourcesCorporate and Tax AdvisoryThailand Corporate LawRollover of Losses on BOI Companies in Thailand

Rollover of Losses on BOI Companies in Thailand

Transcript of the above video:

As the title of this video suggests we are discussing BOI Companies; BOI stands for the Board of Investment. In the Kingdom of Thailand, the Board of investment is tasked with promoting businesses that will benefit the Kingdom of Thailand and by their powers and their sort of Charter, for lack of a better term they can basically hand out substantial benefits to Companies that are qualified to do business in Thailand and that will bring in various benefits to the Kingdom that sort of, for lack of a better term, “punch above the weight” of just a regular small business or medium sized Corporation doing business there in the Kingdom. So things like highly technologically-advanced type of companies or various manufacturing types of concerns; there is a whole list of types of companies and types of corporate endeavors that the BOI is looking to promote here in the Kingdom.

That being said, one of the major benefits that can be gained as a result of BOI promotion are various tax benefits. Most notably there are tax holidays which can be garnered as a result of BOI promotion; I did a video specifically on tax holidays also on this channel. As well as tax holidays, you have also got sort of rollovers, what they also call rollovers, which basically means depending on how what the provisions of the BOI promotion are, it may be possible to roll over losses from one year into another fiscal year in order to offset possible profits of that next fiscal year. So for this reason, BOI can be very, very beneficial because you basically can have one year where there was a substantial amount of loss in the company, this is often times the case in the first year or multiple years where a company is sort of getting on its feet and then later on there may be a good profit margin, there may be substantial profit and notwithstanding the tax holidays that are garnered as a result of the tax holiday inherent in the BOI's approval, the rollover may actually result in even further mitigation of taxes depending on how long the tax holidays last and the terms and conditions of the rollover itself.

So for this reason, these rollovers in many ways sort of almost kind of magnify the tax benefits which may even be garnered under a direct tax holiday because losses can be used to offset profits in such a way that basically the company doing business in Thailand sees a real boon relative to doing business in another jurisdiction.