Guide to Thailand VAT Taxability and Rates

This article explains how VAT applies to different types of sales in Thailand, including what rate applies, when reverse charge is used, and how B2B and B2C sales are treated differently.

Standard VAT Rate

The standard VAT rate in Thailand is 7%. This applies to taxable supplies of goods, services, and electronic services made within or imported into Thailand.

Exports of goods and services are zero-rated (0%), meaning VAT is charged at 0% and no VAT is remitted, though the supply is still technically a taxable supply.

How Taxability Is Determined: B2B vs. B2C

The buyer's VAT registration status is the key factor in determining how Thailand VAT applies to a sale.

Non-Resident Sellers: B2B Sales (Reverse Charge)

When a non-resident seller provides SaaS or electronic services to a Thai VAT-registered business (B2B), the reverse charge mechanism applies.

Under reverse charge:

• The seller does not charge Thai VAT on the invoice.

• The Thai buyer self-assesses the 7% VAT and remits it using Form P.P.36.

• The buyer may then claim an input tax credit on their Form P.P.30 monthly return in the same tax period.

• Recommended invoice notation: "Reverse charge — VAT to be self-assessed by buyer."

This applies whether the non-resident seller is VES-registered or not.

Non-Resident Sellers: B2C Sales (VES)

When a non-resident seller provides SaaS or electronic services to a non-VAT-registered consumer (B2C), the seller (or the platform facilitating the sale) must:

• Charge 7% VAT directly to the customer

• Register under the VES scheme once the THB 1.8 million annual threshold is crossed

• Remit the VAT to the Revenue Department monthly

Important: VES-registered sellers are not permitted to issue Thai tax invoices. Regular commercial invoices should show the VAT amount as a separate line item.

Resident Sellers: Domestic Sales

For resident businesses making domestic taxable supplies:

What Counts as an Electronic Service?

Thailand defines electronic services broadly to include software, digital applications, digital media (music, film, games), online courses via pre-recorded medium, web hosting, search engine services, online marketplace listing services, on-demand streaming, and digital advertising.

The definition excludes live teaching delivered by a teacher over the internet in real time, and professional consulting services delivered via email or video call where human judgment is essential.

Exempt Supplies

Certain supplies are VAT-exempt in Thailand and do not count toward the registration threshold. Common exempt categories include healthcare, education, and certain financial services subject to Thailand's Specific Business Tax (SBT).

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