Taxation Scheme on the Establishment of Joint Venture Investment Funds

The Thai government has come up with many Joint Venture Investment funds with an objective to promote new investment in the Thai capital market.  This page reviews and provides a comparison on taxation and special incentives that incur for an establishment of joint venture investment funds under the Mutual Fund regulatory and tax structure.  Most of the Joint Venture Investment funds which were recently sat up such as Matching Funds, Thailand Opportunity Fund and Thailand Equity Fund were established under the mutual fund regulatory and tax structure.

Taxable Income of Mutual Funds

Established under Securities & Exchange Act. B.E.2535 (1992)

Recipient Interest Income Dividend Income Capital Gain Mutual Fund Exempt Exempt Exempt

Taxable Income of Investors investing in Mutual Funds Established under Securities & Exchange Act. B.E.2535 (1992)

Recipient Dividend Income Capital Gain Thai Individual Investors a. Recipients pay 10% withholding tax and exclude the item from other taxable personal incomes b. Not pay 10% withholding tax and include the item with other taxable personal incomes. Exempt Thai Corporate Investors 1. No withholding tax 2. Corporate income tax 2.1 Dividend received from mutual funds, where the share are held by the recipient for not less than 3 months before and after dividend payment, are subject to the following; - Listed Company: recipients are exempt from corporate income tax. - Non-Listed Company: recipients are exempt from corporate income tax on amounts of 50% of such dividend 2.2 If the holding period is less than 2.1, recipients must include the dividend income with other corporate income, which are subject to corporate income tax at the rate of 30%.   Foreign Individual Investors i No withholding tax Exempt Foreign Corporate Investors ii No withholding tax No withholding tax

i. Alien who has never been in Thailand or who has been in Thailand for not more than 180 days. If they have been in Thailand more than 180 days, their income is subject to taxation at the same rate as Thai Investor. ii. Foreign institution not doing business in Thailand.