Annual Compliance for Thai Companies Operating in India
India and Thailand elevated their bilateral relationship to a Strategic Partnership in April 2025, signalling deepening economic cooperation between South and Southeast Asia's two major economies. Bilateral trade reached $19.07 billion in FY 2024-25, and cumulative Thai FDI into India stands at approximately $1.47 billion since April 2000. Thai companies operate Indian subsidiaries across sectors including automotive components, food processing, petrochemicals, building materials, and hospitality — with companies like CP Group, SCG, Thai Union, and Indorama having significant Indian operations.
For these Thai parent companies, managing annual compliance for their Indian subsidiaries requires navigating a regulatory environment that differs substantially from Thailand's Board of Investment (BOI) and Revenue Department framework. India's compliance obligations span four regulators: the Ministry of Corporate Affairs (MCA) for corporate law, the Income Tax Department for direct taxes, the GST Network for indirect taxes, and the Reserve Bank of India (RBI) for foreign exchange management.
A distinctive feature of the India-Thailand DTAA is the absence of a separate article on Fees for Technical Services (FTS) — unlike most of India's DTAAs. This has significant compliance implications that Thai companies must understand. This guide covers every annual compliance requirement for FY 2026-27. Read our blog on annual compliance checklist for Indian companies for a month-by-month schedule.
How the India-Thailand DTAA Affects Annual Compliance
The India-Thailand DTAA, signed on July 29, 2015, and in force since October 13, 2015, governs the tax treatment of cross-border payments between Indian subsidiaries and their Thai parent companies. This is a relatively modern treaty that incorporates contemporary OECD provisions.
Withholding Tax Rates Under the Treaty
The Indian subsidiary must deduct withholding tax (TDS) on payments to the Thai parent at the applicable treaty rate:
- Dividends: 10% on gross dividend amount. India's domestic withholding rate is 20%, so the treaty provides a 10 percentage point saving on profit repatriation to Thailand.
- Interest: 10% on interest payments. Thai banks and financial institutions lending to Indian subsidiaries benefit from this reduced rate compared to India's domestic rate of 20%.
- Royalties: 10% on royalties for use of industrial, commercial, or scientific equipment, trademarks, patents, or copyrights.
- Fees for Technical Services: No separate FTS article exists in the India-Thailand DTAA. This means management fees, consulting fees, and technical service charges from India to Thailand are not subject to withholding tax under the treaty, provided the Thai company does not have a Permanent Establishment (PE) in India. If no PE exists, such payments are treated as business profits taxable only in Thailand.
The FTS Gap — A Critical Compliance Consideration
The absence of a separate FTS article is both an advantage and a compliance risk. While it means no withholding tax on genuine technical service fees (if no PE exists), Indian tax authorities may challenge this position during assessments. The Supreme Court of India in its landmark rulings has held that if a DTAA does not contain a separate FTS article, such income falls under the Business Profits article and is taxable only in the country of residence. However, the Indian subsidiary must maintain robust documentation proving the absence of a PE in India for the Thai service provider. Read our comparison of DTAA vs domestic tax rates.
TRC from Thai Revenue Department — Annual Requirement
To claim treaty-rate TDS, the Thai parent must obtain a Tax Residency Certificate (TRC) from the Thai Revenue Department (Krom Srrphakorn) each year. The Thai parent must also ensure Form 10F is filed electronically on the Indian income tax portal, along with a self-declaration confirming beneficial ownership.
Document Requirements from Thailand
Thailand is not a member of the Hague Apostille Convention, although the Thai government approved accession to the Convention in December 2025 — the effective date is pending ratification. Until Thailand officially becomes a member, all Thai documents intended for use in India must undergo embassy attestation through the Ministry of Foreign Affairs (MFA) of Thailand and the Indian Embassy in Bangkok.
Annual Documents from the Thai Parent
- Thai Revenue Department TRC: Valid for the relevant tax year. Must be renewed annually before treaty-rate TDS deductions commence for the Indian financial year.
- Board Resolutions: Annual resolutions authorizing intercompany transactions (management fees, royalties, loan interest) — notarised and attested through MFA Thailand and the Indian Embassy.
- DBD Annual Return: The Department of Business Development (DBD) annual return, filed by Thai companies under the Civil and Commercial Code — embassy-attested copy may be requested by Indian auditors.
- Transfer Pricing Master File: If the Thai group's consolidated revenue exceeds INR 500 crore, a global master file must be maintained and furnished to Indian tax authorities upon request.
Director KYC for Thai Directors
- DIR-3 KYC is due by September 30 for every director holding a DIN. Thai directors submit passport details, proof of Thai residential address, personal mobile number, and email.
- Thai national ID card number may be requested as additional identification by Indian compliance professionals.
Step-by-Step Annual Compliance Process
India's financial year (April 1 - March 31) governs all compliance timelines. Thai-owned Indian subsidiaries must complete the following sequence each year:
Step 1: Statutory Audit (April - August)
A statutory audit by an independent Indian Chartered Accountant is compulsory for every private limited company. For Thai-owned subsidiaries, the auditor specifically reviews intercompany transactions — particularly the treatment of FTS payments given the DTAA's unique FTS position — FEMA compliance, and related-party disclosures under Section 188 of the Companies Act. Read our guide on statutory audit requirements for foreign subsidiaries.
Step 2: Annual General Meeting (By September 30)
The AGM adopts audited financial statements, considers dividends, and reappoints the auditor. Thai directors can attend via video conferencing. The AGM must be held within six months of the financial year end.
Step 3: MCA Annual Filings (October - November)
- Form AOC-4: Financial statements filed with ROC within 30 days of AGM.
- Form MGT-7: Annual return filed within 60 days of AGM.
Late filing attracts INR 100 per day per form with no maximum cap. Thai companies accustomed to the DBD's more lenient penalty structure should note that Indian penalties are unlimited and apply to both the company and individual officers in default.
Step 4: Income Tax Return (October 31 / November 30)
ITR-6 is filed by October 31 (or November 30 for companies with transfer pricing obligations). Form 3CEB — the transfer pricing audit report — is due by November 30. Thai-owned subsidiaries with intercompany transactions invariably require transfer pricing compliance, particularly for service fee payments where the DTAA's no-FTS-article position is claimed.
Step 5: GST Annual Return (December 31)
GSTR-9 (and GSTR-9C for turnover above INR 5 crore) is due by December 31. Monthly GSTR-1 and GSTR-3B filings continue throughout the year. See GST compliance services.
Step 6: FEMA and RBI Reporting (July 15)
The FLA Return is filed with RBI by July 15 through the FLAIR portal. Any share allotments, transfers, or capital restructuring must be reported through FC-GPR or FC-TRS within prescribed timelines.
Timeline and Costs
Compliance Calendar
| Obligation | Deadline | Regulator |
|---|---|---|
| DIR-3 KYC (all directors) | September 30 | MCA |
| Statutory audit completion | Before AGM | ICAI |
| Annual General Meeting | September 30 | MCA |
| Form AOC-4 | Within 30 days of AGM | MCA/ROC |
| Income Tax Return (ITR-6) | October 31 | Income Tax Dept |
| Form MGT-7 | Within 60 days of AGM | MCA/ROC |
| Transfer Pricing Report (3CEB) | November 30 | Income Tax Dept |
| GST Annual Return (GSTR-9) | December 31 | GSTN |
| FLA Return to RBI | July 15 | RBI |
| TDS Returns (quarterly) | Jul 31, Oct 31, Jan 31, May 31 | Income Tax Dept |
Cost Breakdown
| Service | Approximate Annual Cost |
|---|---|
| Statutory audit fees | INR 50,000 - 2,00,000 (~THB 21,000-84,000) |
| MCA annual filing (AOC-4 + MGT-7) | INR 15,000 - 30,000 (~THB 6,300-12,600) |
| Income tax return preparation | INR 25,000 - 75,000 (~THB 10,500-31,500) |
| Transfer pricing documentation and 3CEB | INR 1,00,000 - 5,00,000 (~THB 42,000-2,10,000) |
| GST annual return (GSTR-9/9C) | INR 15,000 - 50,000 (~THB 6,300-21,000) |
| FEMA/RBI compliance (FLA, FC-GPR) | INR 20,000 - 50,000 (~THB 8,400-21,000) |
| DIR-3 KYC for foreign directors | INR 5,000 - 10,000 (~THB 2,100-4,200) |
India's compliance costs are substantially lower than equivalent services in Bangkok. Read our annual compliance checklist.
Common Challenges for Thai Companies
No FTS Article — Litigation Risk
The most distinctive compliance challenge for Thai companies is the India-Thailand DTAA's lack of a separate Fees for Technical Services article. While this theoretically means no Indian withholding tax on technical service payments (absent a PE), Indian tax officers routinely challenge this position during assessments, attempting to tax FTS under domestic law provisions at 20%. Thai companies must maintain comprehensive documentation — including the PE analysis, treaty interpretation, and judicial precedents (such as the Karnataka High Court's ruling in Infosys v. DCIT) — to defend the no-withholding position. Budget for potential tax disputes in your compliance planning.
Embassy Attestation Until Apostille Accession
Although Thailand approved accession to the Hague Apostille Convention in December 2025, the convention has not yet entered into force for Thailand. Until it does, all Thai documents require embassy attestation — a process involving notarisation, MFA authentication, and Indian Embassy attestation in Bangkok, typically taking 2-4 weeks. Thai companies should plan document authentication well in advance of Indian compliance deadlines.
TFRS to Ind AS Reconciliation
Thailand uses Thai Financial Reporting Standards (TFRS), which have been substantially converged with IFRS since 2015. India's Ind AS is also IFRS-based, so the reconciliation between the Indian subsidiary's Ind AS financials and the Thai parent's TFRS accounts is manageable. However, India-specific carve-outs — particularly around exchange difference capitalisation under Ind AS 21 and the Schedule III format for financial statements — require careful tracking during consolidation.
BOI Incentive Mindset vs Indian Tax Complexity
Thai companies accustomed to the Board of Investment (BOI) incentive framework in Thailand — with its straightforward tax holidays and investment promotion certificates — often find India's compliance environment challenging. India's multiple overlapping regulators, aggressive penalty structures, and extensive documentation requirements represent a fundamentally different regulatory philosophy. Thai CFOs managing Indian subsidiaries remotely should invest in local compliance expertise rather than attempting to manage Indian filings from Bangkok.
GST on Imported Services
When the Thai parent provides services to the Indian subsidiary (management services, IT support, technical assistance), the Indian subsidiary must pay GST under the reverse charge mechanism at 18% on the service value. Even though the DTAA may exempt these fees from income tax withholding, the GST reverse charge obligation remains. This distinction between income tax and GST treatment is a common source of confusion for Thai companies.
Why Choose BeaconFiling
BeaconFiling provides end-to-end compliance management for Thai-owned Indian subsidiaries. We serve Thai conglomerates, manufacturing companies, and mid-market businesses with Indian operations across every compliance vertical — MCA filings, statutory audit coordination, income tax and transfer pricing (including FTS treaty analysis), GST, and FEMA/RBI reporting. Our team understands the unique features of the India-Thailand DTAA, including the no-FTS-article position and its litigation implications.
Schedule a free consultation to discuss your Indian subsidiary's compliance needs, or explore our annual compliance service for details.