Tax Filing for Thai Companies in India
Thailand is India's 27th largest foreign investor, with cumulative FDI inflows of US$1.47 billion since 2000 and bilateral trade touching US$19.07 billion in FY25. In April 2025, India and Thailand upgraded their relationship to a strategic partnership at the BIMSTEC Summit, signalling deeper economic integration across infrastructure, automotive, food processing, renewable energy, and hospitality sectors.
Thai companies such as CP Group, PTT, Siam Cement, and Bangkok Bank have established significant operations in India through wholly-owned subsidiaries, joint ventures, and branch offices. Every such entity must comply with India's comprehensive tax filing obligations under the Income Tax Act, 1961, the GST Act, and FEMA regulations — encompassing monthly GST filings, quarterly TDS returns, quarterly advance tax payments, and annual income tax returns.
Beacon Filing provides specialised tax filing services for Thai companies operating in India, ensuring all cross-border payments are optimised under the India-Thailand DTAA while maintaining full statutory compliance from day one.
How Thailand's DTAA Affects Tax Filing
The India-Thailand Double Taxation Avoidance Agreement — first concluded in 1985 and replaced by the revised treaty signed on 29 June 2015, effective in India from 1 April 2016 — governs withholding tax rates on cross-border payments between your Indian subsidiary and the Thai parent entity. Understanding these treaty provisions is essential for accurate TDS deduction, advance tax computation, and income tax return preparation.
Withholding Tax Rates Under the DTAA
When your Indian subsidiary remits payments to the Thai parent, the following DTAA rates apply:
- Dividends: 10% — compared to India's domestic withholding rate of 20%. This uniform rate applies regardless of the Thai parent's shareholding percentage in the Indian subsidiary.
- Interest: 10% — applicable on all interest payments including intercompany loans, bonds, and debentures from the Indian entity to the Thai parent.
- Royalties: 10% — covers payments for use of patents, trademarks, designs, models, know-how, and software licences from the Thai parent.
- Fees for Technical Services (FTS): The India-Thailand DTAA has no separate FTS article — management fees, technical assistance, engineering services, and shared service charges paid to the Thai parent fall under domestic law (s.115A, 20% withholding) or, where the Thai parent has a PE in India, the Article 7 business-profits article.
These treaty rates provide a significant reduction from India's domestic withholding tax rates on dividends, interest, and royalties, and must be correctly reflected in every TDS return (Form 27Q) filed by the Indian subsidiary.
Permanent Establishment (PE) Considerations
Under Article 5 of the India-Thailand DTAA, a Thai company may create a permanent establishment in India through a fixed place of business, a construction site lasting more than 183 days, or employees providing services in India for more than 183 days in any 12-month period. A PE triggers tax filing obligations on business profits attributable to the Indian PE, requiring detailed profit attribution and transfer pricing documentation.
Claiming Treaty Benefits
To claim reduced DTAA rates, the Thai entity must furnish a Tax Residency Certificate (TRC) from Thailand's Revenue Department. The Indian subsidiary must file Form 10F alongside the TRC with Indian tax authorities before applying treaty rates to any cross-border payment.
Document Requirements from Thailand
Thailand deposited its instrument of accession to the Hague Apostille Convention on 30 June 2026, but the convention enters into force for Thailand only on 28 February 2027. Until then, Thai documents require the traditional consular legalization process: notarisation, attestation by Thailand's Ministry of Foreign Affairs, and authentication by the Indian Embassy in Bangkok.
Documents for Tax Filing Setup
- Certificate of Registration (Affidavit of the Company) from Thailand's Department of Business Development — notarized, attested by Thailand's MFA, and authenticated by the Indian Embassy in Bangkok
- Board Resolution authorizing appointment of an Indian Chartered Accountant for tax compliance — notarized and embassy-attested
- All intercompany agreements (management services, technical assistance, royalties, loans) — these are critical for transfer pricing documentation and must specify scope, pricing, and arm's length benchmarking methodology
- Thai parent's audited financial statements — required for transfer pricing master file and country-by-country reporting
- Power of Attorney for local representatives handling income tax, GST, and MCA filings — notarized and embassy-authenticated
Annual Documents
- Tax Residency Certificate from Thailand's Revenue Department — renewed annually
- Form 10F — self-declaration filed with Indian tax authorities
- Digital Signature Certificate (DSC) — mandatory for electronic filing of income tax returns, GST returns, and MCA forms
Step-by-Step Tax Filing Process
Here is the structured tax filing process Beacon Filing follows for Thai-owned Indian entities:
Step 1: Tax Registration
Obtain a Permanent Account Number (PAN) and Tax Deduction Account Number (TAN) from the Income Tax Department. Complete GST registration if the entity's aggregate turnover exceeds the threshold (INR 20 lakh for services, INR 40 lakh for goods). Procure Digital Signature Certificates for authorised signatories to enable e-filing on the income tax portal, GST portal, and MCA portal.
Step 2: Monthly GST Compliance
File GSTR-1 (outward supplies) by the 11th and GSTR-3B (summary return with payment) by the 20th of each month. Evaluate reverse charge mechanism applicability on services imported from the Thai parent — management fees, IT support, and technical assistance received from Thailand trigger GST liability on the Indian entity at the applicable rate (typically 18%).
Step 3: TDS Deduction and Filing
Deduct TDS on all applicable payments — salaries (Form 24Q), payments to Indian residents (Form 26Q), and cross-border payments to the Thai parent (Form 27Q). Apply the DTAA rate of 10% on dividends, interest, and royalties paid to the Thai parent, provided valid TRC and Form 10F are on file; FTS payments have no treaty rate and are withheld under domestic law (s.115A, 20%) or Article 7. Deposit TDS by the 7th of the following month and file quarterly returns by the end of the month following each quarter (31 May for the January-March quarter).
Step 4: Advance Tax Payments
Compute and pay advance tax in four quarterly instalments — 15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15. Non-payment or underpayment triggers interest under Sections 234B and 234C of the Income Tax Act.
Step 5: Annual Income Tax Return
File ITR-6 by October 31 (companies subject to statutory audit) or November 30 (if a transfer pricing report under Form 3CEB applies). Include all income streams, deductions claimed, TDS credits, advance tax payments, and foreign tax credit claims under the DTAA. Attach the tax audit report (Form 3CA/3CB and 3CD) if turnover exceeds INR 10 crore.
Step 6: Transfer Pricing Reporting
File the transfer pricing report (Form 3CEB) by October 31, covering all international transactions between the Indian subsidiary and the Thai parent or other associated enterprises. Maintain a master file, local file, and country-by-country report as applicable.
Timeline & Costs
Setup Timeline
| Activity | Duration |
|---|---|
| PAN and TAN registration | 5-7 business days |
| GST registration | 5-10 business days |
| Digital Signature Certificate | 2-3 business days |
| Tax compliance system setup | 3-5 business days |
| First return filing | Within applicable deadline |
Annual Compliance Calendar
| Filing | Frequency | Deadline |
|---|---|---|
| GST returns (GSTR-1, GSTR-3B) | Monthly | 11th and 20th of following month |
| TDS deposit | Monthly | 7th of following month |
| TDS returns (24Q, 26Q, 27Q) | Quarterly | Month-end following each quarter (31 May for Q4) |
| Advance tax instalments | Quarterly | June 15, Sep 15, Dec 15, Mar 15 |
| Income tax return (ITR-6) | Annual | October 31 (audit) / November 30 (with TP report) |
| Tax audit report | Annual | September 30 |
| Transfer pricing report (3CEB) | Annual | October 31 |
| GST annual return (GSTR-9) | Annual | December 31 |
| FLA return to RBI | Annual | July 15 |
Cost Breakdown
| Service | Approximate Annual Cost |
|---|---|
| GST return filing (monthly) | INR 3,000 - 8,000/month (~$36-96) |
| TDS return filing (quarterly) | INR 2,000 - 5,000/quarter (~$24-60) |
| Income tax return (ITR-6) | INR 15,000 - 50,000/year (~$180-600) |
| Tax audit (Section 44AB) | INR 25,000 - 75,000/year (~$300-900) |
| Transfer pricing documentation | INR 1,00,000 - 3,00,000/year (~$1,200-3,600) |
| Advance tax computation | INR 10,000 - 25,000/year (~$120-300) |
Common Challenges for Thai Companies
Document Legalization Uncertainty
Thailand acceded to the Hague Apostille Convention on 30 June 2026, but the convention enters into force for Thailand only on 28 February 2027. Until then, Thai companies must use the multi-step consular legalization process — notarisation, Thai MFA attestation, and Indian Embassy authentication — which can take 4-6 weeks. Companies should plan document authentication well in advance of Indian filing deadlines.
Misaligned Tax Years
Thailand allows companies to select their accounting period, though most Thai companies follow the calendar year (January-December). India mandates April-March. This misalignment creates overlapping reporting periods, with Thai parent companies needing Indian subsidiary data for Q4 consolidation while the Indian entity is still in the middle of its financial year. Check our blog on 12 compliance deadlines foreign companies miss.
PE Risk from Employee Deployments
Thai companies deploying engineers, technicians, or project managers to India for extended periods risk triggering a permanent establishment. Under the India-Thailand DTAA, services rendered in India for more than 183 days in any 12-month period constitute a PE, creating separate tax filing obligations and profit attribution complexities. Companies must carefully track employee deployment days.
Reverse Charge GST on Thai Parent Services
When the Thai parent provides management, IT, or technical services to the Indian subsidiary, the Indian entity must self-assess and pay GST under the reverse charge mechanism. Failure to correctly account for reverse charge GST triggers interest at 18% per annum and potential penalties. Read our detailed guide on GST for foreign companies — 40 questions answered.
Transfer Pricing for Intra-Group Services
India's tax authorities scrutinise intercompany transactions between Indian subsidiaries and their ASEAN parents, especially management fees, cost allocations, and intra-group charges. Thai companies must benchmark all transactions at arm's length and maintain contemporaneous documentation. Read our blog on 7 transfer pricing mistakes that trigger a tax audit.
Why Choose Beacon Filing
Beacon Filing specialises in tax filing for Thai-owned Indian entities. Our team of Chartered Accountants manages all statutory filings — income tax, GST, TDS, advance tax, transfer pricing, and FEMA reporting — while ensuring every intercompany payment is optimised under the India-Thailand DTAA. We have served Thai companies across sectors including automotive parts, food processing, hospitality, and construction materials, and understand the specific challenges of Thai document legalization and ASEAN-related structuring.
Schedule a free consultation to discuss your Indian subsidiary's tax filing needs, or explore our tax filing services for a complete overview.