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Thailand: Functional currency for income tax purposes

Thailand: Functional currency for income tax purposes

The Director-General of the Thai Revenue Department in late May 2020 issued a notice (No. 373) to provide guidelines on the requirements for application of companies and juristic partnerships to adopt a currency other than Thai Baht as their functional currency for income tax purposes.

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  • Change of functional currency from Thai Baht to other currency: Companies or juristic partnerships that adopt a currency other than the Thai Baht as a functional currency for purposes of income tax compliance must comply with certain requirements. For instance, the functional currency must be adopted for accounting report preparation and in accordance with accounting principles and certified by a certified auditor or a certified tax auditor that the currency is the functional currency. Also, the functional currency must be one listed prescribed by the Ministry of Finance, and there are other requirements to be satisfied.
  • Subsequent change of the functional currency: Companies or juristic partnerships that have provided notice of the adoption of a currency other than the Thai Baht as the functional currency and that subsequently seek to change the functional currency must comply with additional requirements.
  • Conversion of cash, assets or liabilities using exchange rates other than those from the Bank of Thailand: Companies or juristic partnerships that seek to convert cash, assets or liabilities remaining in the last day of accounting period into the functional currency by using exchange rates that are not ascertained from the Bank of Thailand must comply with other requirements.


Read a June 2020 report prepared by the KPMG member firm in Thailand

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