Complete Defense Guide: How to Prepare for a Tax Audit by the Thai Revenue Department Systematically
Understanding the Tax Audit Process
Receiving a letter or summons from The Revenue Department (Thai Tax Authority) for a tax audit is a significant concern for businesses and individuals alike. Incorrect handling can lead to substantial retroactive tax assessments and high penalties. Consulting a Tax Law Attorney from the outset is crucial to ensuring a lawful examination and mitigating legal risks.
Step 1: Responding and Appointing Representation
Managing the audit from the start correctly is vital:
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Notify and Appoint Counsel: Immediately upon receiving the audit summons, notify your attorney in the Tax Law Department. Your attorney can act as your authorized representative to coordinate and respond to all inquiries, ensuring every answer is legally sound and serves your best interest.
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Verify Scope and Authority: Verify the identity of the conducting officers and the specific tax years under review. This ensures the procedure complies with the Tax Court Establishment Act.
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Scheduling and Location: Request a reschedule (if necessary) and arrange for the examination to take place at your law firm’s office or a suitable external location, rather than directly at your business premises.
Step 2: Preparing Relevant Documentation and Evidence
The Revenue Department meticulously examines the following documents, especially those related to Value Added Tax (VAT) and Corporate Income Tax:
2.1 Accounting and Tax Documents
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All relevant ledgers and account books.
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Financial statements and trial balances for the audited year(s).
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VAT input/output tax invoices, receipts, and withholding tax certificates.
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2.2 Legal and Contractual Documents
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Contracts (e.g., sale agreements, loan agreements, employment contracts) used for accounting entries.
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Company registration documents and VAT registration evidence.
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Step 3: Handling Objections and Tax Litigation
During the audit and after receiving a Tax Assessment Order (if applicable):
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Controlled Information Disclosure: Provide only the information formally requested in writing by the officers, and ensure it is reviewed by your attorney beforehand.
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Analyzing the Assessment Order: If you receive an unfair Tax Assessment Order, the Tax Law Department will analyze its compliance with the Thai Revenue Code.
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Appeals and Litigation: If the assessment is incorrect, we will file a formal Appeal Petition to the Appeals Committee. Should this be unsuccessful, we are prepared to represent you in litigation before the Tax Court to fully protect your rights.
Mitigate Your Tax Risk
Handling a tax audit alone carries a high risk of penalties and retrospective assessments. Our Tax Law Attorneys specialize in effectively managing disputes with The Revenue Department for businesses and individuals.
