Page 189 - Social Enterprise A New Business Paradigm for Thailand

6.3 Organizations That Operate for Profit or Revenue Sharing
Limited companies, public limited companies, and partnerships are profit-driven, revenue-sharing

entities widely recognized in the business sector. This section focuses specifically on the tax
benefits and regulatory provisions available to companies or partnerships that engage in
Corporate Social Responsibility (CSR) activities.

1. General CSR Expenses Eligible for a 1x Tax Deduction, Up to 2% of Net Profit

A legal partnership or company may deduct CSR-related expenses under Section 65 Ter (3) 139 of
the Revenue Code at the actual amount paid, but not exceeding 2% of net profit. The deductible
categories include:

(1) Expenses for public charity or public benefit as specified by the Director-General with the

approval of the Minister, deductible up to 2% of net profit; and
(2) Expenses for education or sports as specified by the Director-General with the approval of the
Minister, also deductible up to 2% of net profit.

Examples of charitable expenses eligible for tax deductions include donations to the Thai Red
Cross Society, temples, government hospitals or schools, public libraries, museums, government
art galleries, the Elderly Fund, private rehabilitation centers for children, the elderly, or persons
with disabilities that operate free of charge 140 , funding for public rehabilitation centers, and other
charitable organizations, hospitals, or educational institutions designated by the Minister of

Finance and announced in the Government Gazette.

Examples of public benefit expenses eligible for tax deductions include donations to the Disability
Rehabilitation Fund under the Rehabilitation of Persons with Disabilities Act, the Social Welfare
Promotion Fund under the Social Welfare Promotion Act, the Child Protection Fund under the
Child Protection Act, or the National Sports Development Fund established by the Cabinet
resolution on February 16, 1999 141 .

139 Section 65 Ter of the Revenue Code specifies items that are prohibited from being treated as expenses in the
calculation of net profit. Section 65 Ter (3) prohibits expenses of a personal nature, gratuities, or charitable donations.
However, exceptions are provided: “Expenses for public charity or public benefit, as prescribed by the Director-
General with the approval of the Minister, may be deducted up to 2 percent of net profit; and expenses for education
or sports, as prescribed by the Director-General with the approval of the Minister, may also be deducted up to an
additional 2 percent of net profit.”
140 Notification of the Ministry of Finance on Income Tax and Value Added Tax (No. 2) regarding the Specification of
Organizations, Charitable Institutions, Hospitals, and Educational Institutions under Section 47 (7) (b) of the Revenue
Code, announced on October 12, B.E. 2535 (1992).
141 Royal Decree issued under the Revenue Code on Tax Exemption (No. 428), B.E. 2548 (2005), given on January 8,
2005.
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