ROH Tax Incentive,

Regional Office Headquarters (ROHs) in Thailand
Bangkok and Phuket

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REGIONAL OPERATING HEADQUARTERS (ROH)

1.  ROH CONCEPT

       1.1   Regional Operating Headquarters (ROHs) refers to as a locally incorporated company which carries on business in Thailand and provides qualifying services to its associated enterprises or branches.

       1.2  The qualifying services provided by the ROH are as follows:

                 (a)   management and administrative services;

                 (b)   technical services;

                 (c)   other supporting services in respect of;

                          *  general administration, business planning and coordination,

                          *  procurement of raw materials and components,

                          *  research and development,

                          *  technical support,

                          *  marketing control and sales promotion planning,

                          *  training and personnel management,

                          *  corporate financial advisory services,

                          *  economic or investment research and analysis,

                          *  credit control and administration,

                          *  any other activities prescribed by the Director General.

       1.3  Associated enterprises means two or more companies related to one another in any of the following manners:

                 (a)  Shareholding basis 
i) ROH holds at least 25 percent of that company's issued capital; or
ii) The company holds at least 25 percent of ROH's issued capital; or
iii) The company holds at least 25 percent of ROH and other company's issued capital. In this case, ROH and the other company are regarded as associated enterprises.

                 (b)  Control basis 
i) ROH has control over that company; or
ii) The company has control over ROH; or
iii) The company has control over ROH and the other company. In this case, ROH and the other company are regarded as associated enterprises.

      
2.  QUALIFYING CRITERIA
In order for an ROH to be eligible for the tax benefits, it must fulfil the following conditions:

       2.1  an ROH must be a juristic company or partnership incorporated under the law of Thailand;

       2.2  the paid up capital of the company on the last day of accounting period should be a minimum of 10 million Baht;

       2.3  the company should serve associated enterprises or branches situated in at least 3 other countries excluding Thailand;

       2.4  income received from rendering services to its associated enterprises or branches outside Thailand must not be less that 50% of total income (except during the first 3 years, 1/3 of total income is allowed as the minimum income received from its associated enterprises or branches outside Thailand);

       2.5  the company must submit the notification to the Revenue Department; and

       2.6  other criteria as prescribed by the Revenue Department.

3. AMENDMENTS ON REGULATIONS AND PRIVILEGES OF REGIONAL OPERATING HEADQUARTERS (ROHs) BUSINESSES

3.1 Amendment of Conditions

3.2 Amendment of Privileges

Remark : The revised regulations are effective from November 15,2010.

4. REQUIREMENT FOR BOI PROMOTION

(a)  Foreign Company  
A foreign company, if not yet promoted as an ROH business by the BOI, can submit an application for promotion to the BOI. Notification of ROH establishment to the Revenue Department should be submitted after the ROH is promoted by the BOI. An ROH which is a foreign company is also required to obtain a foreign business certificate from the Ministry of Commerce.

The ROH, which has been granted BOI promotion, has to examine the approved scope of ROHs services.  If the scope of services does not include the current or future ROH business activities, an application for BOI project amendment should be submitted to the BOI.

In the case of a non-BOI company, a foreign business license from the Ministry of Commerce must be obtained.

(b)  Thai Company  
An application for BOI promotion is not required