Revenue Department Letter to Your Company: How to Prepare and Respond to a Tax Audit

The core answer

When a Thai company receives a letter from the Revenue Department, the first job is to read what kind of letter it is. An invitation letter (หนังสือเชิญพบ) asks you to come and bring documents. A summons (หมายเรียก) is a formal order under the Revenue Code. The two are treated differently if you do not respond, but you should answer both, in writing, before the date.

The rule (Revenue Code). For corporate income tax, an assessing officer who has reason to believe a return is incorrect or incomplete may summon the filer and order books and documents to be produced (section 19), with at least 7 days' notice and generally within 2 years of the filing date. For VAT the equivalent is section 88/4, also with at least 7 days. If you ignore a summons without reasonable cause, the officer may assess the tax as he or she sees fit and that assessment cannot be appealed (sections 21 and 88/5). An ordinary assessment can be appealed within 30 days of receiving the notice (section 30).

Our practical view. Most audits are resolved at the meeting table, not in court. The best outcome usually comes from three things done early: identify exactly which tax, period and transactions the letter covers; send a person who can explain the figures; and bring complete, organised documents. Do not wait until the last day, and do not let the 30-day appeal clock pass while "negotiating".

This guide covers the response process. For ordinary accounting set-up see accounting in the first year; for fixing missed filings see changing accountants and missing filings.

1. What kind of letter did we receive?

If the letter is vague, phone the officer named on it and ask, then confirm in writing: which tax type, which period, and which documents. Keep the envelope or proof of the date of service. The notice period runs from service.

Caution on terms: the Supreme Court decisions above concern their own facts (letters of a certain kind). Whether your particular letter is a summons depends on its content. If it says it is issued under section 19 or section 88/4, treat it as a summons.

2. What deadlines matter?

• Summons: at least 7 days from service (sections 19, 23 and 88/4). Ask for a new date in writing before the first date if you need time.
• Time limit on the officer. For income tax, a section 19 summons is generally issued within 2 years of the filing date, extendable up to 5 years with the Director-General's approval where there is evidence or suspicion of tax evasion, or in refund cases. For VAT, the assessment time limits are in section 88/6: generally 2 years, up to 5 years with approval where the return looks incorrect, and 10 years where no return was filed or the tax base was understated by more than 25%. A letter arriving close to or after these limits is a point to check with an adviser, not to assume.
• Appeal: 30 days from receiving the notice of assessment (section 30). A late appeal needs a petition to the Director-General to extend time under section 3 attha, with reasons; extension is not automatic (Revenue Department regulation on appeals, B.E. 2564).
• Payment does not wait. An appeal does not suspend payment (section 31) unless the Director-General approves deferral. Surcharge on unpaid tax is 1.5% per month or part of a month, capped at the amount of the tax (sections 27 and 89/1).

3. Who should attend, and with what authority?

The Revenue officer will want someone who can answer questions about the books. Typically:

• the accountant or finance manager who prepared or checked the figures; and
• a director or a person with a written power of attorney (หนังสือมอบอำนาจ) from the company.

Check that the person who attends is authorised to speak for the company and to receive notices. The Revenue Department publishes a standard power of attorney form for representing a taxpayer at inquiries; ask the officer which form the office wants, and attach copies of the company certificate and the signing director's ID as the office requires. We have not verified every office's document requirements, so confirm them when you phone.

If the issue is complex (transfer pricing, loans from directors, overseas payments), have a lawyer or tax adviser attend with the accountant. See overseas service payments, VAT and withholding tax and export of services and zero-rated VAT for two common audit topics.

4. What documents should we prepare?

Ask first for the officer's list, then prepare a clean pack. A practical pack:

Tips:

1. Reconcile before you go. Know why revenue in the return differs from revenue in the bank, and why VAT differs from the ledger.
2. Number and index the pack. Hand over copies, keep originals and a list of what was handed over.
3. Answer only the periods and taxes in the letter, but do not refuse additional documents the officer lawfully asks for.
4. Never alter or back-date documents. Intentionally giving false evidence to evade tax or seek a refund is an offence under section 37 (imprisonment of 3 months to 7 years and a fine of 2,000 to 200,000 baht).

5. What should we say, and not say?

• Do explain each transaction factually: who, what, when, why, how paid. Use documents to support each point.
• Do say "I will check and confirm in writing" if you are not sure. A prompt written reply is better than a guess.
• Do ask for the officer's findings in writing and keep your own meeting note.
• Do not guess, estimate or "round" figures in the meeting.
• Do not offer to pay an amount to "close the matter" before you understand the basis of the finding.
• Do not sign a statement you have not read, or agree to a figure you cannot reproduce.

Hypothetical example: an officer questions a service fee paid to an overseas group company. The accountant says the service was "probably for IT support". The better answer is: "We will provide the service agreement, invoices, evidence of work performed and the withholding tax filing by Friday." The second answer is documented, bounded and in writing.

6. What happens after the meeting?

The officer may close the file with no change, ask for more documents, or issue a notice of assessment with additional tax, penalty and surcharge. If you disagree with an assessment:

1. Diarise 30 days from the date you received the notice (section 30).
2. File the appeal on the Director-General's form, through the e-appeal system or in person. The regulation says that if the electronic system fails, you must file in person before the deadline.
3. Consider a deferral request. Appeal does not stop payment (section 31); the Director-General may approve waiting for the decision. Ask early.
4. Prepare for a section 32 summons. The appeal committee can summon you and order documents, on at least 15 days' notice. Failing to comply without reasonable cause costs you the right to appeal further (section 33).
5. Court. If the committee decision goes against you, you have 30 days from receiving it to take the case to court (section 30), unless an appeal bar applies.

Penalties: for income tax, section 22 sets the penalty at one times the additional tax for assessments under sections 20 and 21. For VAT, section 89 lists penalties per type of error (for example, one times for an incorrect return, twice for late filing or failure to issue a tax invoice). Penalties and surcharge may be reduced or waived under Revenue Department rules; we have not set out those rules here, so ask the officer or your adviser which relief applies to your case.

7. Should we hire a lawyer or adviser, and when?

Consider it when the amount is material, the letter covers several years, there are related-party or overseas payments, an assessment has been issued, or you suspect a document is missing or wrong. Earlier is cheaper than later: advice before the meeting can shape what you present, while advice after an assessment is limited to the appeal. See also choosing corporate legal counsel and foreign-owned company tax obligations.

Checklist when the letter arrives

1. Record the date and manner of service; scan the letter and envelope.
2. Identify the type: invitation, summons (which section), assessment, refund inquiry.
3. Note every date: meeting date, document deadline, 30-day appeal date.
4. Phone the officer; confirm tax type, period and documents; confirm in writing.
5. Brief the accountant and director; decide who attends and issue a power of attorney if needed.
6. Pull, reconcile and index the document pack.
7. Request a new date in writing before the old one passes if you need time.
8. Keep a meeting note and copies of everything handed over.
9. If an assessment arrives, calendar the appeal and decide on deferral request and adviser.

Further reading

• Accounting in the first year of a Thai company
• Changing accountants and missing filings
• Accounting and tax obligations of a foreign-owned Thai company
• Overseas service payments, VAT and withholding tax
• Customs post-clearance audit

Treat every Revenue Department letter as time-limited: identify whether it is an invitation or a summons, answer in writing before the date, and diarise the 30-day appeal period the day an assessment arrives.

We advise Thai companies on responding to Revenue Department inquiries, preparing for meetings and appealing assessments. Initial consultation is free — call +66 92 254 2045 or send us the details. See also accounting and tax compliance, legal retainer and tax law services.

This guide is published by Suwanvara Law Firm — a Khon Kaen law firm established in 1986. General information only, not legal advice on a specific matter.