Most of what people call year end work can be done in February. The accounts get closed, the auditor arrives, the filings go out, and nothing is lost by starting late except your own evenings.
A smaller number of things behave differently. They are tied to the year itself, and on 1 January they stop being decisions and become facts. This piece is about those. None of them is a big project, and none of them needs a consultant. They need attention in November, which is the cheapest moment you will get.
The five, in short:
- Plan cash to the end of January, not to 31 December.
- Compare the half-year tax estimate you filed in August with the year you are actually having.
- Book the stock and fixed asset counts for 31 December.
- Use the deductions that expire: late input VAT, bad debts, and loans on proper terms.
- Decide whether your auditor fits what you plan to do with the company.
1. The December hole is really a January hole
Thailand slows down well before New Year. Saturday 5 December and Thursday 10 December are public holidays, and from around Friday 25 December most offices run on skeleton staff until the week of Monday 4 January. Your customers' approvers take leave in the same window, so an invoice issued after about Tuesday 15 December is unlikely to be paid before the new year.
The outflows do not take the same break. Bonuses and the thirteenth month usually go out in mid December. December payroll goes out at month end. Then the withholding returns and the VAT return for December fall due in the first half of January, including the withholding and reverse-charge VAT on any December payments to your head office or foreign suppliers (Plizz explain those in their guide to paying foreign suppliers). All of that lands before January's receipts have had time to arrive.
So the squeeze does not sit in December, where most people look for it. It sits in the first three weeks of January, when the December obligations have to be paid out of a bank balance that stopped being topped up on the 15th.
Three things help, and all three are free:
- Issue December invoices in the first week of the month rather than the last, and chase the approvals before the 15th.
- Agree the bonus and thirteenth month timing with whoever runs payroll now, rather than finding out the date in December.
- Build the cash view to the end of January, not to 31 December. Forecasting to year end hides precisely the fortnight that hurts.
2. The estimate you filed in August
The half-year corporate income tax return (PND 51) was filed by the end of August on a forecast of the full year's profit. If that forecast turns out to be more than 25% below the actual net profit for the year, and there is no justifiable reason, a surcharge of 20% applies to the tax that was underpaid at half year. The main safe harbour is an estimate that was at least half of the previous year's actual net profit.
The surcharge itself is rarely large. What matters is that November is the last point at which it is a decision rather than a bill. Take the actuals for January to October, add a realistic November and December, and compare the result with the estimate that was filed. If the gap is uncomfortable, you still have time to understand why, to prepare the explanation, and to make sure the board is not hearing about it for the first time in May.
3. Count it on 31 December, or you never counted it
Stock and fixed assets have to be counted at the year end date, or close enough to it that movements in between can be reconciled. February cannot reconstruct 31 December. An auditor who arrives in March to find that nobody counted has a problem that no amount of goodwill will solve, and the usual outcome is a qualification or a long and expensive set of alternative procedures.
What to settle in November:
- The date and time of the count, and who does it. The people who count should not be the people who keep the stock records.
- How you treat goods in transit, consignment stock, and anything sitting at a customer's or supplier's site.
- For fixed assets, whether the register still matches what is physically there. Assets that were scrapped, sold or moved without paperwork are the commonest finding.
- Whether your auditor wants to attend. Many will, and they book those dates early.
It is an afternoon of planning in November and a very bad week in March.
4. The deductions that expire with the year
Three things that get more expensive, or impossible, once the year closes.
Unclaimed input VAT. An input tax invoice that was not claimed in its own month can still be claimed late, but only within six months counted from the month after the invoice month. In practice, an invoice dated May can be claimed no later than the November return, and a June invoice no later than December. So invoices from the middle of the year are expiring now, one month at a time, not at year end. If there is a drawer, a shared folder or an inbox of tax invoices that never made it into the VAT return, this is the month to go through it.
Bad debts. Writing off a bad debt for tax purposes in Thailand is procedural, and the procedure depends on the size of the debt (Ministerial Regulation No. 186, as amended in 2021). Up to THB 200,000 per debtor, documented collection attempts are enough if suing would cost more than you could recover. Between THB 200,000 and THB 2 million, a lawsuit has to have been filed and accepted by the court, and the write-off approved by a director within 30 days of the year end. Above THB 2 million, you need a court judgment and enforcement, or a bankruptcy process. The deduction falls in the year the steps are completed, so a mid-size receivable that everybody privately knows is dead needs a lawyer in November, not an awkward conversation with the auditor in March.
Interest-free loans. Loans between companies at no interest, or below market, can be reassessed by the Revenue Department at a market rate of interest under Section 65 bis (4) of the Revenue Code. Lending regularly to directors without interest has also been treated as a lending business subject to specific business tax. Loans to or from shareholders, directors or group companies with no interest and no agreement are considerably easier to document, or to put on proper terms, before the year closes than to explain afterwards.
5. The audit you are buying, and the one you actually need
This one depends on what you intend to do with the company.
If the company carries on as it is, a compliance audit is the right product. Every Thai company needs one, dormant ones included, and plenty of small subsidiaries need nothing more than a clean signed set of statements on time. The only question worth asking is whether you are paying advisory prices for a compliance service, and that is worth ten minutes and two phone calls to find out.
If you intend to raise money, sell the business or list it, even on a three to five year horizon, the answer changes. Investors, buyers and exchanges look at audited history, and that history attaches to the year, not to the date you change your mind. Change auditor next November and FY2026 stays signed by the outgoing firm, so the new firm's first full year is FY2027 and your three-year run finishes a year later than it needed to. Going back to re-audit closed years is expensive, and it always looks like what it is.
If a listing is anywhere on the horizon, check one more thing. The Stock Exchange of Thailand requires the auditor of a listing applicant to be approved by the SEC, and the filing generally includes three years of audited statements. If your current firm is not on the SEC's approved list, every year you stay is one more of those three years signed by a firm that is not on it.
Whichever applies, two practical points.
An interim audit in November or December moves part of the work earlier, and that changes what a finding means. A finding now is a correction inside the year. The same finding in March is an adjustment to a year you have already closed, and sometimes a restatement. Auditors also have far more room in their diaries now than between February and April, so you tend to get more experienced people and more of their time.
Changing auditor is not a phone call. The auditor is appointed by the shareholders, so it takes a resolution. The incoming firm will want comfort on the opening balances and will usually want contact with the outgoing firm. Before fieldwork starts, that is realistic. In March it is not.
One more, if it applies
If there is a company in your structure you no longer need, a dissolution registered before 31 December can spare it another full year of accounts and audit. An instruction given by mid November leaves enough time; one given in the second half of December is tight. Narai Partners set out the steps, deadlines and costs in their guide to closing a company in Thailand.
What can wait until January
For balance, the things that genuinely can wait:
- Closing December itself and preparing the year end accounts.
- The audit fieldwork, provided the auditor is appointed and the counts were done.
- The annual corporate income tax return (PND 50), due within 150 days of year end, so the end of May, with eight extra days if you file online.
- The AGM to approve the audited accounts, within four months of year end, so by the end of April, then the filing with the Department of Business Development within one month of the meeting. The full calendar is on the Thailand page.
All of those have proper deadlines, and none of them is helped by starting in November.
The short version
Four of the five above cost nothing but attention this month. The fifth costs a conversation you may have been avoiding. All five become considerably more expensive on 1 January, which is the only reason to deal with them now rather than in February.
This is general information for companies in Thailand with a 31 December year end, current at the date of publication. It is not tax or legal advice, and the detail of any rule should be checked against your own facts before acting on it.
Jerome Le Louer is Managing Partner of SmeCFO Asia, a fractional and interim CFO practice serving international companies across Thailand, Singapore, Hong Kong, Vietnam, Indonesia and the Philippines. He can be reached at [email protected].