Thailand Live Friday 11 October 2024

[bamboozled]

Hello,

For background info, I have a small business in Thailand that provides services to a clothing line in Italy. I am the sole employee/owner, etc...

I have just gotten home from another frustrating meeting with my Thai accountant. He is not frustrating but the fact that many of the receipts I have collected for expenses are not valid. I am wondering how many other folks have this problem and how do they cope with it.

For a receipt to be valid as deductible it has to be a so-called "bai set" in Thai. What is required on the bai set is the name and address of the company selling the goods, the name and address of my company, plus an official invoice number, a date, and I think that's about it. I often ask for this bai set and am met with confused faces. Shop owners act like they don't know what I'm talking about. They shuffle around, look confused, scratch their head, ask their co-worker/wife/daughter/dog and either throw up their hands or write out a normal receipt that looks like a bai set but is in fact not official. I often spend 10 minutes explaining the bai set and feeling like a fool, like I am asking for such a difficult thing. As my accountant told me yesterday, for the 5th time, every shop owner/business owner in Thailand knows what a bai set is. The point is they don't want to record the transaction and pay tax on it. My problem is I cannot speak much Thai nor can I read it. So I'm not sure what is written on the piece of paper (receipt) that is handed to me. Often they look official but when I give it to my accountant, what I thought was the shop name is just the word Receipt. What I thought was the address just says "Sucker". What I thought was the official invoice number is just the page number in their over-the-counter invoice book. Most of these purchases are for smaller amounts but up to 12,000 baht, which is certainly something one wants to expense. The conclusion is, many of these shops are flat out lying to me. They know full well what I need but they play a game and give me worthless receipts. Actually, I have been refused bai set from a company that I still work with, with billings of 6 or 7 thousand euro at a time but this I have learned to expense in another way, directly to the company overseas. They speak perfect english and were schooled in the US but they tell me they can't give me a bai set.....which means they REFUSE to give me one. My only recourse is to take my business elsewhere, I guess. It makes for tedious and unfriendly business.

My point is, after this long-winded tirade, does anybody have the magic wand for getting a valid bai set/receipt? I was thinking of printing out a card that says I am working with the revenue department in thailand and that the shop will be contacted if doing improper business but this certainly won't make me any friends.

What is an easy way to obtain the proper receipt?

Thanks friends. Peter

[opalhort]

The "bai- set rab-ngoen" has to be issued by everybody selling goods in Thailand.

Yes it can be close to impossible to obtain one from many sellers for obvious reasons.

We face the same problem when purchasing plants at Chatuchak for our business.

Here is what we do:

Have a Thai speaking person with you!

Purchase a receipt book available at any stationary shop (each receipt has two copies, use carbon paper).

Write your name and address in the buyers' field and number the pages Book# / receipt#.

Request the seller to write his/her name and address as required. If refused the Thai person with you can easily get this info and fill it in.

If signature is refused, well there is a way but I can't talk about this here.

If the seller co-operates give him/her a copy of the receipt you prepared.

Invoice number is not required.

This type of receipt can not be used for VAT refunds (in case of export) but is okay for deduction of expenses.

We have been using this method for 20 years without problems, but my Thai wife does all the work!

You do need a trusted Thai person to help you.

opalhort

[monty]

Bit difficult!

What you need is a proper (VAT or non VAT) receipt. In Thai pronounced something like "Bai Set Lap ngeun".

Now the problem is many many smaller traders are not VAT registered. Legally, you only need to register for VAT if your yearly turn over exceeds 1,2 million Baht.

Also, many traders operate as sole proprietors. They do not even need to keep receipts of expenses, the revenue department will just deduct a fixed percentage (usually between 65 and 85%, depending on what the line of business is) on the declared revenue and tax the remainder!

So not getting a VAT receipt in a small shop does not necessarily mean they are not complying with tax laws!

Any bigger trader (Co.,Ltd), should be able to give you the proper invoice as they have to keep full detailed book keeping...

[bamboozled]

Both these answers contain some useful information, thank you. For the multitude of purchases where it is indeed impossible to get a valid receipt, for what ever reason, has anybody come up with a way to recoup those expense deductions? It is frustrating that I am trying to comply with the law but am being thwarted by others who don't want to comply for their own selfish reasons. I understand their reasoning, if indeed they don't want to pay tax on the purchase, but they are shifting the burden to me. What can we do? In the US, it is far simpler to compile your receipts and declare them as deductions. In Italy, on the other hand, it is much like in Thailand and obtaining a valid receipt is often a hassle, especially for small purchases, which incidentally over the course of a year add up to quite a sum.... Peter.

[VocalNeal]

Both these answers contain some useful information, thank you. For the multitude of purchases where it is indeed impossible to get a valid receipt, for what ever reason, has anybody come up with a way to recoup those expense deductions? It is frustrating that I am trying to comply with the law but am being thwarted by others who don't want to comply for their own selfish reasons. I understand their reasoning, if indeed they don't want to pay tax on the purchase, but they are shifting the burden to me. What can we do? In the US, it is far simpler to compile your receipts and declare them as deductions. In Italy, on the other hand, it is much like in Thailand and obtaining a valid receipt is often a hassle, especially for small purchases, which incidentally over the course of a year add up to quite a sum.... Peter.

Peter,

Do you have a business card with your company's name and address in Thai? If you give them this then most places will comply. May cost you 7% more though.

Not for small purchases though. I usually ask for a business card when making small purchases. I staple this to the "receipt". Not sure if works but neither my book keeper nor auditor have said anything. Now I'll have to check

[bamboozled]

Good idea about the business card in Thai. The only one I have is in English. It would be easy enough to make one up on the computer and print a few for these situations. As for your method of stapling the card to the receipt, I don't believe it is valid in Thailand. My accountant for one says it is not.

Peter,

Do you have a business card with your company's name and address in Thai? If you give them this then most places will comply. May cost you 7% more though.

Not for small purchases though. I usually ask for a business card when making small purchases. I staple this to the "receipt". Not sure if works but neither my book keeper nor auditor have said anything. Now I'll have to check

[Carmine6]

Also do you inquire ahead of, or after the purchase? If your purchase is basically conditional upon getting a proper receipt it could help.

[bamboozled]

...now that's a really good idea.... Of course, they will say yes yes yes no problem and then after payment they'll hand me the usual invalid scrap of paper. But it's worth a try.

Thank you.