Accounting friction in dealings with Thai companies — the top 5 problems

Why "differences between counterparties" stall your accounting

Run a business in Thailand and you'll repeatedly find your accounting failing to flow smoothly through the daily back-and-forth with Thai suppliers, subcontractors, and customers. More often than not, the root cause is that the counterparty's accounting process differs from your own.

In Thai B2B, the types of documents, the treatment of withholding tax, and the billing-and-payment cycle vary considerably from company to company. The Japanese assumption that "closing dates and payment dates are roughly standard across an industry" simply doesn't hold here. Unless you adapt to each counterparty's practices, you run into problems almost every month: you can't collect withholding tax certificates, you can't deduct input VAT, or your receipts don't reconcile.

Below we lay out the top 5 problems we've seen again and again in the field, along with how to avoid them.

Problem 1: Withholding tax (WHT) deductions and certificate hand-offs don't line up

In Thailand, the paying party deducts withholding tax (WHT: ภาษีหัก ณ ที่จ่าย) and remits it. Rates differ by transaction type; the most common are:

• Services / contracting: 3%
• Rent: 5%
• Advertising: 2%
• Transport: 1%

After deducting, the paying party is obliged to issue the counterparty a withholding tax certificate (หนังสือรับรองการหักภาษี ณ ที่จ่าย, commonly called 50 ทวิ).

Three issues come up constantly:

• The counterparty fails to issue the certificate on time — or never issues it at all → you can't assemble your tax credits or supporting documents
• You and the counterparty disagree on whether WHT even applies, and at what rate
• The supplier assumes it will receive the gross (face) amount, while you pay net of deduction → disputes over the payment amount

How to avoid it: At the start of the relationship, spell out "the WHT rate and whether deduction applies" right in the quotation or the PO (purchase order). At payment time, build the certificate hand-off into your payment flow and track it with a collection checklist.

Problem 2: Tax invoice (ใบกำกับภาษี) timing and content requirements

To deduct input VAT (7%), you need the original of a tax invoice (ใบกำกับภาษี) that meets the requirements. The full format must show both parties' 13-digit taxpayer IDs, the head office / branch distinction (สำนักงานใหญ่ / สาขา plus the branch code), addresses, a running serial number, the date, and so on.

Issuance timing also differs by counterparty. As a rule, goods are invoiced on delivery and services on receipt of payment, so depending on the counterparty's practice, the month in which VAT is recognized may differ from yours.

Common problems:

• Defects in the details (wrong taxpayer ID, branch code, or address) mean you can't deduct input VAT
• You're handed a copy (สำเนา) instead of the original (ต้นฉบับ), which doesn't qualify as deduction support
• The counterparty's issuance month and your recognition month diverge, producing discrepancies in the VAT return

How to avoid it: Check the required details on the spot when you receive the invoice (especially the branch code and taxpayer ID). Keep the originals securely and reconcile them against the VAT ledger monthly.

Problem 3: Billing cycles (วางบิล / รับเช็ค) differ from company to company

In Thai B2B, it's still widespread practice to perform วางบิล (waang bin = submitting the billing note) and รับเช็ค / จ่ายเช็ค (receiving / paying by cheque) on set days of the week or fixed dates. Each company runs its own calendar — for example, "billing notes submitted on the 25th of each month, cheques collected on the 10th of the following month."

When your own assumed "closing and payment" schedule doesn't mesh with the counterparty's วางบิล schedule, you get:

• A missed billing-note submission date that pushes your receipt back a full month
• Payment dates scattered across counterparties that make cash flow impossible to forecast
• Frequent re-submissions and rework of documents

How to avoid it: For each major counterparty, confirm their วางบิล date and payment date and compile them into a list, then fold that into your own AR/AP schedule. Don't leave it in your staff's heads — share it as a rule.

Problem 4: Document types and the treatment of "originals" aren't standardized

In Thai B2B, several documents travel back and forth along the flow of a transaction:

• ใบเสนอราคา (quotation)
• ใบสั่งซื้อ / PO (purchase order)
• ใบส่งของ / ใบกำกับภาษี (delivery note / tax invoice — often a combined form serving as both)
• ใบวางบิล (billing note / billing advice)
• ใบเสร็จรับเงิน (receipt)

The problem is that which document is the formal basis for accounting and tax, and whether it's an original or a copy, isn't consistent from one counterparty to the next.

• Some companies issue the delivery note and tax invoice separately, others combine them — and you'll deal with both
• The original tax invoice you need for input VAT deduction doesn't reach you
• The receipt (ใบเสร็จรับเงิน) is only issued after payment is received, leaving your monthly supporting documents incomplete

How to avoid it: Standardize "the set of documents we must receive from a counterparty" on your side, and set rules for managing originals. Turn the receive → store → reconcile flow into a checklist.

Problem 5: Payment methods and receipt reconciliation (cheque / PromptPay / transfer) don't match

Payments in Thailand still rely heavily on cheques (เช็ค), alongside bank transfers and PromptPay. On top of that, because WHT is deducted as described above, the invoiced amount and the amount actually received don't match (face amount − withholding tax = receipt).

As a result:

• During receipt reconciliation, the invoiced amount and the received amount don't agree, and tracing the cause eats up time
• Cheque collection and value dates shift your recognition timing
• The pay-in slip and withholding tax certificate aren't sent together, so you can't identify what a given receipt is for

How to avoid it: Make it a rule to exchange the remittance record plus the withholding tax certificate as a set with every payment and receipt. Insist on reconciling on the basis of the net amount after withholding, and link invoices to receipts in cloud accounting (such as PEAK) — that alone makes reconciliation dramatically easier.

In closing — set your own standard, then operate to fit each counterparty

In Thai B2B, you can't change the counterparty's accounting process. That's exactly why you should:

1. Set your own standard rules first (which documents you accept, WHT, VAT, the billing/payment cycle)
2. Map out the differences between counterparties (วางบิล dates, document formats, payment methods) in a single list
3. Run a monthly reconciliation (withholding tax certificates, tax invoices, receipts) off a checklist

Build these three into a system and you'll cut the monthly stumbles dramatically. The key is to stop relying on individuals "noticing" things and instead capture it all in rules and checklists.

What MIRAI BizLab delivers

We provide hands-on support for organizing the accounting around B2B transactions for businesses operating in Thailand.

• Organizing the WHT, tax invoice, and วางบิล rules for each counterparty and designing the operations around them
• Standardizing received documents and managing originals, plus building a monthly reconciliation flow
• Operational training for both local staff and the Japanese head office
• Making the invoice-to-receipt cycle visible by adopting cloud accounting

Recurring headaches like "the withholding tax certificates never come together" or "receipts never match the invoices" can be solved with the right system. For more, see Accounting System Implementation.

Start with a free consultation

Tell us about your current accounting process, and we'll point to the specific causes of the friction and a concrete path to fixing it. Feel free to reach out via our Contact page.

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