Companies frequently incur expenses for sample products given to potential customers, or for promotional and advertising materials (e.g., brochures, banners, branded giveaways).

These expenses are generally considered marketing and sales costs, which are deductible for Corporate Income Tax (CIT) in Thailand, as they are incurred to generate revenue and promote the business.

General Criteria CIT Deductibility

• The samples or promotional materials must be directly related to the company’s business.
• Not for personal benefit of recipients, but for general marketing to advertise, promote sales, or introduce new products/services.
• The expenses must be reasonable and customary for the industry.
• If considered a “gift”: If the value of individual items is high, they might be scrutinized as entertainment expenses or gifts.

Documentation Needed For CIT Deduction

• Purchase invoices for the sample products or promotional materials.
• Records of distribution (e.g., list of events, campaigns, or general distribution methods).
• Marketing plan or budget outlining the purpose of these expenses.
• Proof of payment (e.g., bank transfer slips).
• For high-value items, internal policies for distribution to justify business purpose.

References

• Thai Revenue Code, Section 65 ter (3)
• Thai Revenue Code, Section 65 ter (4)
• Departmental Instructions or Rulings (e.g., Paw. 134/2544 for advertising expenses).