Companies may opt to rent vehicles for business use instead of purchasing them. Rental expenses for company cars are generally deductible for Corporate Income Tax (CIT) if the vehicles are used exclusively for the company’s business operations. Similar to owned vehicles, robust documentation and clear evidence of business purpose are key to ensure deductibility.

General Criteria CIT Deductibility

• The car must be rented for the purpose of the company’s business.
• The rental agreement must be in the company’s name.
• The rental fees must be reasonable and market-based.
• For passenger cars with seating capacity not exceeding 10 persons, rental expenses are capped for tax deduction purposes.
• Monthly/Yearly Rental: Maximum of THB 36,000 (including VAT) per month per car.
• Daily Rental: Maximum of THB 1,200 (including VAT) per day per car.

Documentation Needed For CIT Deduction

• Rental Agreement/Contract, stating the rental terms, period, and vehicle details.
• Tax Invoices from the rental company.
• Proof of payment: Bank transfer slips or other payment records.
• Logbook (strongly recommended): Detailed records of car usage to prove business purpose.
• Company car policy, outlining rental procedures and usage.