Q : Is the money derived from the dissolution of a limited partnership that the partner received deemed as a dividend or share of profits and is the partner entitled to claim it as a tax credit?
A : No, such money is not deemed as a dividend or share of profits that can be claimed as a tax credit in accordance with Section 40 (4) (b) of the Thai Revenue Code (“TRC”), in conjunction with Section 47 Bis of the TRC. Instead, only the portion that exceeds the capital deemed as a benefit that the partner received in accordance with Section 40 (4) (f) of the TRC.
Supreme Court Judgment No. 13935/2555 The TRC does not prescribe a specific definition of dividend and share of profits, hence its definition shall be determined based on Section 1084 of the Civil and Commercial Code. Since the money that the Plaintiff received upon the dissolution registration of the limited partnership is the profit incurred during the liquidation; therefore, it is not a dividend, which is an assessable income under Section 40 (4) (f) of the TRC. Instead, only the portion that exceeds the capital value that the partner invested is considered a benefit that the partner received from the dissolution of a limited partnership that is an assessable income in accordance with Section 40 (4) (f) of the TRC. Accordingly, the Plaintiff is not entitled to receive a tax credit in accordance with Section 47 Bis of the TRC.
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