According to Prakas 574 “On the Rules and Procedures for Income and Expense Allocation among Related Parties” dated 19 September 2024.
The definition of a “related party” has been broadened to include any entity that directly or indirectly controls, is controlled by, or is under common control with the
taxpayer. It also includes the relationship between a permanent establishment and its non-resident parent entity.

“Control” is defined as holding 20% or more of either the direct equity interest or the voting rights in the company’s board of directors.
However, the tax authority reserves the right to assess whether control exists—directly or indirectly—based on the specific circumstances of each case.

Read PDF File “Eng”