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Thai Personal Income Tax
Filing Requirements

Thai personal income tax filing for your employees with our expert guidance and filing services.

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In Thailand, the Personal Income Tax is a significant component of the country’s revenue system. It is essential for individuals to understand the tax regulations, tax filing deadlines, and payment procedures to ensure compliance with the law.

 

Who Must Pay Personal Income Tax in Thailand?

Thai personal tax residency is determined by the period in which the individual is present in Thailand.  A person becomes a Thai tax resident once they are present in Thailand for at least 180 days cumulatively within a calendar year.  Resident individuals are subject to Personal income tax on Thai sourced income and income earned overseas if remitted into Thailand.

Non-resident individuals are subject to Thai personal income tax  on any income they have earned during the year from sources inside Thailand. 

 

Tax Year and Filing Deadline:

The tax year in Thailand aligns with the calendar year, ending on December 31. Individuals are required to complete their Personal Income Tax filings to the Thai Revenue Department (TRD) and make necessary payments by March 31 of the following year. The tax filing forms most commonly used are PND 90 or PND 91.

 

Personal Withholding Tax System:

Thai Personal Income Tax is primarily deducted at the source, directly through the hiring company’s monthly withholding tax submissions via either of the following two forms:

  • employer’s monthly payroll withholding tax filing form PND 1, using progressive personal tax rates; or,
  • in the case of individual subcontractors hired to perform a specific scope of hire-of-work providing their own equipment/investment, then form PND 3 is used, withholding 3% of the subcontractors’ service fees.
 

Employers calculate and withhold payroll tax based on the applicable tax tables provided by the TRD. These tables are designed with progressive tax rates that vary depending on their employees’ estimated base annual salary. The tax rates start from 0% for lowest-income bracket (on the first THB 0 to THB 150,000 in annual taxable income) up to a maximum of 35% for highest-income bracket (based on estimated annual employment taxable income of THB 5,000,001 and over).

 

Monthly Payments to the TRD:

The employer’s monthly payroll withholding tax deductions must be paid over to the TRD at the end of every month. Employers play a crucial role in facilitating this process by collecting and remitting these withheld amounts on behalf of their employees. This regular monthly payment system ensures and simplifies the overall tax collection process.

Communication between the company’s payroll team and employees can be beneficial to both parties.  The company is required to take responsibility of deducting the correct withholding tax and remitting at minimum their employees’ base salary and benefits. For any shortfall in withholding tax, the TRD will hold the company responsibility to pay for their non-compliance, plus any penalties and surcharge. 

 Conversely, employees need to ensure their employer is aware of all of their personal allowances and other planned allowable deductions to minimize their employer’s ongoing monthly payroll withholding tax to avoid being needlessly over-taxed &/or the risk of becoming subject to a TRD personal tax audit due to the creation an avoidable tax refund situation or in case of any non-compliance.

AO understands that the nuances of the Thai Personal Income Tax system is vital for both employers and employees. Adhering to the prescribed timelines for filing and payment, leveraging allowable deductions, and ensuring accurate calculations are essential steps in maintaining compliance. Regular updates and awareness of any changes in tax laws can further help individuals navigate the system efficiently.

 

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Khun Suwaree has a degree in Business Administration, majoring in accounting and an MBA. She is a seasoned accountant with more than 30 years of professional experience. She has been a Finance & Accounting Manager in various large businesses (production, trading, and services). She is experienced in several accounting programs (MYOB, Xero, QuickBooks, SAP, Navision Accounting, Formula Accounting, MS Dynamics 365, etc.) as well as B-Plus payroll software.

Her commercial mind, with an excellent grasp of Thai Tax, plays a big role in helping both local and International clients across various industries.

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