8 Different Income Categories and Payments to be Made for Withholding Tax Filing in Thailand

Is your company paying to a foreign company, doing business in Thailand? Well, that company could be in a form of a branch office, representative or even a go-between, but deriving income in Thailand. If so, then it is subjected to Thai Income Tax while your company will be obliged to the Revenue Code of Thailand for withholding tax filing. Withholding tax rates explained below by different income categories;

1. 5% of the payment for income from services provided like fees, brokerages, meeting fees, and commission fees:
2. 1% of the payment for income from interest
3. 10% of the payment for income from dividends
4. 5% of the payment for income from rent
5. 3% of the payment for income from liberal profession such as, laws, arts of healing, engineering, and architecture
6. 5% of the payment for income from payments to contractors, providing important materials besides tools. If the foreign contractor has a Thai branch office, then 3% of the payment shall be made. A foreign contractor shall be considered as having a permanent branch office in Thailand if he or she;

         a) Owns an office in Thailand

         b) Carries on other business in Thailand other than engaging in contract works, such as; purchase and sale of goods

         c) Has a provident fund for the benefit of his Thai employees.

Usually, the provident fund is set-up by the employees as well as by the employers to promote savings so as to ensure a means of living for a retired or a dismissed from work. As for the rules, the provident fund can be established by either one employer or employee. However, the law needs the fund to be managed by some Fund Management Company. In case of the employees, the amount is deducted from the wages at the rate that mustn’t be lesser than 2% and more than 15%. On the other hand, the employer’s contribution is made at a rate that is not lesser than the employee’s contribution, but not exceeding 15% of the wages.

7. 3% of the payment for the income from royalties
8. 10% of the payment made by the Thai branch to the foreign company for repatriation of profits.

Now that you know about the withholding tax rates you can speak to us for withholding tax submission. Give us a call or send us a mail.