Confused Over The Different Income Types...

[overone]

I'm preparing my personal income tax for the last year, and got stuck on where to place parts of my income.

I got parts of it as a normal salary, i.e.: under section 40(1).

The other part is actually not yet clearly defined yet, as it has been put under “other” in the withholding tax receipts. Hence, I thought I might have the option to put it as income under section 40(3).

I’ve found that Goodwill, other royalties, income in the nature of yearly payments derived from wills, other juristic acts, court decisions, etc, can be put under section 40(3).

1. Does anyone know if any kind of actual revenue from a company can be paid under 40(3)?

2. If so, what do I define it as?

3. And much is the withholding tax of such?

Cheers!

Eric

[LoveDaBlues]

What is the source of the income? With what you've given it probably won't matter where you put it as NORMALLY income is income is income......it all gets lumped together regardless of the source.

I'm guessing you're single.....taxes should be really simple. AND ......depending on your gross income I think you can file the EZ form.

Gross income minus (standard ded. or itemized ded.) minus total exemptions allowed = taxable income. Look in the table .......pay the tax to Uncle Sammy......simple.

[overone]

The thing is that this additional income is defined as "other" on the withholding tax receipts. And not 40(1), which is usually the case with normal salary.

And the reason for asking is that 40(3) is not added together on top of the other incomes, but instead seem to have its own fixed withholding tax rates.

The only example in English I've found is from Thailand Film Office how producers can get their royalty. Search for 40(3) in the middle of the page:

http://www.thailandfilmoffice.org/withholding_tax_eng.php

I agree that the normal case is simple.

But hey! If I can save a couple of thousand bath by just moving one number on the tax form with no objections. I’ll gladly do it.

I just need to know how to prove it…

[Martin_F]

If the income is other payments then it is probably 40(8) and it goes under section 7 ( I've got the 2548 submission not the 2549 one)

For example acting fees are under 40(8) and generally 3-5% is deducted depending on the actually wording on the w/t form.

With this type of income you can claim a 60% deduction from the gross receipts.

But as you have not said what the income is exactly I would not like to confirm that this is the correct treatment.

Please speak to your payroll person at the office and check with that person.

Note you have to complete the ภ.ง.ด.90 and not the shortform ภ.ง.ด.91.

[overone]

Thanks for your help. Much appreciated.

Yes, you are probably right. It fits a lot better under 40(8).

How about 40(7)? It also seems to be smilar to 40(8).

Regarding the withholding tax reciept; it does not have any additional description (as it probably should have).

It's just a sum besides the "อื่น ๆ (ระบุ)" / "other (specify)" paragraph.

The description that is missing, should probably be similar to "consultancy fee" or related.

3% withholding tax have already been deducted.

Payroll department... Yes, I wish!

[Martin_F]

Thanks for your help. Much appreciated.

Yes, you are probably right. It fits a lot better under 40(8).

How about 40(7)? It also seems to be smilar to 40(8).

Regarding the withholding tax reciept; it does not have any additional description (as it probably should have).

It's just a sum besides the "อื่น ๆ (ระบุ)" / "other (specify)" paragraph.

The description that is missing, should probably be similar to "consultancy fee" or related.

3% withholding tax have already been deducted.

Payroll department... Yes, I wish!

OK either speak to your accountant who does the ภ.ง.ด.๑ returns or get a Thai speaker to speak to the Revenue Dept and they should help you. They are generally very helpful and will sort it out withsome bowing and scraping....

[overone]

Duly noted.

However, it’s this accounting person that got the idea of putting it in 40(3), which obviously is wrong.

Last year I got a big back tax because of poor planning and advice from an other accountant. So, my trust in accounting people here is a bit “shaky” to say the least...

In the end of the day it’s my name of the paper, even though an accounting firm does the actual job.

That’s why I appreciate second opinions from people who might have done similar things.

I guess talking to the Revenue Department might be an option.

[overone]

Small follow up after I talked to revenue department:

The item's are, as Martin_F suggested, to be put under 40(8).

And I wrote wrong above. The amount is under item 5 on the withholding tax reciept (services, etc), and not "other" as I previously said.

[Martin_F]

Glad you sorted the problem out.