Thai gov. to tax (remitted) income from abroad for tax residents starting 2024 - Part II

[chiang mai]

52 minutes ago, Yumthai said:

I'm not saying you can't hire as a sole business owner, just that WHT filings should be required as well.

You see the problem, as long as TRD allows all self employed to group all their expenses in the standard deduction, there is no requirement to disclose wages paid to others.

[Yumthai]

1 hour ago, chiang mai said:

You see the problem, as long as TRD allows all self employed to group all their expenses in the standard deduction, there is no requirement to disclose wages paid to others.

I don't get it. You mean there is no requirement to disclose wages paid to other employees?

 

https://www.thailand.go.th/issue-focus-detail/006_115

 

"SME entrepreneurs, whether operating as individuals, such as a sole proprietor, ordinary partnership, or a group of persons that is not a legal entity, or as legal entities, such as a limited company, limited partnership, or legal entity partnership, when paying income types that the law specifies should have taxes withheld at source, must follow these procedures:

1. Have and use a taxpayer identification number (except for individuals who do not have to pay Value Added Tax, who should use their citizen identification number instead).
2. Deduct tax at source every time income is paid, which the law requires to be deducted at source, at the rate specified by the law.
3. Issue a certificate of withholding tax at source to the tax deductee as evidence for filing the income tax return. If it involves the government, an organization of the government, a municipality, a sanitary district, or another local administration organization, the paying officer should issue a receipt for the tax that has been deducted to the income recipient.
4. Remit the withheld tax within seven days from the end of the month in which the income was paid, to the local branch of the Revenue Department where the person obliged to withhold income tax at source has their office."

 

 

Found this other 2023 doc below quite comprehensive although not up-to-date regarding last overseas income remittance changes:

https://www.grantthornton.co.th/globalassets/1.-member-firms/thailand/media/doing-business-in-thailand-2023-_may.pdf

 

Edited 1 hour ago by Yumthai

[chiang mai]

20 minutes ago, Yumthai said:

I don't get it. You mean there is no requirement to disclose wages paid to other employees?

 

https://www.thailand.go.th/issue-focus-detail/006_115

 

"SME entrepreneurs, whether operating as individuals, such as a sole proprietor, ordinary partnership, or a group of persons that is not a legal entity, or as legal entities, such as a limited company, limited partnership, or legal entity partnership, when paying income types that the law specifies should have taxes withheld at source, must follow these procedures:

1. Have and use a taxpayer identification number (except for individuals who do not have to pay Value Added Tax, who should use their citizen identification number instead).
2. Deduct tax at source every time income is paid, which the law requires to be deducted at source, at the rate specified by the law.
3. Issue a certificate of withholding tax at source to the tax deductee as evidence for filing the income tax return. If it involves the government, an organization of the government, a municipality, a sanitary district, or another local administration organization, the paying officer should issue a receipt for the tax that has been deducted to the income recipient.
4. Remit the withheld tax within seven days from the end of the month in which the income was paid, to the local branch of the Revenue Department where the person obliged to withhold income tax at source has their office."

 

 

 

 

 

 

That raises more questions than it answers!

 

1) A sole proprietor and a self employed person are not the same things.

 

"A self-employed individual simply means the person works for him or herself. It's just a business term. A sole proprietor refers to someone who owns a business by themselves".

 

https://www.hellobonsai.com/blog/sole-proprietorship-vs-self-employed#:~:text=Since a sole proprietor operates,owns a business by themselves.

 

2) "when paying income types that the law specifies should have taxes withheld at source, must follow these procedures".

 

If the individuals TEDA are more than the wages?  And what are those income types?

 

3) If the entity must withhold tax and forward them to the TRD, how do they do that as a self employed person (which is not a legal entity) and therefore ineligible to obtain a TRD  employers account?

 

EDIT TO ADD: An excellent find however!

 

 

 

 

 

 

 

 

Edited 1 hour ago by chiang mai

[chiang mai]

"I don't get it. You mean there is no requirement to disclose wages paid to other employees?"

 

If a self employed person uses another self employed person for a specific job, they are not an employee. Even if the self employed person who does the hiring, contracts with another self employed person, that is a contractual relationship and not an employment contract of employer and employee. The cost of that....let's call it sub-contracting,....are all hidden within the 60% standard deduction  and there is no requirement to declare them or with hold tax.

 

 

[Yumthai]

8 minutes ago, chiang mai said:

If a self employed person uses another self employed person for a specific job, they are not an employee. Even if the self employed person who does the hiring, contracts with another self employed person, that is a contractual relationship and not an employment contract of employer and employee. The cost of that....let's call it sub-contracting,....are all hidden within the 60% standard deduction  and there is no requirement to declare them or with hold tax.

Can an unregistered self-employed legally hire an employee or a contractor, and thus not file any WHT return?

[chiang mai]

2 minutes ago, Yumthai said:

Can an unregistered self-employed legally hire an employee or a contractor, and thus not file any WHT return?

Good question....dunno!

 

In theory there's no hiring involved, it's more of a prime contract/sub contractor relationship perhaps but definitely not an employee.

 

My wife is self employed and she hires workers and pays them by the hour, all paid daily....that expense is never seen by TRD because it's inside the standard deduction. She' s not a legal entity but she is registered as self employed and files returns.