Work Permit Needed If I Do Remote Work?

[manum]

Heyas all! This is my first post to this forum.

I am from Finland and I am going back to Thailand next January for 6 months. Now I am wondering if I can do remote work for a Finnish company in a legal way.

Do I need a work permit in Thailand if I want to do remote work for Finland? I am an IT-programmer and I could get my laptop with me and do remote work.

I have heard many people say yes's, no's and everything between. Now I am asking here because I am very unsure about this.

If I need a work permit, is it hard to get for a remote work? For which country do I pay taxes etc?

And if there is any addition information about doing remote work in Thailand, please let me know.

Thanks in advance!

[yuyi]

If you want to do it the 100% clean way, you need to create a company (Partnership, ltd or Co. ltd.), and then get your work permit for this company.

Your Thai company will invoice your Finnish company client for your work.

I order to get the work permit, sooner of later the authorities will demand that you hire some Thais, especially if it is a Co. Ltd and not just a Partnership.

All in all, get prepared for monthly costs of 10000 to 20000 baht. You need to pay social insurance, thousands of little taxes, and a good accountant to do all the accounting and tax work for you. And it takes 6 months to set all up, so you should not work before you have your work permit, which might result that you just get it the day you get on the plane back home, after your 6 month stay is over.

Yeah, I know, it's bullshit, if all you do is to work on your laptop for a company outside of Thailand (may be even as employee??? only), but as far as I understood it, this is the clean way.

Now you just want to do it for 6 months, so you might get away with coming here on vacation, and doing some playing with your laptop for your job (as employee) back home, then I think nobody will complain

That's what I learned asking similar questions to some experts at the law and accounting companies here.

[Indo-Siam]

Manum -

I suggest that you simply try to get a one-year, multiple-entry Class B visa from a Thai diplomatic post in Europe - tell them that you want to explore setting up business in Thailand.

If you get that, simply come here, get an apartment, set up an ADSL line, and go to work. No Thai officials will care, or bother you.

Once every 90 days, you will have to make a border run - fly out and back the same day, or take a VIP bus out and back to Cambodia.

If you do want to get formally established in Thailand, you will have to start a Thai Private Co. Ltd. - and most of what the previous poster laid out is correct.

But - it does NOT take six months. We can get a company started, and get you a work permit to serve as Managing Director of that company within 30 days - no problem. In a pinch, we could possibly do it in three weeks.

Good luck!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[yuyi]

c89109, may I ask back, what have you been smoking, didn't you read?

That's what I learned asking similar questions to some experts at the law and accounting companies here.

Feel free to correct it, if you know better. manum, I and probably many others would like to hear good advice!

Steve,

No Thai officials will care, or bother you.

yes, I agree, but he explicitely asked for the legal way, and these are the answers other experts did give.

You give the same practical advice I gave,

you might get away with coming here on vacation, and doing some playing with your laptop for your job (as employee) back home, then I think nobody will complain

but, is this the legal way?

I would really appreciate your expert opinion, can somebody legally work her, may be only for a few month, and self employed or for a company outside of Thailand, without a work permit? I got told, no, it is not legal, but if you do not step on somebodies toes, nobody will bother you.

It is good to hear that you can do a company setup, including getting the work permit, within 30 days or even in three weeks. That's really great, and that speaks for your company! I will remember that next time I get asked to recommend a lawyer / accountant for a company setup.

But there are many many other companies out there, and I have seen not one case where it took just 30 days, but several cases, where it indeed took 6 months to get the work permit, and that without that there have been any special reasons. So I would not tell anyone that it takes less time, and then he/she tries it and it takes 6 months.

This also opens up the question about how long we can get away with just working silently? Or, in other words, after which time would you recommend the original poster to get legal and register a company? Not yet for 6 months, OK, but when? 9 months, 1 year, 2 years, ...?

[manum]

Thanks for all answers. I really think I will skip on working and enjoy my long holiday I will still call to Thai Embassy in Finland tomorrow and ask about their opinion. I will post here what they tell me.

[Martin_F]

A far as I know, you don't need to set up a limited company. You can try for a limited partnership where the requirments are a lot less rigerous.

You can also become a branch office of the overseas company. That way you don't need to set up a legal entity. Although there are the same type of restrictions on thai-foreigner ratios.

I do understand that there are companies that will employee you and act as an employer for you.

Other options are Malaysia. Which is equally as nice, better standard of living, better infrastructure, English more widely spoken, but beer is more expensive.

Anyway I think that the main thing is that you will not be engaging in business here, merely programming for an overseas company. If you were servicing Thai clients or visiting suppliers then that would be construed as work in Thailand.

But as they have said that as you are merely programming for an overseas company then it would be ok.

But then you come onto the income tax issues and that gets a little unclear. I would suspect that you have to pay Thai income tax as the income is remitted to Thailand? This is where expert adivse should be sought.

Anyway good luck.

[Indo-Siam]

Hi Yuyi -

These days, at least in Bangkok, a work permit is issued (assuming the application approved) seven days after submitting application. Application requires a form, a couple of photos, medical certificate, copy of university diploma (or alternate document) and copies of company incorporation and tax documents. Unless the applicant fails to get documents together, we have never taken longer than two weeks for this sequence.

Company formation, and VAT/tax registrations can theoretically be done in about 12 days. I don't think we've ever taken longer than maybe six weeks - and that only happened when client wanted MOA signature form signed by shareholders in four separate countries. If all shareholders are in Thailand, I cannot imagine a half-competent service provider taking longer than 30 days to process formation of a Thai Private Co. Ltd. I too have heard of eight weeks, three months, even six months. These are disgraceful delays, and totally absurd.

In 95% of cases, the single biggest delaying factor is the client's inability to line up the documents needed to document the office address at which he will officially register the business - including building ownership documents and identity documents of building owner - which are needed to achieve VAT and tax registrations. So long at service provider drills into client the need to push this one issue from very beginning, the process will unfold resaonably quickly.

We control several addresses (one on Asoke, one of Ruam Rudee) where we can arrange legal address registrations quickly. If client is really in a hurry, and is willing to pay a bit more in fees, we can get him a fully legal company in two weeks - we do so by providing business address, all seven shareholders, and director - and registering the comany name, business objectives, and capitalization level that client wants. 13-14 days from receipt of payment, we have company fully incorporated and registered. Client shows up, arranges for the business address he really wants to occupy long-term, and we execute one registration change to: relocate business address, and replace director and shareholders with replacement slate provided by client. Client then has the company he wants, at the location he wants, with the shareholders and directors he wants - and can now go open a bank account and commence business operations. Quick, painless, and virtually certain.

Cheers!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[yuyi]

Thanks for all answers. I really think I will skip on working and enjoy my long holiday  I will still call to Thai Embassy in Finland tomorrow and ask about their opinion. I will post here what they tell me.

manum, may be this did not get really clear, after so much focussing on the legal question: As Steve said,

I suggest that you simply try to get a one-year, multiple-entry Class B visa from a Thai diplomatic post in Europe - tell them that you want to explore setting up business in Thailand.

If you get that, simply come here, get an apartment, set up an ADSL line, and go to work. No Thai officials will care, or bother you.

Many many are doing it this way, and especially if this is for a short time, i never heard of anyone getting bothered indeed. Just do not engage in any business in Thailand with Thais...

Another question is the question you asked, what is the legal way, and that remains unclear, as you noticed already.

[yuyi]

Hi Steve,

your service seems to be very professional! (I should have seen you earlier )

That is what I would expect from an expert, but that's not what you get from 90 % of the experts here unfortunately.

But you did not share your expert knowledge about the main question and I guess there is a reason for that.

I assume that what I got told about working here is legally correct: You need a work permit before you even move one finger here for anything which could get interpreted as working.

But, because this is bullshit, and simply impossible to do, especially in the preparation of the registration of a company or in cases such as the one described by manum, you do not need to worry about it, at least not for for some (?) time, and if you do not do any business with Thais / in Thailand.

I understand if you do not want to make a clear statement here, but isn't it the case, that, if we do not look at the practical side but at the legal side only, manum would need a work permit even if working for just one single day?

I think also about the case, where someone gets sent by his company to work on a trade show here. I never got the clear answer that he would not need a work permit? Don't get me wrong, I do not mean the way it is done, I mean the way the law here does say it should be, even if nobody enforces it. To my astonishment I always end up with answers like, "well, the law says you need a work permit"...

Steve, is that really true, or do these experts just try to sell their services?

[LivinLOS]

Please take this with a handfull of salt instead of the usual pinch as it comes from the ThaiImmigration.com website (often not correct) which is the official unnoffical web board of Nong Khai immigration

http://www.thaiimmigration.com/inv/index.p...=46&hl=offshore

As you can see from the statements there they clearly say that telecommuting / IT work is legal and permissable...

Personally I would call this as another thng they have wrong if you want to be 100% legal but it does show that working and recieving pay outside of Thailand seems to be very low on thier list of things not to do.

[LivinLOS]

The rule for short stay employment is different country by country.. .I used to sepcialize in international labour leasing throughout Europe and there the DTA agreements are usually 183 days (6 months) that you can work and pay taxes in your host country, recently self employment became bothersome as many people were claiming to pay taxes in the host country and never doing so or declaring earnings thereby stepping outside of the tax system. To close these loopholes self employment (of non native labor) has become impossible in many industries such as construction.

Specilaists such as surgeons have certain extra leeway and the system can always be made a mockery of when you quote a long distance lorry driver driving through the country (shoud he register and pay tax for the miles he drove in transit ??). Other nice ones to quote to annoy taxmen are airline staff and trolly dollys.

Last time I was quoted an exempted time span for Thailand it was 3 months, one wonders if this is cumulative or not as a one year B visa with 4 visa runs would have you outside if the country each 3 months ...

[Darknight]

Step out of your Finnish mindset of doing thing Legally

In thailand doing things legally is completely different from doing thing normally or doing things illegally.

The only thing you have to worry about is your visa requirements. Nobody cares if you connect your laptop to program something in farangland, play the stock market, play an online casino ect...

Try to get a non O/B type visa, do a visa run and work as hard or as short as you want.

As long as money is coming into thailand it's already ok for them. The problem is when you want to get the money you made out. So have your employer deposit it in a finnish bank and take it out of the wall in LOS, easy ... simple... no hassels..

How are they gonna prove that you work when you're just surfing the net anyway

[Indo-Siam]

As I understand the law, in practical terms, you are not considered to be working in Thailand if:

1) You have no organizational entity in Thailand for whom you are employed

2) No money/payment changes hands in Thailand

3) Your activity does not involve buying or selling anything to individuals or busineses in Thailand, and you do not interact with buyers, sellers, or others in Thailand.

If you are in your home, doing something - anything - on your computer, and exchanging e-mail traffic with people outside Thailand, Thailand has no interest in you - period.

I do not have the energy at the moment to pitch the full pitch here - it is in the message archives on this board, from maybe a year ago - but it was a description of a mythical court appearance in Thailand by a farang accused of illegally "working" in Thailand. It was a description of the prosecutor presenting the evidence against the accused to the judges - actual photos and videotapes of the defendant "working". A few examples:

Photo #1 - The defendant is the fourth farang in line in this photo of a queue at an ATM machine (or western union office), where he was retrieving his pay.

Photo #2 - The defendant is the second farang from the left, in the red shirt, in this photo of an Internet shop (with 15 farangs in the photo).

Photo #3 - In this photo from the FEDEX office, the defendant is the eighth farang in the queue, waiting to ship the merchandise that he is exporting from Thailand.

Photo #4 - This is the farang picking up a business-related FAX message from some company in Finland - and here is that FAX (in Finnish) showing what we believe is a process flow for some software program.

etc., etc. Thailand is a nation of laws, and if they want to arrest yand convict you, they have to try you - and someone would have to prove you were guilty of a crime by presenting evidence, and no judges I know would tolerate such ridiculous evidence being presented in court.

Reduce the argument to absurdity, and it goes away.

Cheers!

Steve

Indo-Siam

[LivinLOS]

I tend to agree with Indo Siam that working from home via a laptop being paid outside Thailand is pretty safe and may even be totally legal...

Thailand is a country where some rules are not enforced and many rules have different ways of percieving them, just to show how backwards these rules can be in the same thread where Nong Khai states that telecommuting is OK they also state

The definition of work according to Thai Law:

“WORK means, to engage in work by exerting physical energy, or using knowledge, whether or not in consideration of wages, or other benefits”.

Confusing huh ??

[Sunny Valentine]

Apart from the logical dilemma you get when you define a word by using the same word in the definition, this definition leads to absurd consequences.

For instance a professional sports crack on holiday in Thailand would have to have a work Permit in order to do some work out.

Indo Siam I guess puts it right by "Reducing the argument to absurdity, and it goes away." But: There are lots of seemingly absurd regulations here, that are constantly or sporadically enforced; from Visa rules to things like a 20 Year age limit for partonising Bars, but only 18 to work there; so one cannot really rest assured.

Sunny

[yuyi]

Steve, thanks for this explanation! This is really helpful information.

[manum]

I called to Thai Embassy in Finland and they said don't need a work permit for remote work.

[yuyi]

manum, you did not happen to ask them for how long you can do remote work without a work permit? 6 months? 6 years? Forever?

[Darknight]

QUOTE 

The definition of work according to Thai Law:

“WORK means, to engage in work by exerting physical energy, or using knowledge, whether or not in consideration of wages, or other benefits”.

So if you really want to read the letter of the law you could say that:

If a farang thinks, he would be working

If you jog even if not receiving a wage you're working

If you take a girl home (physical energy) for "other benefits", you're working as well :D

[bkk_mike]

My two pence worth...

I telecommute, and I did look (briefly) into the option of working for the Thai branch office of the company I work for.

HR in Thailand came back with the problem that, since I wasn't reporting to anyone locally, not working in the branch office (I work from home), and didn't have anything to do with anyone in the Thai office, that there would be problems getting a work permit. (because they have to show where I would appear on the company org. chart - and since my department isn't one with any employees in Thailand - I basically wouldn't appear on it anywhere). I'm not certain it isn't HR simply trying to avoid hassle though...

However, telecommuting to my job in London, I don't need a work permit... (odd - I know). Part of the reason is that there is no way to apply for a work permit to work as an employee of a company not in Thailand (look at the form sometime - you need to give the Thai address of the company you will be working for).

Apparently, there is legally no difference between your telecommuting, and someone on holiday logging in and checking their email. There is no way for a court to classify one as work without also classifying the other as work without a change to the law, and Thailand would lose some well-off tourists if it started saying they needed a work permit or a B visa if they wanted to check their email while here on holiday.

As stated on the thaiimmigration site - I actually have to visit the London office frequently enough that I've never bothered applying for a permit to stay. But apparently Immigration have no issues with extending your visa (assuming you either have a Thai dependant, or are over 50 and classed as retired), and with your income paid abroad, it's fairly easy to show enough offshore income to support you. (especially as you're usually earning a rich-country income for the work, not the rate you'd get in Thailand).

However, if you don't fit into one of the non-O categories, you do have to do visa runs, or go the whole hog, and set up a Thai company to work through...

Tax-wise, you need to take advice if you're going to be in Thailand more than 183 days a year. This is because, less than that, you are not liable to tax in Thailand on offshore income. - More than that, and you are liable to tax on offshore income that you take into the country (subject to any relevant double-taxation agreement if you are taxed on it in your home country).

[LivinLOS]

Tax-wise, you need to take advice if you're going to be in Thailand more than 183 days a year. This is because, less than that, you are not liable to tax in Thailand on offshore income. - More than that, and you are liable to tax on offshore income that you take into the country (subject to any relevant double-taxation agreement if you are taxed on it in your home country).

My interpretation (not being a lawyer) is that if I am only allowed tourist status it would be very awkward to ry and tax me again on money I spend as a tourist.

Did you get that 183 day figure from your home country or from Thai authorities ???

It would seem to me a little 'rich' to say that a person can have no visa or rights other than a tourist and yet claim residency and offshore / global income. Thats not to say its not true as I have heard many tax offices lay claim to me over the years but that would probably take the cake..

I am actually maintaining residency (legal) in a N African arab state currently that has no taxes on worldwide income made outside of that state, but in a post 9/11 world having an arab N African address plays ###### with gaining offhore bank accounts credit cards etc.

[bkk_mike]

Tax-wise, you need to take advice if you're going to be in Thailand more than 183 days a year. This is because, less than that, you are not liable to tax in Thailand on offshore income. - More than that, and you are liable to tax on offshore income that you take into the country (subject to any relevant double-taxation agreement if you are taxed on it in your home country).

My interpretation (not being a lawyer) is that if I am only allowed tourist status it would be very awkward to ry and tax me again on money I spend as a tourist.

Did you get that 183 day figure from your home country or from Thai authorities ???

Actually - I misremembered it.

checking on http://www.rd.go.th/publish/6000.0.html , it's 180 days, not 183.

And it's quite normal for a country where you are living to tax you on the money you're taking into the country (assuming you haven't already paid tax on it elsewhere - in which case a double taxation agreement may come into effect).

As far as being a tourist, it's quite common for a country to assume that, after more than half the year in the country, you're no longer a tourist. (the same thing happens with people working in Australia while travelling - if they stay there more than 6 months, they're suddenly eligible for Australian tax allowances, and can usually claim back some of the tax that they've already paid if they've been working...)

[yuyi]

I did read in a book about taxes in Thailand, that you do not have to pay taxes in Thailand for income

• which you get outside of Thailand, and
  
• which you do not bring into Thailand in the same year in which you earned it.
  

Can you manage to do that? Bring in only your income which you got last year?

[ovenman]

Apart from the logical dilemma you get when you define a word by using the same word in the definition, this definition leads to absurd consequences.

For instance a professional sports crack on holiday in Thailand would have to have a work Permit in order to do some work out.

Indo Siam I guess puts it right by "Reducing the argument to absurdity, and it goes away." But: There are lots of seemingly absurd regulations here, that are constantly or sporadically enforced; from Visa rules to things like a 20 Year age limit for partonising Bars, but only 18 to work there; so one cannot really rest assured.

I've always been of the impression that the definition of work is left deliberately vague so that the powers-that-be could interpret work as they desired when they feel the need for a good ol' Thai crackdown. That said however, I truly do feel that the general situation regarding foreigners in Thailand would have deteriorated beyond the fringe of audience comprehension if the authorities ever did start hassling the average punter sending a work-related email from an Internet cafe. As Indo-Siam pointed out in his well-reasoned scenario posted over a year ago, if the authorities really had it in for you it would be far easier for somebody to plant some drugs on a person than it would be to haul that person to court because they were ostensibly working by sending emails.

[ovenman]

Can you manage to do that? Bring in only your income which you got last year?

I suppose it would be interesting trying to prove/disprove whether the dollar I have in my wallet was actually earned in 2003 or 2004.

[mokwit]

Two points

1) The definition of work in Thai law is something along the lines of 'exerting you energies' so strictly speaking it is difficult to do anything that is not pure tourist activity that is not classable as working e.g. voluntary work strictly speaking requirs WP even if unpaid.

BUT

2) Even if you are caught red handed with laptop connected to the internet the chance of actually being prosecuted for remote work are low because if you go high enough up in a Thai institution of any kind you hit somebody who 'gets it' and who will most likely understand that prosecuting someone for liasing over the net with a company overseas will criminalise most buyers of USD1m homes in Phuket etc and cause a lot of unwanted negative fallout amongst potential Elite Card holders. You would be sending out a message to IHT reading trust fund puppies they can't instruct their broker or laywer from Thailand on pain of arrest prosecution and deportation.

So my guess is that the lower brown shirt decision would almost certainly be over ruled on pure pragmatic/commonsense grounds.

[bkk_mike]

I would really appreciate your expert opinion, can somebody legally work here, may be only for a few month ... for a company outside of Thailand, without a work permit? I got told, no, it is not legal, but if you do not step on somebodies toes, nobody will bother you.

Who told you no?

Literally everyone I've ever asked about telecommuting has come back with - since I'm not working for a Thai company, not being paid locally, and not dealing with anyone in Thailand on a work basis, that it's OK. (that last bit is VERY important though).

[yuyi]

(bkk_mike @ Thu 2004-10-14, 22:18:12)

(yuyi @ Sun 2004-10-03, 23:41:59)

I would really appreciate your expert opinion, can somebody legally work here, may be only for a few month ... for a company outside of Thailand, without a work permit? I got told, no, it is not legal, but if you do not step on somebodies toes, nobody will bother you.

Who told you no?

Literally everyone I've ever asked about telecommuting has come back with - since I'm not working for a Thai company, not being paid locally, and not dealing with anyone in Thailand on a work basis, that it's OK. (that last bit is VERY important though).

Well, some years ago I started asking some of these experts, which put their ads in the bangkok post about registering companies, and doing work permits etc. for you. I did call some of them (forgot their names), and the farang boss of one of them told me that "no, it is not legal, but if you do not step on somebodies toes, nobody will bother you." and at the same time confirming what you write, that this is the way many farangs do it, and indeed nobody bothers them. But again, it would not be strictly legal.

So I did just go on, avoiding stepping on toes.

But then again, a couple of months ago, I had been for a different reason in contact with another farang consultant, and he then pushed me to "get legal", creating the impression that sooner or later the officials would probably review my situation, as they do routinely with the farangs living here. They would also read my emails, so they would know ...

Now I do not worry so much about the emails, thanks to pgp/gpg there is some privacy possible, but still I feel uncomfortable of being not legal somehow.

He then explained that it would be a tax issue, they would only want that I pay my taxes. And in order to do so, the more or less best / only way is to register a company etc. etc. and invoice from here. (Which is not practical at all, but that's another story).

This example of competence requested also to change a non-o into a non-b visa claiming that the non-b would be required to register a company and get a work permit.

Again, at the moment I don't want to give his name here in public, as there is still work (unrelated to this) in progress, which might get in danger if I do so now. But, just PM me, and I'll tell you, OK? (May be I do as proposed here, take him behind a bar and shoot him )

Now, thanks to all what I learned from steve and sunbelt and the many other contributors here, I think about cancelling the whole company registration again... it is time to retire anyway ... and to play with my computer, and on the internet, just for fun