Work Permit/freelance Work

[jon_phillips]

Hi There,

I hope someone out there can help me.

I am from the UK, I am trying to track down the law on forigners doing freelance work in Thailand.

I already have a work permit in Thailand with one company, but have been offered some additional work, freelance, with another company.

Is there anything I need to know before taking on this freelance work, eg will it effect my work permit, what is the tax situation, are there laws against this ?

I look forward to receiving you replies.

regards

jon...

[Indo-Siam]

This is not an "official " answer - I will just tell you anecdotally what I have done, and what several others I know have done, without any problems.

I have a work permit working for one company (which I happen to own). I have on several occasions accepted work as an individual, outside the scope of my company - to perform financial business modeling for one company, in one case, and to work occasionally as a corporate trainer for another company. In these other cases, work was infrequent, and came up on short notice. Nothing that would allow practical submission of application for a new work permit.

In both cases, I was paid against a copy of my passport, receiving a receipt document along with my payment, indicating that 3% tax withholding had been accomplished, and listing my passport number. At the end of the year, I turned such receipts over to my bookkeeper who prepared my personal income tax return. She added these "casual payments" to my total income, also including the withholding as part of my paid-in taxes - and attching the receipts from my "casual" customers. The result is - nothing ever happend. Two years running.

I do NOT have a sole proprietorship with its own tax ID card. I do not specifically know of any law allowing me to work. What I do know is that I have reported my income and paid tax on it - so whatever problems I may have with other departments, the revenue people can have no complaint. It is my conclusion that there is little(probably no) feedback between revenue department and other agencies. But - both of the companies that hired me wanted to write my billings off against income, so they went the receipt route. I did NOT bill for VAT. They did withhold 3%, and turn a receipt to that effect over to revenue department. Thus there were"orphan" audit trail documents floating around within the system, and I wanted to make sure they matched to something - my report of income earned in that amount.

So - if you work on a cash basis, no receipts - I suggest you not talk about it. If you want to "do the right thing" and your second employer wants the same, you can have his bookeeper prepare receipts against your passport (not your work permit), and keep all books balanced that way - by you turning all such receipts over to the person preparing your tax return, and paying everything above board.

The only thing I would strongly advise against doing would be to accept payment that incliudes some sort of accounting receipt, and then NOT report and pay taxes on this income. Throughout the world, tax collection agencies ALWAYS have the ability to make SERIOUS trouble for anyone who they can document as having avoided paying taxes that were due.

I also suspect that if you have some Thai furiously angry with you for some unrelated reason, and if they have contacts inside the Labor Department, and if they know that you have performed "illegal" freelance work, it is probbaly possible for you to get in some amount of trouble. Probably nothing that a few thousand baht, plus a promise to "never do such a thing again" couldn't put to rest.

Good luck!

Indo-Siam