Working in Thailand while still employed officially in the UK

[dantilley]

Can anyone advise on the legalities of working in Thailand while still officially employed by a UK company and still receiving a normal salary into a UK bank account?

We want to do this 100% legally with proper work permit and visa. Our company is not a branch office of the UK company or in any way affiliated with it (other than them being a client of ours), but someone from this company will be working in our office in Bangkok for about 3 months.

Specifically:

• For the Work Permit, will we need to show that they are being paid in Thailand, and therefore paying tax here, during this period?
• If so, will the person be able to not pay tax (or claim a rebate) in the UK due to paying tax in Thailand during this period? Or will they basically end up paying 2 lots of tax, here and in UK?
• Will they also need some kind of contract with our company, and therefore become a temporary employee of ours for the 3 months?

Would really appreciate any advice on this. There may be more questions to follow too

[hohososo]

You will need to setup a corporation in Thailand. And hire four Thais at minimum. And require a few million baht in capital.

It is a pain to so what you propose legally.

You do not just apply for a work permit.. a corporation registered in Thailand must hire you, or you must start a corporation and effectively hire yourself.

Edited July 7, 2016 by hohososo

[dantilley]

Thanks but I think you misunderstood my post slightly. This isn't for me, but the company I work for is bringing someone over from the UK to work in our office. We have all the requirements in terms of company setup to provide a Work Permit for this person, that's not an issue at all. We already employ over 120 Thais and about 20 expats.

[fletchsmile]

You're probably best off at some point talking to one of the reputable accounting firms that also deals with work permits and tax. Someone like Mazars, RSM, Grant Thornton etc as second tier firms would be fine.

The guy will first need a business visa. That would about entitle him to be here and attend meetings but that's about the extent of it. So on the strength of that he will then also need to get a work permit. Even though you think he'll be here 3 months, apply for longer in case he is needed longer

There are different ways you could structure things. A clean and simple way that would probably not cause hassle:

Give him a short term secondment contract and pay him in Thailand for the work done in Thailand, and pay tax on it here. That doesn't need to be fully what he got in the UK but does need to be above the labour law minimums - around THB 50k minimum for a UK national (check this number might have gone up). It also needs to look sensible and reasonable in the context of what others earn. You'd practically be having to pay him some sort of allowance, accommodation etc for him to be here anyway. So those extras could cover/be that salary.

Meanwhile he retains his UK contract as I assume he'll be going back. He'd then be taxable still in UK on UK income as 3 months out isn't enough to get him excluded as non-resident for UK tax. So keep it simple for him and leave things as is there.

That would end up paying tax in both places. But keeping the UK as is, is simple for him, and have a separate contract for Thailand for the incremental/ extras. i.e he is paying tax in two places buy not on the same money. eg pay tax on GBP 5k in UK and pay him GBP in UK and pay him say THB 100k here in Thailand.

Still worth talking to up to date experts like accounting firms though, as things change all the time. They may suggest something different. Also if you provide him with a car/ accommodation etc that needs to be accounted for in some way for tax.

These type of firms do packages for visa + work permit combined. More expensive than doing it yourself obviously, but takes away the hassle. Think THB 25k - 30k + out of pocket for that. Then tax advice help on top. Sure you could get cheaper on the visa + WP side by doing yourself or a smaller local agent, but if you're also wanting tax help go with a reputable firm and reduce the headache.

Based on the size of your company and what you've said, you're right to try and do it all legit. That's why i'd also suggest a decent firm. You don't want headaches for the guy or your company. A few hundred/ couple of thousand quid is nothing in the context of a valued employee to have a smooth stay

Edited July 7, 2016 by fletchsmile

[Bunnychow]

Same advice as i gave another poster in visa's who is doing something similar...go and see a company who is experienced in both Thai and UK tax law, your circumstances would be quite complicated with reciprocal tax agreements etc and residency/non residency for tax purposes in both jurisdictions, dont try and DIY it, you may end up getting bitten on the bum...someone like Price Waterhouse Coopers willgive you good advice, but it will cost you

[dantilley]

Many thanks for the great advice. So in summary, it seems that tax will be paid in both countries, but best to speak to some professional experts on how to alleviate that, and for a smoother process in general.

Thanks again!

[sometimewoodworker]

The UK and Thailand have a a tax treaty.

He will have to declare his income in Thailand to the Thai tax authorities and pay tax if needed.

Probably

He will also have to declare the same income to HMRC and the amount of tax payed

The taxation agreement accepts the tax payed in Thailand will offset the UK liability.

https://www.gov.uk/government/publications/thailand-tax-treaties