Previously, our Thai Tax Expert talked about the changes made by the Revenue Department in the Thai tax laws, particularly in the Personal Income Tax rule for married couples. In this post, we want to give more information about the allowed deductible expenses, allowances and filing options for married couples.

Deductible Expenses

The expenses are divided equally among the spouses as the joint income proportion.

Allowances

Each spouse can use these allowances to calculate their income tax as follows:

1. Child allowance – each spouse can use Baht 15,000 (if the child is studying at the qualified level, each spouse can use Baht 17,000)
2. Home Loan Interest Deduction – each spouse is entitled up to Baht 100,000 of interest deduction. However, if they entered into a loan agreement together, each of them is entitled to Baht 50,000 of interest deduction.

Filing Options

A married couple may have 5 options in submitting their tax returns:

1. Each spouse files his/her tax returns separately;
2. They file their returns jointly, combining the wife’s income with the husband’s income and submit the tax returns under the husband’s name;
3. They file their returns jointly, combining the husband’s income with the wife’s income and submit the tax returns under the wife’s name;
4. They file their returns jointly but the husband files his Section 40(1) income separately;
5. They file their returns jointly but the wife files her Section 40(1) income separately.

Need help in filing your Thailand personal income tax returns? Contact MSNA now.

In one of our previous posts, we talked about Tax Clearance Certificate, which is a certificate issued by the Revenue Department to a non-Thai tax resident who is departing Thailand to indicate that he has already paid taxes or that he has provided a guarantor or securities as guarantee for tax liabilities and tax payable. In this post, we want to give more information about the types of tax clearance certificate in Thailand.

There are 2 types of Tax Clearance Certificate:

1. P. 3 Tax Clearance Certificate

This is issued to a foreigner who is temporarily departing Thailand. It is valid for a single departure and must be used within 15 days from the issuance date. If he/she could not depart Thailand within the specified period, P.3 Tax Clearance Certificate becomes invalid unless he/she renewed it before the expiry date.

• P.3.1 Tax Clearance Certificate

This is issued to a foreigner who enters and leaves Thailand on a regular basis due to his/her business or profession. It is valid for multiple departure within the specified period in the Tax Clearance Certificate but not exceeding 180 days from the issuance date. P.3.1 Tax Clearance Certificate cannot be renewed.

Consult with MSNA how to get a Tax Clearance Certificate.

As part of Covid-19 subsidy scheme to small and medium enterprises, the Thai government is giving three-month subsidies to SMEs registered in the Social Security system. Such SMEs are the companies with not more than Baht 5 million capital and their gross income has never reached more than Baht 30 million in any accounting year. The subsidy will be at a rate of THB 3,000 per employee per month for 3 months from November 2021 to January 2022.

In order to qualify for this subsidy, SMEs must register to join the scheme from now until November 20, 2021. However, if the company has not registered with SSO e-Service yet, they have to be registered in the system first before they can register to join the scheme. SSO e-Service is the online system of the Social Security Office whereas the company can also add new Thai employees when they join the company or remove their names once they resigned.

Know more about this subsidy and check out if your company can apply for this scheme.  MSNA Group has vast knowledge and experience in Thai accounting, tax and payroll matters. Contact us now for consultation.

What do we mean by “Representative Office in Thailand wants to earn income”? Many foreign companies first started their operation in Thailand as a representative office. They thought they only wanted to do the business activities that do not involve earning incomes, which are one or more of the below. Later they want to start selling their products/services in the country.

The activities that are allowed to be engaged by a Representative Office:

1) To report the business movements in Thailand to the head office or affiliated company or the group company;

2) To give advice on various aspects pertaining to the goods distributed by the head office or affiliated company or the group company to the distributors or the users;

3) To seek for the supply source of goods or services in Thailand for the head office or affiliated company or the group company;

4) To inspect and control the quality and quantity of the goods that the head office or affiliated company or the group company purchased or hired to manufacture in Thailand;

5) To disseminate the information in relation to the new goods or services of the head office or affiliated company or the group company.

When the head office overseas wants to change its course in Thailand, they need to apply for a foreign business license to operate their income earning activities. Then they need to cancel their representative office status. A representative office cannot be transformed into a branch office. This is because a representative office does not need to obtain a foreign business license. It just needs to notify the Department of Business Development who will issue a document called “Certificate of the Identification Number of the Juristic Person established under foreign laws which operates in Thailand”. However, a branch office of a foreign company, to operate their business in the Kingdom, needs to apply for a foreign business license.

MSNA Group has been helping foreigners set up their branch office, representative office, Thai limited company and BOI promoted company for 25 years. Consult with us for your business needs today.