There are certain occupations that are prohibited to non-Thai nationals as prescribed by the Ministry of Labour. If you are a professional lawyer in your home country and would like to practice your profession in Thailand, you should be aware that foreigners are prohibited to work and provide services in legal counselling, litigation and others such as representing as a lawyer in all types of cases, acting on behalf of clients in legal matters, drafting contracts or making legal documents.
However, there are some exceptions depending on the situation. Foreign lawyers can be allowed for the following works:
To perform duties of an arbitrator in an arbitration case;
To provide assistance or representation in the arbitral proceedings in the event that the law applicable to the dispute being considered by the judge is not Thai law. This includes the following:
Liaison for cases, research, compile and provide opinion on facts and legal issues to the arbitral tribunal or the parties;
Notetaking during the hearing using shorthand or other techniques in the same manner;
Presentation of opinions as an expert
Works involving special technology used in recording sound, images and evidence produced in the hearing
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.
During this pandemic, our clients asked questions about sick leave for COVID 19 cases. How many days can employees take off if they are sick? Normally the Thai labor law allows employees to take up to 30 days of sick leave per year. What can they do if they are sick more than 30 days a year? Here is the question from one of our clients:
Question: Is there any government regulation to give more sick leave if an employee is contracted with Covid-19? For example, if an employee is found to be COVID positive and if the person does not have any sick leave balance, can he use the annual leave to cover and can the company deduct no pay leave if they have used up all their sick leave?
Answer: The company cannot make him use his annual leave for his COVID sick leave after he has used all his yearly allowable 30 days of sick leave. You may deduct his salary based on the number of sick leave days in excess of 30.
In this COVID era, the employee may file a form with the Social Security Office for a compensation for his loss of income. The company will have to issue a letter confirming he has used up his 30 days of sick leave allowed by law attached with his sick leave request form.
One of MSNA’s payroll outsourcing clients asked us about the bonus scheme to be given to employees in Thailand.
Question: Our Thai company is currently still operating at a loss. We are studying into a variable bonus scheme to be given to the employees in Thailand and would like to seek your opinion on this matter. Do you know of any company in our industry or any M&E construction company which pays variable bonuses? If so, what is the average bonus quantum in terms of months? I guess the bonus should be peg to the company profits.
Answer: Regarding bonus scheme, it depends on many factors. For example, companies with western culture usually have a different bonus scheme from the companies with the Thai culture. In many cases, if the monthly salaries are already high, then the number of months for bonus is often lower than if the salaries are low. When you want your company to be an attractive employer, you can pay an attractive salary plus 13th month bonus or you can pay normal salaries plus many months of bonus. Also it depends on the quality of employees. The ones that are very good and can demand higher compensation will stay if the overall remuneration is better than other companies. The ones that are not in high demand will stay even though you do not pay them bonuses. We would suggest having different agreements on the numbers of months for bonus with different employees depending on the levels of performance and the difficulties of finding replacements.
However, if you peg the bonus on company’s profits, it is a non-tax deductible expense. That means all the bonus you pay that is dependent upon the company’s profits will get added back to the bottom line and treated as if it was never an expense of the company for the purpose of calculation of corporate income tax.
Consult MSNA for your questions regarding your doing business in Thailand.
This article is about tax on earnings which an employee received from the employer concerning the agreement of compromise. When the employee whose working period is not less than 120 days is terminated, the employer has to pay the employee the compensation according to the Thai Labor Law. The amount of the compensation depends on how long the employee has been working with the employer. This compensation is not subject to tax.
In the case that there is a dispute on unlawful termination in the labour court, if there is a monetary offer from the employer to settle the case and the employee accepts it, both parties can agree in front of the judge. The amount received according to the agreement of compromise before the judge is subject to tax because it is not considered a compensation stipulated in Labour Protection Act. It is considered an income under Section 40(1) of the Revenue Code, which shall be treated the same way as a monthly salary. Therefore, the employer has to deduct withholding tax at the progressive rate from the amount of settlement.
For questions regarding Thailand labour law, please contact our legal team at ThaiLawyers.com
The Thai Revenue Department has recently changed the personal income tax rates for the tax years 2013 and 2014.
If you earned income and taxes were withheld using the progressive rate during the year 2013, when you file your personal income tax return of 2013 whose deadline is 31 March 2014, you will most likely get some tax refund due to the fact that your employer withheld the tax using the rates that were in effect last year.
Here are the new personal income tax rates:
Net Taxable Income
Income tax rate
0 – 150,000
150,001 – 300,000
300,001 – 500,000
500,001 – 750,000
750,001 – 1,000,000
1,000,001 – 2,000,000
2,000,001 – 4,000,000
4,000,001 and more
If you need help to prepare and file your Thai personal income tax return, please contact MSNA. We have been providing foreigner income tax service for many years.
We would like to cut down the public holiday from 16 to 13 days per year. Do we have to send an official letter to the employees and submit this new company policy at the Labour Department?
Yes, you can cut down your annual public holiday to 13 days which is the minimum number of traditional holiday in Thailand per Thai labour law.
You do not have to take it to the Labour Department. Just post it on the company’s bulletin board, if you have one. But if not, just make a letter to announce it and have everyone sign it under the sentence “I have read and understood the above.”
Need help on Thai labour law issues, contact MSNA for Thai accounting, tax and payroll services for further consultation.
According to Section 29 of Labour Protection Act B.E. 2541, an employer shall announce not less than thirteen traditional holidays per year in advance for employees, including National Labour Day as specified by the Minister.
The employer shall fix the traditional holidays according to the annual official holidays, religious or local traditional holidays.
If a traditional holiday falls on a weekly holiday of an employee, the employee shall take a day off to substitute for the traditional holiday on the following Working Day.
Whereas an employer does not provide a traditional holiday to an employee because the employee performs work of such description or nature as prescribed in the Ministerial Regulations, the Employer shall make an agreement with the employee to take another day off to substitute for the traditional holidays or the employer shall pay holidays pay to the employee.
Contact MSNA for your business needs. Our team of experts can provide professional advice on Thailand accounting, taxation and Thai labor law matters.