How does a tour guide in Thailand pay taxes?
I need to inform my fellow tour guides about annual tax payments in a simple way. Normally, income from working as a tour guide falls under Section 40(1) and Section 40(2) of the Thai Revenue Code.
Section 40(1) refers to income from wages or salaries, such as receiving a monthly salary from a company.
Section 40(2) refers to any income earned from being hired by others, whether it involves labor or not.
If the income comes from being a full-time employee (Section 40(1)), the employer will calculate and withhold personal income tax on your behalf and submit it in advance to the Revenue Department. This withholding tax (P.N.D. 1) can be deducted from your total annual tax liability. If the company withholds too much, you can request a tax refund. If they withhold too little, you will need to pay the remaining amount when filing your annual tax return.
In the case of being a freelance tour guide without a fixed salary, the income falls under Section 40(2). If the client is a company, they will typically withhold 3% of your payment each time they pay you. They will then issue a Withholding Tax Certificate (Section 50 Bis) to you every time. You can use this certificate as proof to deduct the withheld tax from your total annual tax liability, similar to P.N.D. 1, which employers submit for salaried employees each month.
In the case where you earn income both as a full-time employee and as a freelancer, you will have income under Section 40(1) and Section 40(2). You must combine all income to calculate your total taxable income. There is no mid-year tax payment required for income under Section 40(1) and Section 40(2).
Tax Calculation Method:
| Total Annual Assessable Income from Section 40(1) and Section 40(2) combined. | xxxx.....(1) |
| Deduct Expenses (50% of assessable income, but not exceeding 100,000 THB). | xxxx.....(2) |
| (1) – (2) = Net Income After Expense Deduction | xxxx.....(3) |
| Deduct Allowances (as specified by law), such as: | |
| - Personal allowance (60,000 THB) | xxxx..... |
| - Child allowance (30,000 THB per child) | xxxx..... |
| - Life insurance premium (actual amount, up to 100,000 THB) | xxxx..... |
| More | xxxx..... |
| Total Allowances | xxxx.....(4) |
| (3) – (4) = Taxable Income After Allowances | xxxx.....(5) |
| Deduct Donations (as specified by law) | xxxx.....(6) |
| (5) – (6) = Net Taxable Income | xxxx.....(7) |
| Use the net taxable income from (7) to calculate tax based on the personal income tax rates (as per the attached table). This will determine the total tax payable for the year. | |
| For the 2024 Tax Year (B.E. 2567) | ||
|---|---|---|
| Net Taxable Income (Excess Amount) | Tax Rate (%) | Maximum Tax Payable |
| 1-150,000 | Exempt | - |
| 150,001-300,000 | 5 | 7,500 |
| 300,001-500,000 | 10 | 20,000 |
| 500,001-750,000 | 15 | 37,000 |
| 750,001-1,000,000 | 20 | 50,000 |
| 1,000,001-2,000,000 | 25 | 250,000 |
| 2,000,001-5,000,000 | 30 | 900,000 |
| 5,000,001 THB and above | 35 | ∞ |
Note: Net income up to 150,000 THB is exempt from tax under Royal Decree No. 470 B.E. 2551.
Tax Calculation Formula (Net Taxable Income−Maximum Income of Previous Bracket) × Tax Rate + Tax from Previous Brackets
Example: Suppose in 2024 (B.E. 2567), you have a total annual income of 400,000 THB. You are married, and your spouse has income but files taxes separately. You have one child, life insurance premiums of 50,000 THB, and a withholding tax certificate from clients showing 5,000 THB withheld.
The tax calculation is as follows:
| Total Annual Income | 400,000 THB | |
| Deduct | Standard Expenses: 50% of income (maximum 100,000 THB) | -100,000 THB |
| Deduct | Personal Allowance | -60,000 THB |
| Deduct | Child Allowance | - 30,000 THB |
| Deduct | Life Insurance Premium Deduction (within the 100,000 THB limit) | - 50,000 THB |
| Net Taxable Income After Deductions | 160,000 THB | |
| Therefore, the net taxable income is 160,000 THB. The first 150,000 THB is exempt from tax. The remaining 10,000 THB is taxed at a 5% rate. | ||
Calculation Method
Net Taxable Income: 160,000 THB Minus the maximum exempted amount 150,000 THB = 10,000 THB
Multiply the excess amount by the tax rate (5%) = 10,000 x 5/100 = 500 THB
In conclusion, for the 2024 tax year (B.E. 2567), the total personal income tax payable is 500 THB. However, withholding tax already deducted in 2024 amounts to 5,000 THB, meaning an overpayment of 4,500 THB (5,000 - 500). You can request a tax refund of 4,500 THB from the Revenue Department.
If there are additional deductions or charitable donations, the tax calculation may differ from the stated amount.
The income that the Revenue Department can verify for sure is the amount subject to 3% withholding tax, as employers are required to report and submit it to the Revenue Department. Most of these employers are companies, whereas individual clients generally do not withhold tax from your payments.
Personal Income Tax Filing Schedule
1. Paper Filing: You can submit your tax return at the nearest Revenue Office (you can search for locations on Google). The deadline for submission is March 31 of each year.
2. Online Filing: You can submit your tax return online at https://efiling.rd.go.th/rd-cms/ The deadline for online submission is April 8 of each year.