When the tax year ends, everyone who has income has the responsibility to pay income tax or PND. to our country (Thailand). Many people who working in Thailand are still confused whether they have to pay tax or not. What is PND. and how important is it for tax filing? Who has to pay it? Today, we have collected some basic knowledge about PND. to share with you.
What is PND.?
PND. stands for “Income Tax“. It is a tax collected from individuals or entities with an income, with the tax rate based on the income received and calculated according to the relevant laws. Paying personal income tax is the responsibility of those who have an income according to the law, and it is an important part of the financial system that helps the government have sufficient resources to develop the country and provide better services to the public.
Personal income tax takes different forms and individuals or entities must file and pay according to the law and the time frame set by the Revenue Department. The types of personal income tax include:
1.Personal income tax:
Personal income tax for individuals is a tax collected from the general public or from special tax units, as specified by law and with income generated according to the specified criteria, normally collected annually. For example:
PND. 90 (ภงด. 90)
PND. 90 is a form for individuals with income under sections 40(1) to 40(8) of the Revenue Code, of various types or one type, but not under section 40(1) of the Revenue Code, for individuals with general income, such as rental income, stock market investments or self-owned businesses, with a filing deadline from January 1st to March 31st of the following tax year.
PND. 91 (ภงด. 91)
PND. 91 is a form for individuals with income from employment under section 40(1) of the Revenue Code, with a filing deadline within 31st March of the following tax year.
PND. 93 (ภงด. 93)
PND. 93 is a form for requesting to pay tax in advance before the regular filing deadline.
PND. 94 (ภงด. 94)
PND. 94 is a form for filing and paying personal income tax for the first six months of the year, for individuals with non-salary income such as income from commissions, copyright royalties, dividends, etc., under sections 40(5), (6), (7), (8) of the Revenue Code. The deadline for filing this form is from July 1 to September 30 of the same tax year.
2. Corporate Income Tax
Corporate Income Tax is a type of tax established under the Revenue Code, collected from the net profit of companies or partnerships registered under the Commercial and Civil Code, and also includes other legal entities that are not registered under the Commercial and Civil Code.
PND50 (ภงด. 50)
PND 50 is a form used to show the details of corporate income tax for the year, calculated from the revenue obtained from selling goods or services and used to calculate the tax owed.
PND51 (ภงด. 51)
PND 51 is a form used to show the details of corporate income tax for a half-year accounting period (6 months) for general SMEs and start-ups. The net profit or loss for the whole year is estimated and the tax is calculated based on half of that estimate. If the estimated net profit is underestimated by more than 25% of the actual net profit for the accounting period, an additional 20% of the tax owed must be paid. Businesses must file the form within 2 months from the last day of the accounting period.
3. Withholding tax
Withholding tax is a way of collecting advance tax by requiring the person paying the income to deduct tax from the payment to the recipient every time. The tax withholding must be in accordance with the criteria, methods, and conditions specified, and then the money should be sent to the Revenue Department.
PND.1 (ภงด. 1)
PND.1 is a form for reporting income tax withheld at source for payers who are individuals, partnerships, companies, associations or corporations paying income such as salaries, wages, and commissions to taxpayers who are natural persons. The payer who is responsible for withholding tax must submit the PND.1 form within 7 days from the end of the month in which the payment was made.
PND.2 (ภงด. 2)
PND.2 is a form for reporting income tax withheld at source for payers who are individuals, partnerships, companies, associations or corporations paying income such as copyright fees, royalties, interest on deposits, interest on bonds, dividends, etc. The payer who is responsible for withholding tax must submit the PND.2 form within 7 days from the end of the month in which the payment was made.
PND.3 (ภงด. 3)
PND.3 is a form for reporting income tax withheld at source for payers who are individuals, partnerships, companies, associations or corporations paying income such as rent, contract payments, service fees, manufacturing fees, advertising fees, transportation fees, etc. The payer who is responsible for withholding tax must submit the PND.3 form within 7 days from the end of the month in which the payment was made.
PND.53 (ภงด. 53)
PND.53 is the form for submitting withholding tax on income paid for cases where the payer is a government agency, state enterprise, company, partnership, or other legal entity that pays income in the form of property rental fees, agent fees, service fees, advertising fees, transportation fees, or other fees where the recipient is a legal entity. The payer who withholds tax at the source must submit Form PND.53 within 7 days from the end of the month in which the income was paid.
4.Value Added Tax
Value Added Tax (VAT) is a tax collected from the sale of goods or services at each stage of production and distribution, whether produced domestically or imported from abroad. The Revenue Department is responsible for collecting this tax, which is currently set at a rate of 10%. However, there is a special legislation that reduces it to 7%, and it is renewed annually.
PP30 (ภพ. 30)
Por Por. 30 is a summary tax return form to be submitted to the Revenue Department, for businesses with annual income of over 1.8 million baht who have registered for VAT. It must be submitted to the Revenue Department every month by the 15th of the following month or can be submitted online.
5.Specific Business Tax
Specific Business Tax is a type of tax under the Revenue Code that is collected from specific business operations instead of the abolished trade tax. The Specific Business Tax was enforced in 1992, along with the Value Added Tax.
PP.30 (ภพ. 30)
This form summarizes the sales tax and purchase tax for submission to the Revenue Department. It is prepared by the business owner with an annual income of more than 1.8 million baht who has registered for the Value Added Tax. The form must be submitted to the Revenue Department by the 15th of each month or can be filed online.
PT.40 (ภธ. 4 0)
The PT.40 form is a summary of the Specific Business Tax under the Revenue Code. Business owners with multiple workplaces who wish to submit the form and pay the tax together can do so by obtaining approval from the Revenue Department. Once approved, they can file the PT.40 form with the necessary attachments as specified by the Revenue Department.
What is the income threshold for filing personal income tax?
In the case of personal income tax:
The income tax rates for individuals (effective from the tax year 2017)
|Net Income (Baht)||Net income range (each level)||Tax rate (%)|
|1 – 150,000||150,000||Exempt|
|150,001 – 300,000||150,000||5|
|300,001 – 500,000||200,000||10|
|500,001 – 750,000||250,000||15|
|750,001 – 1,000,000||250,000||20|
|1,000,001 – 2,000,000||1,000,000||25|
|2,000,001 – 5,000,000||3,000,000||30|
In the case of corporate income tax
For SMEs businesses that have registered capital paid up not exceeding 5 million baht and have annual income from sales of goods and services not exceeding 30 million baht throughout the year, the tax rates are as follows:
|Net Income (Baht)||Corporate income tax rate (%)|
|Less than 300,000||Exempt|
|Over 300,000 but not exceeding 3,000,000||15|
In the case of ordinary persons or companies that do not meet the criteria for SMEs, they are subject to a tax rate of 20 percent on net profit for businesses with annual income exceeding 1.8 million baht and registered for value-added tax, whether they are natural persons or juristic persons. They must submit Form P.P.30 to summarize sales tax and purchase tax and file it with the Revenue Department by the 15th of the following month, regardless of whether there are any transactions during that month.
In case of failure to pay taxes on time
Any person who submits tax returns within the deadline but does not pay the full amount of taxes due or submits the returns late, or avoids submitting the returns, shall be liable to pay additional money and penalties as prescribed by law. If they still refuse to pay, they shall also be punished with criminal penalties, as follows:
- In case of failure to pay taxes within the deadline, they shall be liable to pay an additional 1.5% per month (counting any part of a month as a full month) of the taxes due from the date the returns were due until the date the taxes are paid.
- In case a tax officer inspects and finds that the taxpayer has not submitted the returns or has submitted them but paid less than the amount of taxes due, they shall be liable to pay the additional money and a penalty of 1 or 2 times the amount of taxes due, depending on the case. The penalty may be reduced or waived by the Director-General with the approval of the Cabinet.
- In case of failure to submit the required tax returns (Form PND 90, 91 or 94) within the deadline, they shall be liable to a criminal fine of not more than 2,000 baht.
- In case of intentionally providing false information or evidence to evade or attempt to evade paying taxes, they shall be punished with imprisonment for a term of 3 months to 7 years and a fine of 2,000 to 200,000 baht.
- In case of intentional failure to submit the required tax returns to evade paying taxes, they shall be liable to a fine of not more than 200,000 baht or imprisonment for not more than 1 year, or both.
Income tax is a tax that arises from the payment of taxes on income received, which is an important source of income for the country’s operations and development. Normally, income tax rates vary depending on income and taxpayer status. Paying income tax is the responsibility of taxpayers in supporting the country’s development and is a choice to help create a sustainable society. Therefore, we should not ignore or avoid paying taxes as required by law, as it not only causes the state to lose income, but also poses risks in terms of both civil and criminal liability.
SEO Specialist and Client Success at RLC Outsourcing