Payroll in Thailand is the list of the company’s employees who are entitled to receive payments, as well as bonuses and other work benefits. It is understood as the process of paying the employees, and at the same time observing the requirements for making the needed salary deductions, and the timely payments to the social security contributions.
Our team of accountants in Thailand offers separate payroll services or provides these solutions as part of our comprehensive packages for companies. These services are designed to meet the needs of the business and to take into account the complexity of the payroll process according to the company’s average number of employees.
Local and foreign investors who need solutions for company formation in Thailand can reach out to our team of experts as soon as they decide to incorporate a new business or buy an existing one. Our team can provide you with adequate assistance and information and will offer services and guidance during the pre-incorporation phase as well as during the post-registration steps.
Table of Contents
Payroll requirements in Thailand
Payroll in Thailand is mandatory, and it is a process that will also include tracking the worked hours, as well as all the benefits the employee is entitled to, in addition to the salary (i.e., bonuses, or other types of compensation).
The employer in Thailand is required by law to observe the requirements for withholding the tax on employment income. The employer is also the one who remits the tax to the authorities on a monthly basis.
Both the employer and the employee make social security contributions of 5% of the employee’s monthly remuneration (up to an applicable monthly cap). The payment of this contribution is handled as part of the process of payroll in Thailand.
All employers in Thailand are required to follow the rules of minimum wages according to the skills of their employees. The value of the wage according to professional branches can change on a yearly basis. Below, our team lists the wage rates in three different sectors, as communicated by Thai authorities in January 2023:
- The industrial sector: starting at 496 baht for a powertrain system technician;
- The mechanical sector: starting at 465 baht for a farm tractor repairman;
- The service sector: starting at 475 baht for bartenders, or 500 baht for nutrition therapists;
- Penalties for failure to observe the minimum wages: fines, imprisonment, or both.
Outsourced payroll in Thailand
Companies will commonly choose to outsource the payroll process. some of the advantages of working with a third party that offers this type of service to companies include the following:
- make sure that an experienced, third-party payroll processor handles all the needed payments to the Thai authorities;
- the salary payments are made with the right amount (as per the needed calculations) and in due time;
- overtime, bonuses, and other types of compensation are properly taken into account;
- the company can use this service irrespective of its size or number of employees.
The employer remains the one who concludes the employment agreement and establishes the wages according to the current minimum amounts. He is also the one liable for failure to observe the entirety of the labor law requirements.
Our accountants in Thailand will give you more information upon request about our services for payroll. You can also reach out to us if you have any questions about the other applicable tax filing and reporting requirements.
If you are a Thai or a foreign business owner interested in topics other than payroll in Thailand, do not hesitate to reach out to our local team of experts. We also assist branches in Thailand that have questions concerning this topic.
We provide ongoing solutions for those interested in Thailand company formation and we specialize in assisting both local and foreign investors. Contact us for more information about our services.