6 Tax Categories that Start-Ups should know.

Every entrepreneur, before starting a business or having their own company. Of course, there are tax laws involved. To be prepared, let’s get to know about 6 tax categories that should be known as follows:

Personal Income Tax

The duty of Thai citizens who earn income as stipulated by the law is obligated to pay taxes. Taxpayers usually show their income certificate regularly from January to March of the following year. In some cases, it has to be a half-year tax for income generated in the first half of the year, or a tax deduction paid in conjunction with it. To gradually repay, but can also apply for regular refunds in case of parenting, educational support, disability, disability support, and pension premiums that should be studied further.

This type of tax is the part required by law to be levied on corporations to pay taxes. It is usually a group of people who have registered as a company, a registered corporate mall, and not a community enterprise,  also start-ups like us who want to expand business in the future. The income tax returns will be listed in P.O.D. 50 to cut off the account that must be filed within 150 days of the closing of the accounting system in the company. In addition, P.O.D. 51 will be filed within two months after the tax accounting period in a half year. This kind of tax will be levied when the business progresses from 5 to 35% on a calendar year basis. Those who are required to file tax must earn at least 60,000 baht per year by filing on March 31, of the following year.

Corporate Income Tax

According to the Tax Laws and the Revenue Code, when we do business as a corporation or a department store, we have to pay taxes on this as well as other corporations. Even if they are not registered under recent and commercial law, or limited companies and limited companies. This type of tax will always be collected at a constant rate. Currently, it is scheduled to be 20% and applicable for a one-year reduction for SMEs and business accounting periods. Those who have to file this type of tax are usually a corporation that operates a company or a registered subsidiary and has a filing period of 150 days from the end of the accounting period. To calculate net profit from their own businesses and then subtract the expenditure specified in Section 65 bis and Section 65 ter with tax calculation based on income before deducting expenses, income paid from or domestically, and profit distribution abroad. 

Withholding Tax

It seems like it is written in a legal language or hard to read. In fact, it is not that hard to understand because it is the tax that will be deducted in advance. It’s also a tax credit for the person who’s been deducted. There’s also financial evidence to the background and a certificate of a tax deduction on a return. The person responsible for the tax deduction is the person who makes the payment, and the person who is taxed is the recipient of the money. It may be delivered with P.O.D. 3 when paid as an individual and P.O.D. 53 when deducted from a corporation. As for startups like us, we can also apply for tax refunds in this category. The law stipulates that if our business or our partner purchases, we will deduct taxes when each type of payment is made and based on the tax rate. For this kind of tax, we should be doing more studying because businesses must register VAT. For example, Tax VAT from buyers of goods or services, tax invoices may be issued in paper or electronic form, tax reports, acquisition tax, and sales tax, and must be submitted to the Revenue Department.

Value Added Tax (VAT)

We might be familiar with VAT because it is in our daily life. Every time we buy a product, whether it’s for food or for goods, we have to pay this kind of tax automatically. At the rate of 7 percent, both acquisition tax and sales tax. However, for entrepreneurs like us, this tax will be collected from the value added by business people or when providing services by all the taxpayers, including all business operators, importers, retailers, exporters, manufacturers, and service providers. The annual income of 1.8 million baht or more must be filed in P.O.D. 30 if the operator is in Thailand and filed in P.O.D. 36 in case of overseas servers or software. Always sent on the 15th of the following month and is subject to registration, corporate or individual registration.

Revenue stamp

Not the stamps that are used in the letter. Every time a document is made about the law, this tax is always involved in 28 different ways, such as renting, leasing or borrowing money on a stamp duty account. It is a tax collected by stamps used in official documents, closed on contract books or documents, and the Revenue Department will take responsibility. Necessary related documents may include matters concerning the lease of land, the employment of goods, the proxy, and the lease of property. It is usually attached at the back of the contract with the legal form to complete the contract.

Specific business tax and others

There are some differences between businesses, even though taxes collected from sales or service businesses may seem to be the same tax, but they actually have different details. There might be 4 categories of tax to pay and  also special business taxes for real estate businesses. 

Specific business taxes are subject to specialized banking services, such as banking, finance, securities foncier, life insurance, and pawnshops. Including commercial banks such as loan guarantees, currency exchange, bills of exchange, or fintech start-ups. The tax filing is in P.E. 40 will have to pay a total of 3.3% of the local tax rate and submit it within 15 days of the next month. 

Other types of taxes should be understood, such as property taxes which are 12.5% per year, a tax on the collection of rent or service on property, large signage tax on different sizes and languages on signs starting at 200 baht. However, there are also tax-exempt signs filed with the district office. Including Excise taxes and other extravagant businesses that may impose penalties on people such as tobacco, liquor, etc.

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