By Bhavana Kumar

In light of the Coronavirus Disease (COVID-19) crisis, there are several changes being made around the world and in the Kingdom of Thailand to assist taxpayers. On 30 March 2020, Ministerial Regulation Number 361 was announced and published by the Thai government to reduce Thai withholding tax rates on certain types of payments.

Withholding tax is being reduced from 3% to 1.5% for the period between 1st April 2020 – 30th September 2020 as a part of Covid-19 relief measures. It was also announced that the withholding tax will be further reduced to 2% from 1st October 2020 to 31st December 2021 if the payments are made via the e-Withholding Tax system.

The type of payments that the 1.5% withholding tax is applicable to are listed below:-

  • income from rendering services, such as brokerage fees or commissions
  • income from goodwill, copyrights, franchises, patents or other rights
  • income from liberal arts professions, such as law, engineering, or architecture
  • income from a contract of work whereby the contractor provides essential materials besides tools
  • remuneration for hire of work, prizes, discounts, or other benefits due to sales promotions and other services. However, there are some exclusions and they are as follows: - 
    • remuneration for public entertainers
    • income from advertisements
    • income from premiums for non-life insurance
    • income from transport charges

Should you require any further information or assistance regarding the contents of this issue, please do not hesitate to contact one of RSM Thailand’s Accounting and Tax Consultants or email us on [email protected]