What is the difference between “individual” and “juristic person” business models?

What is the difference between “individual” and “juristic person” business models?

Before deciding to do any business, there must be a study on the business model first because it will show that What kind of business model is our business suitable for? for the greatest benefit in doing that business

📌 business model "Individual"

- Suitable for small businesses with only one owner Or an ordinary partnership (with 2 or more partners) that is not a juristic person, in other words, is not registered as a company itself.

- Taxes will be in the form personal income tax There are 3 types of tax returns:

1. P.N.D. 90

2. Por Ngor Dor 91

3. Por Ngor Dor 94

- The advantage lies in the form of decisions that can be made quickly and agilely, including manual accounting.

- The disadvantage will be in the form of Lack of credibility from financial institutions Makes the chances of getting less credit. and business owners Being solely responsible for all debts, that is, the risk of bankruptcy increases.

📌 business model "juristic person"

- Consists of juristic ordinary partnerships, limited partnerships and limited companies, which must have a company registration first.

- Taxes will be in the form corporate income tax There are 4 types of tax returns:

1. P.N.D. 50

2. P.N.D. 51

3. Por Ngor Dor 52

4. Por Ngor Dor 55

- The advantage will be in the form of credibility in business expansion which will be received from financial institutions in applying for credit And the risk of bankruptcy is less because the liability has a partner who is also responsible.

- The disadvantage will be in the form of having to wait for the approval of various matters through the resolution of the meeting which may be delayed in regards to accounting It is necessary to hire an accountant. to verify and certify the account; to submit to the Revenue Department

📌 Paying taxes

Individuals pay taxes in the form personal income tax

- The highest tax rate is 35%.

- There are 2 methods of tax calculation as follows.

Method 1: Calculate tax from net income

Net Income x Tax Rate = Tax Calculated on Net Income

The net income can be calculated from

Net Income = Assessable Income - Expenses - Allowances - Donations

Method 2 Calculate tax from assessable income

Assessable income x 0.005 = Tax calculated from assessable income

Exception: If calculated by method 2 (tax on assessable income), then the amount of assessable income With an amount not exceeding 5000 baht, pay tax according to method 1 (tax on net income).

Juristic persons pay taxes in the form of corporate income tax

- The highest tax rate is 20%.

- In case of loss, no tax is payable and the loss can be deducted from the next year's profit for a maximum of 5 years.

However, the tax payment of both forms of business can be filed for tax payment by self-filing method at Revenue offices in nearby areas or apply online at Revenue website ( https://www.rd.go.th/272.html ) If you want to learn more can be studied from Tax Guide for Entrepreneurs ( https://www.rd.go.th/62063.html ) on the Revenue website

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