What is withholding tax ❓ Workers should know

What is withholding tax ❓ Workers should know

One of the important business taxes and business owners should know Withholding income tax because it is a close tax. And the most basic of payments that can happen every day.

But many people may understand that Must issue a withholding certificate or a 50 bis certificate for supporting purposes only. Or maybe try to understand this tax thoroughly. until it became even more incomprehensible

In fact, business owners like us is the one who knows best money in - money out What is a list, what type, pays to whom? Do you know that knowing the basics is just this? You already understand the principle of withholding.

Especially if it's about taxes that are deducted from that employee's salary. The aforementioned basics can be used as well.

Today we will invite you to try to understand about withholding tax on salary. When paying salaries to employees What should I know?

🔹What is withholding tax?

Withholding tax is a type of tax that is deducted every time a payment is made in accordance with the terms that the tax covers. The person who pays the money must deduct from the amount to be paid to the payee. and take that money to the state The recipient party receives the money in full. along with documents "Withholding certificate" as evidence when doing tax deduction

The IRS states that withholding taxes are meant to reduce the burden on taxpayers. So you won't have to pay a lot of taxes at the end of the year, and on the other hand, it's a tax that gives more money to the state. Because many payees are not interested in asking for this type of tax refund.

🔹 Elements of withholding tax

Usually, if your business is a legal entity, such as a corporation or limited partnership. will have a duty to withhold tax as a payer already But to know how much to deduct with how many percentage deduction must come to understand a little more that Who is the business paying to, for what, and when?

1. Who pays?

To see if this income must be taxed or not. Let's see from the recipient first who it is.

Who to pay is important enough to let a business owner like you know that If I have to issue a withholding slip and submit taxes to the Revenue Department, what form should I use?

Basically, each payment of a business If divided by type of people who receive money, it will be divided into 3 groups: people who are employees. The rest is to see how the business pays the individual. or juristic person

Each type of business may employ different employees. Some businesses employ only permanent employees. Some businesses do not have permanent employees. but occasionally hire freelancers Or perhaps it might be outsource to hire another company to do the work for you instead.

For ease of understanding the main points of this article, FlowAccount will focus on full-time employees.

2. What do you pay for?

Once you know the payment to the employee, then see what kind of money the expense is.

Usually, the cost of purchasing goods/services will be deducted from the withholding tax. Salary is also considered an expense that fits in this meaning as well.

But may have to look at that in more detail Business owners are paid in addition to their salary. and welfare for employees or not If there is, it must be taken to calculate withholding tax as well.

3. When do you pay?

When a business owner knows that Taxes must be deducted from the money paid to employees. Now may have to look at Which group of employees do we take care of? according to the form of employment and pay

- One-time or temporary employment, such as hiring freelancers to work for Hiring and paying this form It is a one-time deduction at the payment of wages.

- Employment and continuous payment such as salary or daily hire These types of employment and payments are taxed on a progressive basis.

🔹Who has to pay withholding tax to the IRS?

Payer is the person responsible for deducting from the money paid and sending it to the Revenue Department. Many people may think that the payer is referring to the company. or juristic person only but in fact Individuals can also pay this type of tax. Depends on what the money we pay is paid for.

🔹When do I have to deduct?

We have to pay this tax when paying more than 1,000 baht at one time. or several times together For example, if we divide the payment of freelancers 1,000 baht 2 times, 500 baht each time, then we have to deduct tax both times. because the total amount is more than 1,000 baht

🔹What are the expenses that need to be done withholding?

1. Shipping costs every time there is a sale and transportation Where the company or legal entity providing the service must be registered as a carrier, 1% withholding is required. If you are not yet registered as a legal entity, no deduction is required. But the post office is not subject to withholding because it is an exempt agency.

2. Advertising costs Hiring to post advertisements to help brands or products be known through print media. or social media channels that is not a marketing service with a 2% withholding; the marketing service is Hiring a Blogger to Review Product Ads Hire a marketing consultant for marketing, must deduct 3%

3. Wages for contractors or services Service charges incurred in all businesses must be withholding at 3%, such as hire services. Hire a photographer to take pictures. Hire a product review blogger. hire interior Location services, telephone, internet also fall into this category. because it is considered a service

4. Real estate rental people who do not have a place of their own If renting a place to hold a seminar Or hold a temporary event is a service fee. Withholding 3%, but if you hold the key, it will be considered as rental of the premises. 5% withholding from the landlord. There are also other expenses. Another thing that has to be deducted 5%, such as car rentals, actors' wages and prize money from various contests or sweepstakes

🔹What are the exemptions for withholding tax?

For small amounts that are less than 1,000 baht, the Revenue Department stipulates that no withholding tax is required, but amounts that are less than 1,000 baht have an ongoing contract, such as monthly phone service charges. Internet service fees, etc. must be withheld tax because the annual balance exceeds 1,000 baht.

I hope that this information will be useful to many people. Importantly, I want everyone to pay attention to study tax. because these things are very close At least know that you won't make mistakes when it comes time to file your taxes. Feel at ease and not be afraid to pay fines

-------------------------------------------------------------------------------------

Details of online marketing services

>> https://www.chatstickmarket.com/langran

Examples of various brands that we take care of online marketing

>>https://www.chatstickmarket.com/portfolio

---------------------------------------------------------------------------------------

💙 Consult our team 💙

📱Tel : 0840104252 📱0947805680

Office Hotline : 034-900-165 , 02-297-0811 (Monday-Friday)

📨 Inbox : http://m.me/ChatStick.TH

┏━━━━━━━━━┓

📲 LINE: @chatstick