Understand What to Do About Withholding Tax in Accounting

Understand What to Do About Withholding Tax in Accounting

Did you know that your company also needs to declare withholding tax? Among the various tax and accounting obligations of a business, one is the Withholding Income Tax Statement, which must be filed annually.

The purpose of this statement is to show income paid or credited by individuals and corporations for which Withholding Income Tax has been withheld. You can consult with our withholding tax Thailand experts for your company.

Therefore, this is one more obligation that your company must fulfill to keep up with the tax authorities. That’s why we’ve brought you all the guidelines you need to know about withholding income tax. Check it out now:

What is withholding income tax?

Contrary to popular belief, it is not a tax payment – it is just a statement made by the paying source. It shows all income that was levied in the previous calendar year on withholding income tax.

In practice, it refers to tax discounted directly by the paying source. When a company pays employees salary, for example, the discount is already deducted.

With the statement information in hand, the tax department can cross-reference it with other data and confirm its consistency. For example, depending on the worker’s income and expenses, filed on the annual withholding income tax return, he may have a refund of the withholding tax amounts or have more taxes to pay.

What information does withholding tax statement declare?

The statement serves to inform the revenue:

  • Income paid to individuals, including exempt and non-taxable income under the conditions specified by law;
  • The amount of income tax and / or withholding contributions from income paid or credited to its beneficiaries;
  • Payment, credit, delivery, employment or remittance to residents or domiciled abroad, even if no tax has been withheld, including in cases of exemption or zero rate;
  • Payments to health care plan – corporate collective.