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Outsourcing Payroll Services in Thailand

Transcript of the above video:

In this video today we are going to be specifically discussing payroll services. A firm like ours, we have a division specifically designed, or I guess I should say dedicated to providing accounting and corporate services. I am a tax attorney in the United States. I assist in consulting various American clients especially with respect to tax implications and activities and corporate activities happening here in Thailand from an American perspective but our Thai accounting team and the Thai accountants  work on that team, oftentimes provide accounting assistance with respect to operations here in the Kingdom.

One thing that comes up fairly frequently, that more falls sort of under the scope of corporate services rather than specifically accounting services per se, is payroll services.  So basically assistance in compiling and dispersing payrolls for given operation staff essentially these functions can often be outsourced and there are many operations that find that outsourcing is both more efficient and more cost effective when compared to having full time staff dealing with that within an entities organizational structure here. But I am bringing this up specifically to point out one thing that’s especially important, especially with SMEs and especially with respect to foreign owned SMEs or foreign controlled SMEs here in Thailand and that’s the issue of Social Security filings and how they pertain to Thai work permits. Social Security needs to be maintained on various Thai employees and sometimes foreign employees that work within a given operation here in the Kingdom and it should be noted that, when making these filings it’s extremely important that a company or an operation be very assiduous and diligent with respect to making certain that the filings are done properly because failure to file Social Security filings correctly can result in significant problems with respect to business visa extension and work permit extension or application for both.

But that being said, what I am talking about here is, as can be seen in other videos specifically on this channel with respect to work permits, generally speaking, 4 Thai employees are required in order to, a ratio of 4:1 Thai employees  to foreign employees are required under operations, generally small businesses that want to go ahead and get a work permit for a foreign employee. Failure to maintain accurate records of Social Security filings, can result in problems with respect to work permit application here because not having those records, it’s a requirement basically to have those records for work permit application for business visa extension. In the past, where small mistakes would be made, it was oftentimes possible to go and amend retroactively, documentation pertaining to Social Security associated with business visa or work permit. That era is effectively over in my opinion. Ever since the so called “good guys in, bad guys out” policy here in the Kingdom which pertained specifically to immigration, we’ve seen a lot less leniency with respect to so called back filing or amended filings associated with Social Security so having a team of professionals or professional assistants with respect to filing documentation pertaining to Social Security is really, really important I think and it is going to be increasingly important moving forward, especially for those operations where you have a foreign work permit present within the structure of the entity.