Pursuant to the local Thailand tax laws, the income of a public entertainer is subject to personal income tax in Thailand.
A foreign public entertainer who performs in Thailand is required to file a personal income tax return and pay Thailand personal income tax on the income earned for the performance, including any income that may be paid outside of Thailand for the performance and any benefits that the promoter in Thailand may provide to the public entertainer for the performance in Thailand, such as transportation and accommodation costs.
A foreign public entertainer is also required to obtain a tax clearance certificate from the Revenue Department prior to his or her departure from Thailand.
In the case where a public entertainer acts or performs in a group or as a team, the income received (even if received individually) shall be included in a “body of persons” personal income tax return, and the manager of the group or team has the duty and responsibility to file the income tax return and pay the personal income tax for the group or team as a “body”. Where however, a public entertainer in a group or a team is individually hired, each individually hired person is required to file a separate personal income tax return.
For the computation of the tax payable in Thailand, the public entertainer is allowed expenses as follows:
1. Expenses actually incurred necessarily; or
2. Unsubstantiated expenses calculated on the basis of 60% of income up to Bt 300,000, 40% of income over Bt 300,000, whereby the total deduction shall not exceed Bt 600,000. The local Thai tax laws also impose strict withholding requirements on the promoter or the payer of income to the foreign public entertainer, whereby the payer is obliged to withhold tax according to the personal tax rates of 0-37%, depending on the level of income
Foreign public entertainers should note that none of the Agreements for the Avoidance of Double Taxation entered into between Thailand and foreign countries mitigate or reduce the imposition of personal income tax on payments made to them personally.
However, Thailand’s Double Tax Agreements with the developed OECD countries of Australia, Canada, France, Germany, Japan, UK and the US, contain an additional special provision, which prescribes that in the case where income in respect of a performance accrues not to the entertainer personally, but accrues to another person (e.g. an entertainer’s star company) then Thailand shall have taxing rights over that other person’s income.
For a star company that is established under a foreign law and carrying on business in Thailand, the local tax law requires the foreign star company to include the income in a corporate income tax return to be filed in Thailand, which income shall be subject to tax at the rate of 37% (i.e. 30% corporate income tax on profits plus 10% profits remittance tax).
However, for a star company that is established under a foreign law and not carrying on business in Thailand (which is usually the case), the local Thailand tax law does not require the foreign star company to file a tax return in Thailand, but requires the payer in Thailand to withhold 15% tax and provide the foreign company with a non-resident withholding tax certificate.
It is important, therefore, for public entertainers with star companies, which legally own or otherwise hold the legal rights to public performances, to ensure that the promoter in Thailand fully understands your legal structure and correctly applies taxes according to the prescriptions in the Double Tax Agreements.