Employee Bonus Payments — How They Affect Taxes

Year-end is the time for profit calculation and bonus payments.
For employees, this is additional income; for companies, it is a tool to reduce taxable profit.

Let’s review an example.

Initial Data

Employee salary: 35,000 THB per month
Annual income: 420,000 THB

Applied deductions:

standard deduction: 100,000 THB
personal allowance: 60,000 THB

Taxable income:
420,000 − 100,000 − 60,000 = 260,000 THB

Annual personal income tax: 5,500 THB
Monthly withholding: ~460 THB

If there is no other income, no additional tax is due at year-end.

Scenario with a Bonus

In December, the employee receives a bonus: 100,000 THB

Annual income: 520,000 THB

Taxable income:
520,000 − 100,000 − 60,000 = 360,000 THB

Annual personal income tax: 13,500 THB
Already withheld: 5,500 THB

Additional payment upon filing: 8,000 THB
(if tax on the bonus was not withheld at the time of payment)

Key Considerations

For the Employee

a bonus increases the taxable income
may move income into a higher tax bracket
often results in additional tax payable at year-end

For the Employer

Bonuses:

increase company expenses
reduce corporate income tax

However:

personal income tax must be correctly calculated and withheld
payments must be properly reported

Conclusion

A bonus is not only an incentive but also a taxable event.

It is important to:

consider the employee’s tax burden in advance
correctly withhold tax at the time of payment
plan payments taking into account annual income

Practical Recommendation

Structure all payments — salaries, bonuses, and service fees — through company accounts.
This reduces tax risks and simplifies reporting.