Thailand's Ministerial Regulation No. 402 was published in the Royal Gazette on 9 October: for seven categories of income, including service fees, rent and advertising fees, paid between 1 January 2026 and 31 December 2027, the withholding tax rate is a flat 1% where the payer files and remits the tax electronically, down from 5%, 3% or 2%.
What the New Rule Changes
Ministerial Regulation No. 402 (B.E. 2569) was signed by the Minister of Finance on 1 October 2026 and published in the Royal Gazette on 9 October (Vol. 143, Part 63 Kor). It repeals the original wording of item (17/5), Clause 2 of Ministerial Regulation No. 144 (B.E. 2522) and replaces it with a new provision: for the payments listed below made between 1 January 2026 and 31 December 2027, where the payer files and remits the withholding tax electronically under Section 3 quindecies of the Revenue Code, the withholding tax rate is 1.0%.
An infographic posted on the Revenue Department's homepage on 15 October states that the rate for the applicable income has been reduced from 5%, 3% and 2% to 1%. Enquiries: hotline 1161.
Which Payments Qualify
The regulation lists seven categories of income:
Income under Section 40(2) (such as service fees and commissions) paid to a company or juristic partnership;
Goodwill, copyright or other right fees under Section 40(3) paid to a company or juristic partnership;
Rent under Section 40(5)(a) paid to an individual or a corporate income taxpayer (excluding charter fees for vessels used in international carriage under the Merchant Marine Promotion Act);
Income under Section 40(6) and (7), i.e. income from liberal professions and contract work;
Prizes from contests, competitions, lucky draws and similar activities;
Performance fees paid to individual public entertainers resident in Thailand;
Fees for hire of work, sales promotion prizes or discounts, advertising fees and other service fees (excluding hotel service fees, restaurant service fees and life insurance premiums).
Most categories do not apply where the recipient is a foundation or association that earns income from business operations, or one designated by the Minister of Finance under Section 47(7)(b).
Why the Change Was Made
The explanatory note to the regulation states that, for certain types of income, payers who use electronic tax payment and make payments within the specified period are entitled to rates lower than those under Ministerial Regulation No. 144, with the aim of encouraging businesses to pay tax through electronic systems.
Note that the applicable period starts on 1 January 2026, while the regulation was only published in October. The regulation does not say how payments already withheld at other rates earlier this year should be treated; subsequent Revenue Department announcements will govern.
Key Points
Ministerial Regulation No. 402 was published in the Royal Gazette on 9 October 2026 and applies to payments made from 1 January 2026 to 31 December 2027.
The payer must file and remit electronically (e-Withholding Tax); the 1% rate does not apply to paper filings.
Seven categories of income are covered, including service fees, rent, advertising fees, contract work payments and performance fees; the previous rates of 5%, 3% and 2% fall to 1%.
Hotel service fees, restaurant service fees and life insurance premiums fall outside the seventh category.
The treatment of tax already withheld this year is subject to Revenue Department announcements.
Z&X Insight
The 1% rate applies only to electronic tax payment. Businesses should first confirm whether their bank has enabled electronic payment of withholding tax, then review the nature of each payment under their supplier contracts category by category: for the same service fee, electronic and paper filing carry different withholding rates, and the withholding tax certificates issued will differ accordingly. Z&X Accounting & Tax Outsourcing Services handle monthly bookkeeping and tax filing, and can help businesses sort payment categories and adjust their withholding filing method, with each filing confirmed by the client before submission.
Sources
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