For many, August 2021 may have been a normal month. But for those who are already active in the online marketing industry, last August was a very hot and cold month when Facebook prepared for all Facebook Ads users to pay online advertising tax from date. From September 1, 2021 onwards, it will be charged as VAT 7% or simply said,
from now on, if you plan to make advertising costs with Facebook, you must also calculate the tax. which in some cases or some accounts The increase in taxes also increases the cost of advertising. which if any entrepreneur or advertising shooter does not know the root cause Or not sure how this Facebook tax came? And how to prepare
for tax filing? Today, we would like to explain and summarize every issue for everyone to understand easily.
Clear to understand! Where does the online advertising tax come from?
Of course, when Facebook tax comes up, many people may have 2 main questions: How does Facebook pay tax in Thailand? And advertising on other platforms will be taxed the same? We would like to split the answer into 2 issues as follows: How does
Facebook pay tax in Thailand?
Indeed, the reason Facebook made such an announcement was due to ‘Announcement of the e-Service Law’ that has been approved since 2020. This e-Service Law was created to be a tax law in the form of VAT to businesses that provide various types of electronic services. such as downloading various types of goods and services such as
music, movies, advertising materials and many others. However, the e-Service law also states that Businesses subject to this tax only need to have income from service in Thailand that exceeds 1.8 million baht per year only. which if this The Facebook
advertising platform itself is taxable. And there will also be a new change in Facebook ad spend in 2021.
Do advertising costs on other platforms include VAT?
As mentioned above, in terms of e-service laws, of course, other platforms such as Google, Line, TikTok, Netflix and other platforms that offer downloading and advertising media services will also be subject to online advertising tax in respect of This is also the case by collecting VAT in this section. In the case of Facebook, the system will charge
Facebook ads that do not include tax, but VAT will be charged separately from the advertising budget. The increase in taxes is like increasing the cost of advertising. Including entrepreneurs very much. In addition, the tax charge will also appear on all
accounts of advertising. Or open a new account to advertise, it is not possible to avoid this tax.
Check tax types before paying online advertising taxes.
Paying for online advertising taxes requires a thorough understanding of the differences and details of each type of tax. The tax may be affected by the tax in Thailand that Facebook will have 2 categories:
1. Value Added Tax or VAT
many may think. The tax increase will increase ad campaign costs by 7% and change the cost of 2021 Facebook ads. If any online advertiser has filed Por. 36 regularly or is a business that has registered VAT and has already filed Por. 36, they will not have to
pay additional online advertising tax. Because these accounts are already taxed to the state.
But in addition to paying taxes on a regular basis, we would also like to ask all advertisers to consider deduction before filing taxes. in general There are two types of deduction for tax filing expenses for VAT: fixed deduction and actual expense deduction. If it is a package, the additional expenses cannot be deducted from taxes.
However, if it is a deduction on actual expenses, it can be deducted when calculating tax only if it can be proven that these expenses are real and that ‘our name’ is required as the purchaser. Advertise with
than VAT or value added tax as described above, provides a ‘tax’ that may be related to online advertising as well, therefore, to consider and prepare the sides. We also need to understand these types of taxes.
Corporate income tax is a tax specified by the Revenue Code for companies or juristic entities to pay tax. This is usually calculated from the total net profit incurred for 12 months. Certain types of expenses can also be deducted in corporate income tax calculations. These expenses must be expenses related to the business. and have evidence that the ‘company name’ is correct and clear
then when this How does corporate income tax relate to taxes on Facebook or other platforms? or juristic person We can provide proof of advertising to Facebook or other platforms as ‘company name’ expenses as proof of corporate income tax calculation.
How do I file this tax?
Once you understand the types of taxes that may be associated with online advertising taxes, Now let’s look at the process of preparing tax filings for Facebook and different platforms. We would like to make a detailed list for everyone to understand easily as follows:
1. Check the companies that advertise well.
If we use advertising services with companies registered to operate in Thailand We can request a full tax invoice to file a tax return. But if we buy or use advertising services with foreign companies We will have to pay VAT on behalf of the company we use the service with. which after paying online advertising tax in this section on behalf of
foreign companies We can also apply for a tax refund in this section with the Revenue Department.
2. Prepare documents for submission of P.P. 36.
when reading up to this point Many people may think that paying Facebook tax and advertising tax is nonsense, but we reiterate that it is important to fill out Phor Por 36 and pay taxes according to the law. Because in addition to not risking a retrospective
review, filing Phor Por 36 also helps us get some tax refunds. The process of filing P.P. 36 for tax refund is as follows:
1. Receipt or proof of payment that is ‘our name’ or ‘company name’, which is named in this section. Varies according to the type of tax.
2. Form Phor Por 36 which can be downloaded from the website of the Revenue Department.
Procedure for filling out
1. Fill out the tax remittance information The information in this section will be our information and our business.
2. Complete the payment information for purchases of goods and services and specify ‘advertising costs’.
3. Fill in VAT based on the formula.
Finally, we hope that this information will help all business owners and online advertisers understand the online advertising tax and Facebook taxes and platforms. Make sure to keep this information. It is used to help our business adapt despite the changing circumstances.