Payroll Parking in Thailand: How It Works, What It Costs and When to Use It

Payroll parking in Thailand means employing your people through a licensed Thai company that acts as their Employer of Record (EOR), while they work for you day to day. The EOR signs the Thai-language employment contract, registers the employee with the Social Security Office, withholds and files personal income tax on form PND.1, carries the severance obligations under the Labour Protection Act and, for foreign staff, sponsors the work permit. You direct the work, set the targets and run the performance reviews.

The model is well established in Bangkok because Thailand makes direct employment by a foreign company unusually hard. The Foreign Business Act caps most service businesses at 49% foreign ownership without a licence or Board of Investment promotion, and a Thai company needs THB 2 million of registered capital and four Thai employees for every foreigner it wants to hire. Payroll parking lets you hire the people first and solve the structure later, or never.

What payroll parking covers in Thailand

• An employment contract in Thai (with an English version for you) that meets the Labour Protection Act: the 48-hour week, overtime at 1.5 times on working days and 3 times on holidays, at least six days of annual leave after a year, 13 or more public holidays and a probation period, normally set at 119 days
• Registration with the Social Security Office and monthly contributions of 5% employer and 5% employee, on the new wage ceiling of THB 17,500 that took effect on 1 January 2026 (maximum THB 875 a month each, up from THB 750)
• Monthly withholding of personal income tax on PND.1, filed by the 7th of the following month or the 15th online, on progressive rates from 0% to 35%
• Provident fund contributions where you choose to offer one, which most competitive Bangkok employers do
• Leave, medical insurance, claims and payslips through an employee self-service portal
• Work permit sponsorship for expatriates, using the EOR’s own registered capital and Thai headcount to satisfy the THB 2 million and 4 to 1 rules
• Termination handled to the Act, including the statutory severance scale of 30 to 400 days’ wages by length of service, which has no cap and applies to almost any employer-initiated ending

How the arrangement is set up

1. Scope and agreement. Roles, salaries, allowances, work location and reporting lines are agreed, and a service agreement fixes fees and responsibilities.
2. Onboarding. The EOR collects the employee’s ID card or passport, house registration, bank and tax details, issues the Thai contract, and registers them for Social Security within 30 days of the start date.
3. Monthly cycle. You confirm variable pay, overtime and leave by a cut-off. The EOR pays salaries, remits Social Security by the 15th and PND.1 tax, and sends one consolidated invoice.
4. Year end. The EOR files PND.1 Kor and issues each employee their 50 Tawi withholding certificate for their own return.
5. Exit or transfer. When your own Thai company or BOI-promoted entity is ready, staff transfer with service continuity; if a role ends, the EOR manages notice and severance correctly.

What payroll parking costs in Thailand

Fees are usually a fixed monthly amount per employee or a percentage of gross pay, with salary and statutory costs passed through. Thailand’s statutory on-costs are modest by regional standards: Social Security is capped at THB 875 a month per employee, so the real cost drivers are provident fund contributions, medical insurance and, above all, severance exposure, which a good EOR will price into the arrangement rather than leave as a surprise.

The comparison is the fully loaded cost of a Thai company: legal structuring to hold control under the Foreign Business Act, THB 2 million of registered capital per foreign hire, a Thai accountant and payroll officer, and management time. For teams of under fifteen to twenty people, parking is usually cheaper and always faster.

When payroll parking is the right answer in Thailand

• Hiring before you have a licensed structure. You want a country manager and sales team in Bangkok now, while the Foreign Business Licence or BOI application runs its course.
• Small permanent teams. A regional company with three or four people in Thailand may never justify a Thai subsidiary.
• Expatriate hires without the arithmetic. The EOR’s capital and Thai headcount carry the work permit ratios, so one foreign specialist does not require you to hire four Thai staff first.
• Project work in the EEC. Implementation teams in Chonburi or Rayong can be employed on fixed-term contracts and released cleanly.
• One regional payroll. Companies with staff in Thailand, Singapore, Malaysia, Vietnam and Indonesia often park all five payrolls with one provider for a single monthly cycle.

When it is not

If you plan to build a factory or a large service centre, or need a Thai entity to hold licences, contracts or BOI incentives in your own name, set up the entity early and treat parking as the bridge. Parking does not dilute the employee’s rights under the Labour Protection Act either; the severance scale and the 48-hour week apply whoever the employer of record is.

Payroll parking with People Profilers Thailand

People Profilers has provided payroll parking and Employer of Record services in Thailand for more than twenty years, from our Bangkok office and alongside our teams in Singapore, Malaysia, Vietnam and Indonesia. Employees are parked under our Thai headcount, paid through our cloud payroll platform with self-service payslips, leave and claims, and kept compliant with Social Security, PND.1 and the Labour Protection Act as the rules change.

See our EOR and payroll parking services in Thailand and payroll outsourcing in Thailand, or talk to People Profilers Thailand.