Introduction
With the rise of remote work and the increasing demand for cross-border talent, Thailand has become a favored destination for international companies looking to build and scale remote teams. Offering a blend of skilled professionals, a cost-effective labor market, and strong infrastructure, Thailand is particularly attractive to startups, SMEs, and multinationals alike.
However, managing payments for remote teams in Thailand requires a clear understanding of local labor laws, tax regulations, and international employment strategies. Whether you’re hiring full-time employees, contractors, or building a hybrid workforce, this guide explores the best methods for paying remote teams in Thailand, focusing on three primary options: Employer of Record (EOR), traditional payroll, and contractor arrangements.
Understanding the Thai Employment Landscape
Before choosing a payment method, it’s important to understand the local employment context:
- Labor Protections: Thai labor law provides strong protections to employees, including minimum wage requirements, severance pay, paid leave, and social security contributions.
- Tax Obligations: Employers must withhold income taxes and contribute to the Social Security Fund.
- Work Permits for Foreigners: Hiring non-Thai nationals requires specific work permit and visa arrangements.
3 Options: EOR, Payroll & Contractor
Option 1: Employer of Record (EOR) in Thailand
An Employer of Record is a third-party service that acts as the legal employer of your remote team. The EOR handles all administrative and legal responsibilities, allowing you to manage the employees’ day-to-day tasks.
How EOR Works?
- Your company identifies and manages the talent.
- The EOR legally employs the worker on your behalf.
- The EOR takes care of payroll, benefits, tax filings, and compliance.
✅ Pros:
- No need to establish a Thai legal entity.
- Fast and compliant hiring process.
- Full legal employment with statutory benefits.
- Ideal for testing market entry or managing small teams.
❌ Cons:
- Higher ongoing service fees.
- Less direct control over HR processes.
Best For:
- Companies entering the Thai market for the first time.
- Businesses needing to scale quickly and compliantly.
- Remote-first companies hiring across multiple countries.
Option 2: Traditional Payroll Through a Local Entity
Setting up a local entity in Thailand enables you to directly hire and pay employees via your own company payroll.
Key Requirements
- Register a Thai business entity (limited company, BOI-certified, etc.).
- Open a local bank account.
- Hire a local accountant or HR professional.
- File monthly tax and social security reports.
✅ Pros:
- Full control over employment contracts and HR policies.
- Ability to build a permanent physical presence in Thailand.
- Opportunity to benefit from BOI (Board of Investment) incentives.
❌ Cons:
- Time-consuming and costly setup process.
- Regulatory complexity, especially around taxes and visas.
- Requires in-house compliance knowledge.
Best For:
- Companies committed to long-term expansion in Thailand.
- Enterprises planning to hire a large team or open offices.
- Businesses with existing experience in foreign market setup.
Option 3: Paying Independent Contractors in Thailand
Hiring freelancers or independent contractors is another popular route for flexible and project-based work.
How It Works?
- Contractors issue invoices for their services.
- Payments are made via international transfer (e.g., Wise, Payoneer).
- The contractor is responsible for their own taxes and social security.
✅ Pros:
- No legal entity or EOR required.
- Lower cost compared to full-time employment.
- Ideal for short-term or specialized projects.
❌ Cons:
- Thai law doesn’t clearly distinguish between employees and contractors.
- Misclassification risks: workers may be entitled to employee benefits.
- No control over tax compliance by the contractor.
Best For:
- Startups hiring short-term talent.
- Businesses testing the Thai labor market.
- Non-core roles or project-based work.
Key Considerations When Choosing a Payment Method
1. Business Objectives
Are you testing the market or planning long-term growth?
2. Team Size
Fewer than 5 employees? EOR or contractors might be ideal.
3. Control vs. Simplicity
Do you prefer operational control or administrative ease?
4. Risk Tolerance
Are you ready to navigate Thai labor law and tax filings?
5. Budget
Compare ongoing service fees, setup costs, and compliance expenses.
Tools & Partners That Can Help
To make remote team payments smoother, consider working with service providers and platforms like:
- Aster Lion: Thailand-based EOR and business compliance partner.
- Deel: EOR and contractor payments in 150+ countries including Thailand.
- Multiplier: EOR + global payroll automation.
- Gusto: Global payroll software for companies with international teams.
Compliance & Legal Tips
- Always issue compliant contracts whether hiring employees or contractors.
- Maintain records of payroll, taxes, and employee benefits.
- Ensure foreign hires have appropriate work permits.
- Classify roles correctly to avoid misclassification risks.
- File monthly and annual employer tax reports as required.
Conclusion
Paying remote teams in Thailand can be seamless and efficient with the right approach. EOR services offer speed and compliance, traditional payroll ensures full control, while contractor arrangements provide flexibility. Each method comes with trade-offs in cost, legal complexity, and operational burden.
Choosing the right option depends on your business goals, team structure, and appetite for managing regulatory obligations. By partnering with the right service providers and staying informed on Thai labor laws, foreign companies can build reliable, compliant, and thriving remote teams in Thailand.
Whether you’re hiring your first Thai employee or expanding an existing team, make sure your payroll strategy supports growth, agility, and compliance every step of the way.
Looking to hire in Thailand?
Aster Lion offers comprehensive EOR and payroll services tailored to international companies expanding into Thailand.
Contact us to learn how we can simplify your hiring process.