Dogmatix

Amazon and Ebay and some couriers have been operating a system whereby Thai taxes are collected in advance which means that items can be delivered to your door. The taxes are described as deposits and you could be charged more or get a refund. On the rare occasions I have used this service, I have been charged more than the actual Thai import duty and VAT but not got refunds. Others have told me they have received refunds from the Amazon service though. Both Amazon and Ebay have never distinguished items valued at less than 1,500 baht and charged Thai tax on them anyway which was not refunded. I guess the way to go for Aliexpress and for items drop shipped from Lazarda and Shopee from China to Thailand will be to do something similar but only charge VAT below 1,500 which is easier because the rate is a universal 7%, whereas import duty varies from 5% to 40%. There should also be a system to pay VAT online for packages sent by individual senders or those too small to get into this type of sender. But introducing it through a bureaucratic order, bypassing parliament without any of this in place and without worrying about the volume of packages on which the cost to collect it will be more than the VAT is undemocratic, shameful and stupid - all hallmarks of this latest Thaksin government.

And will cause inflation and chaos with no benefit to anyone.

Packages not exempted by the current regulation are taxed on the landed cost value. That means import duty applied to the landed cost which includes insurance and freight. Then VAT is applied to that. Some items like wine also have excise duty and municipal tax applied before the VAT. But VAT has always applied to imports of goods in Thailand ever since it was introduced. If you import products that are manufacturing inputs or you re-export the whole thing. as you say, you can claim the Thai VAT charged at import back. But you cannot claim back any foreign taxes and I doubt China charges VAT on exports anyway.

The coup government tried to do this but shelved the bill. It was revived by the Prayut government but they dropped the cancellation of this exemption, presumably because it was viewed as impractical and costly to implement relative to the amount of VAT, given the large volume of really low value items flowing in from China. At least one can say that the Prayut government put things like this through the democratic parliamentary process with public consultation according to the constitution. This latest Thaksin government rules by decrees put out by bureaucrats, like the foreign remittance tax. Thaksin has always liked to rule by decree and just do things without any planning and preparation and let the system figure it out. An example is his 30 baht healthcare introduced with no planning on the funding. It made the government hospitals technically bankrupt, so they had to be bailed out by the government, while it was later determined under the Sarayudh government, after Thaksin got booted in the coup, that the cost of collecting the 30 baht was more than 30 baht. So it became free. I assume this will be totally chaotic with huge backlogs created to collect tiny amounts of tax per package. Right now you have to go to a post office and stand in long queues to pay taxes on overseas packages over 1,500 and they open every single one over 1,500 too. Anything that looks a bit out of the ordinary and may need an unobtainable import licence, like herbal supplements, you have to pick up from the postal customs at Laksi in Bangkok. I assume there are some provincial offices but probably only in provincial capitals. Often they have no clue what needs an import licence and have to go off and ask someone. But technically all supplements need an import licence. So this could destroy iHerb's large Thai business which comprises many supplements unavailable in Thailand. So the business may just be destroyed rather than going to Thai middlemen. The whole argument about introducing fairness for Thai middlemen that want to sell the same products marked up is obviously complete BS and I am sure they don't even believe that story themselves but don't want to tell the truth that they are trying to grab as much tax as possible and don't care if it costs more to collect it than the tax or that it will be inflationary. If Thais can buy the items direct from China with VAT added by no mark up from a Thai middleman, that is, of course, what they will do. But what is actually happening is that Thai and Chinese middlemen operating in Thailand are taking orders from Thais without keeping any stock themselves. When they get an order, they get the several huge Chinese stockists to drop ship individual packages direct to the Thai customers. Since import duties are still exempted under 1,500, this system will continue. Thai middlemen don't want to keep stock and, if they imported in bulk, they would have to pay both import duty and VAT. So still more expensive than shipping direct from China. Even though this has been talked about since the coup government bill planned to introduce it in 2016 or so, it is still and as unthought through as can be and is likely to cause chaos. If they have to do it, far better to announce that planning is in progress to make it viable and set u a system of online payment, so that goods can still be delivered by postmen without causing chaos at post offices and backlogs. They should also just accept the declarations of most of the low value packages without opening them up, as they do now. Opening an addition 1 million + small packages a month is going to require additional staffing and space and is not worth the cost.

The exemption from import duties and VAT has only ever applied to things coming by post. Things coming by courier never had any exemption.

The Customs Dept order has not yet been posted in the Royal Gazette.

I read something in Thai a few weeks ago that said that taxpayers in areas not covered by an RD branch or sub branch and wishing to deal with RD officers face to face should go to their district office but I can't remember where that was. I assume there are a handful of RD officers stationed in these district offices but have never encountered them. Fiscal responsibilities upcountry are otherwise with the thesabans and thesaban tambons which cover areas that are not the same as tambons that are subdivisions of the amphurs. Land and buildings tax is collected by the thesabans and the dividing lines are totally arbitrary. I have two pieces of land in a medium sized town upcountry that are contiguous, in the same condition of unsuccessfully trying to grow bananas and in the same amphur, with the same Treasury Dept appraisal prices but are in two separate thesabans that collect Land and Buildings Tax at different rates, based on their view of whether the land is utilised or vacant. That gives an idea of how whacky and inconsistent tax assessment can be upcountry. Given no regulations or guidelines on the remittance tax, zero understanding of DTAs or anything "foreign" and limited command of English, there is no reason to assume that assessment of remittance tax will be any less whacky or less inconsistent upcountry that Land and Buildings tax.

I am not an expert on the UK's non-dom rules, which are LIFO ++ or modified LIFO. HMRC demands that in remitting funds to the UK, a non-dom must prioritise the funds that will incur the greatest UK tax liability first. Roughly speaking and simplifying it the priority of types of funds would be something like this" 1. Foreign source income - foreign tax unpaid. 2. Foreign source cap gains - foreign tax unpaid. 3. Foreign source income - foreign tax paid. 4. Foreign cap gains - foreign tax paid. 5. Capital that is non-taxable in the UK. Unsurprisingly they want to rig things so that they collect as much tax as possible. In the UK cap gains are subject to a lower maximum rate of tax and are filed separately, so they don't push you into a higher tax bracket like they do in Thailand. In Thailand it will be mainly foreign cap gains that will cause a problem because there are special arrangements for individuals for cap gains from SET listed stocks )exempt) and property (taxed according a complex set of rules but not lumped in with regular income. Since there are not regulations in Thailand, I wouldn't be surprised, if the RD will start insisting that the income taxable in Thailand at the highest rate is deemed to have been remitted. That will mean them demanding information on all sources of income in the account, so they can assess the correct priority of remittances. In lieu of government certified documents in a format that is similar to what exists in Thailand that RD officers can understand, the line of least resistance will be to ask the taxpayer to submit it all and we will decided later, resulting in a decision to tax the whole lot without approving any tax credits.

Khun Lavaron the DG of the RG who issued order P. 161/2566 just before being transferred is now elevated to permanent secretary at the finance ministry. He has now announced that he will be getting rid of the exemption from VAT on small packages under 1,500 baht imported by post. Because it will take too long to do this using the normal democratic process of amending the customs law in parliament, he will order the Customs Dept DG to issue an order to short circuit the democratic process. The Postal Customs department has no plans for how it will open and assess for tax an additional 15 million small packages a year, many of which are low cost items from China costing less than 100 baht. The current system involves not delivering taxable packages but summoning recipients to post offices and often to the Postal Customs office in Laksi,, Bangkok, for clarification, even for quite common items like musical instrument accessories like reeds. Often they challenge declarations and look up online to see if they can find a similar item selling for more than the declaration and use that value instead. It seems like this order introduced with no planning will create total chaos at post offices and cause huge backlogs. Without doubt the cost of collecting under 7 baht in VAT on the packages under 100 baht will cost more to collect than the tax raised, just like the 30 baht medical charge had to be scrapped because it cost more than 30 baht to collect. At the very least, they should set up a way to pay online and let the packages be delivered by the postmen as normal. They could just asses the items under 1,500 without opening them. But they have no online system and probably will want to open everything to check it is properly declared. It seems like there is a patern with this government and Khun Lavaron in particlar. Rule by decree to avoid parliamentary scrutiny and public consultation. Introduce measures that require detailed planning without any planning or preparation, will likely cost more to administer than revenue collected and will cause chaos. The same is true of the same official's plan to tax remittances. They have no plans of preparation for a far more complex issue than taxing international packages. But under the new Thaksin regime, the bureaucrats need to show they are getting things done. No problem if the systems to implement it takes years to put in place or it turns out to be net money loser. The purpose of this post is not to generate replies about the postal tax (there is another thread for that) but to show that the new system in taxation is not introduce new taxes without thinking it through or caring what chaos it causes.

There is yet another method, I think used in the UK for remittance tax on non-doms' remittance of income. Income is remitted first, then capital. For example you have 100k and earned 50K in capital gains and dividends in a tax year. You want to remit 20k declaring it as 18k tax exempt principal and 2k taxable income. No dice. HMRC requires you to remit all the 50k taxable income before you can remit the tax free principal. So First out income, last out principal FOILOP may be the new Thai accounting standard when they get around to it.

It occurs to me that I have two Thai staff at my company earning 15k a month each who have never filed tax returns in their lives. One of them has been with me for about 15 years and will have several years worth of 2,000 baht fines and interest to pay, if she is ever tracked down for one of those 10 year audits. Our accountant has always said their was no need for them file because they have no tax to pay. Perhaps I need to check she is still of this opinion.

At least the linked document from the RD says documents to show tax paid overseas can be in English or Thai but, since this is a PR release, and not an order to RD officers, they may choose to demand certified translations to Thai, notarised by the MOFA anyway. They say ominously that tax documents certified by the foreign government are "recommended" which no doubt means obligatory in many RD offices. Actually demanding government certified documents will save the officers a lot of trouble, given that most Western countries will not supply them. A perfect solution for RD officers.

Seems like Srettha's days are numbered but Thaksin might keep until after the digital wallet, so he can take the hit, if there is a legal backlash. Thaksin eager to get his daughter in, so he now longer has to deal through a nominee. Money can buy anything in Thailand.

For interest my company was audited by the RD going back four years, despite having filed all tax returns on time. They are restricted to going back 2 years for companies and individuals who have filed proper tax returns but that can be extended, if they think the taxpayer might have intentionally evaded tax. In my case it appeared they gave themselves the right to do this without any ceremony or explanation and trying to refuse them would only make them more determined to dig. The RC doesn't say anything about how far they can go back for individuals or entities that don't file tax returns, So the statute of limitations in the Civil & Commercial Code of 10 years applies in this case. But, if you didn't file because you had no taxable income over the threshold after deductions, they are not going to find much in a 10 year audit, even if you had been tax resident that long. The worst case would be 2,000 baht fines for those years and I think the requirement to file tax without having taxable income has been in place for less than 10 years which would mean you could only be fined for the years after it was introduced. With the large backlogs the inspectors have and the low revenue potential of such an audit, you can decide for yourselves how likely it might be.

Anyone who wants a TIN and is refused one face to face should ask the official to put that in writing or film him or her saying that.

The provision for tax filing for singles is 60k of income, other than income from employment, and 120k income from employment, including employment income from pensions. But what is unclear here is whether state pensions are included in this. There are no Thai state pensions and this form of income is not mentioned anywhere in the RC. So are state pensions income from employment? Not really because they are not paid by employers. Are they derived from employment? Yes indirectly because most countries only pay them to retired workers who generally have to pay contributions. Perhaps an issue to be decided by the Tax Court. Whether they are considered income from employment has a bearing not only on whether they are taxable at all but on whether the 100K allowance for income from employment is applicable to them If you have income over 120k or 60k, depending on the type of income, but no taxable income and you want to be 100% compliant with the letter of the RC, by all means get a TIN, if your tax office will give you one, and go ahead and file a tax return. In deciding this and/or calculating tax, it is up to you whether you decide that remitted state pension income is income from employment, income from investment, or not assessable income at all because it is not mentioned in the RC. Personally I would not bother to file for the time being, if my remitted income is below the tax threshold. That provision is not enforced on Thais and it is unlikely it will be enforced on foreigners at this time. The situation with expat tax returns will be highly chaotic and there will widespread non-compliance with the reinterpretation from both Thais and foreigners, largely because confusion due to the RD's refusal to publish any clarifying guidelines. So the idea that the RD is going to start trying to track down foreigners who remitted peanuts into the Kingdom to fine them 2,000, when they don't do this with Thais, is preposterous.

60k of income is the point where single people have to file tax returns. The 2,000 fine for not doing so is fact because it is in the RC. But there is no record that I know of anyone being fined for not filing when no tax was due. It is a relatively recent amendment that many or most low income earners don't know about. The policy was to try to get more people who do their own business filing, so that when they later hit taxable income, it will be automatic for the RD. I don't think it has been very successful and the policy is virtually unenforceable because they know there would a huge backlash, like when the government sued an impoverished old woman for the refund of her 600 a month old age allowance that she wasn't entitled to because she was drawing a miniscule army pension because her son was killed in the army by an explosion caused by an NCO's negligence. I think many expats who earn less that the taxable amount will be very daunted by filing tax returns and won't bother and I can't blame them. I doubt that they will be pursued by the RD and fined. In future, however, it is possible that Immigration will link up the RD and demand tax returns for visa renewal but there has been no talk of that yet.

I have done this once manually with a hard copy form which was a monstrous PITA and about half a dozen times online which is relatively simple with all the tax computation done for you. To do online you need to register in the TSD (SET share registry) portal. Once you have done that you will be able to access copies of all your dividend certificates, assuming your Thai broker has registered you properly with them properly from their side (not a given - a couple of my accounts were not registered properly with TSD because they got my name wrong, so there was no match with the TSD data). Once you get into your account at the TSD portal, there is a place where you are asked to give permission for them to send your dividend data to the RD. You fill in tax return form PND90 and click on the menu to complete the section for Section 40.4.b (40.4. ข) dividend income. There will be an option to click on for your dividend data at TSD to be transmitted directed. Click on it all your dividends will suddenly show like magic in your tax return with the corporate tax rates and you tax credit and tax rebate will be calculated. There are a few listed companies that refuse to use TSD as their registrar, notable some of the REITs. For those you have to fill in the data manually. Your Thai accountant can do all this for you. They can apply for an online tax account and the TSD account. Mobile numbers and OTPs are needed to set them up. I don't think TSD sends OTPs after you have set it up. The RD does but you can changed the phone number after setting it up. You can in fact let your accountant set it up using their own phone number. I do it for the missus who set up both accounts with her own phone number. I changed that to my own number for her own tax account and the TSD didn't send OTPs to get into her TSD account. The RD didn't object the same phone number was linked to my account. I find it worthwhile to claim the dividend tax credits because I get rebates of more that the amount of tax that was withheld but it depends on your income and deductions. I invest the maximum permitted in an LTF which gives me a 500k deduction that helps. Many people are unaware of the fact that anyone with assessable income is eligible for the LTF deduction. You don't have to be in employment but the asset management firms generally refuse to accept Americans as clients because they don't want to be bothered with FATCA.

They got this the wrong way round. Short term tourists cannot get the refund of the tax withheld because they are unable to get a TIN. Thais and foreigners with TINs can get the tax refunded. There is a space on the tax return form to declare interest income and, if had a TIN already, you could have filed a tax return by yourself and claimed the tax back within consulting any tax masters. You can also avoid having the tax withheld by signing the consent form described in my above post. The 3 provincial tax masters must have misunderstood that you wanted claim VAT rebates on shopping.

Actually there is a section of the RC that says you are entitled to receive interest from banks with the 15% withholding tax deducted, if you are willing to sign a consent form to allow the bank to automatically report details of your interest received the RD. If you receive a total of more than 20k in interest from all accounts in a year, you have to declare that in your tax return and they will tax you the 15%. I have never done that because I only found out about it recently. I have also never claimed back interest because savings rates have been stuck at a miserable 0.5% forever, despite lending rates being at a 20 year high and it involves going round the banks to get a certificate of tax deducted. If you own shares on the SET, the dividend tax credit is very useful, however, if you don't have too much other income, and well worth going to the effort to claim. You can get back more tax than was deducted from the dividends but Thai stocks have gone nowhere in about 7 years.

Looking at the current versions of Section 41 para 2, the para that was reinterpreted through order P, 161/2566 last September, on the RD's website, I notice that the Thai version has notes in the text saying See Order P. 161/2566 and See Order P. 162/2566 with links to the orders, so that Thai readers will understand clearly what the current state of play is as far as the RD is concerned. ผู้อยู่ในประเทศไทยมีเงินได้พึงประเมินตามมาตรา 40 ในปีภาษีที่ล่วงมาแล้วเนื่องจากหน้าที่งานหรือกิจการที่ทำในต่างประเทศ หรือเนื่องจากทรัพย์สินที่อยู่ในต่างประเทศ ต้องเสียภาษีเงินได้ตามบทบัญญัติในส่วนนี้เมื่อนำเงินได้พึงประเมินนั้นเข้ามาในประเทศไทย (ดูคำสั่งกรมสรรพากร ที่ ป.161/2566) (ดูคำสั่งกรมสรรพากร ที่ ป.162/2566) However, the English version has no notes or links and still reads. "A resident of Thailand who in the previous tax year derived assessable income under Section 40 from an employment or from business carried on abroad or from a property situated abroad shall, upon bringing such assessable income into Thailand, pay tax in accordance with the provisions of this Part." Although one accepts that its English translation is only for guidance, given that it knows that thousands of foreigners are deeply impacted by its capricious reinterpretation, it seems remarkably obtuse and unhelpful of the RD not to provide the same clarification to foreign readers that it has totally changed the meaning of the para in the same way it has done for Thai readers. It is not particularly helpful for the RD officers who will have to deal with foreigners' tax returns that the RD has not bothered to add the clarifying notes either. But this unhelpful attitude towards foreign taxpayers is probably reflective of what can be expected in next year when the first tax returns have to be done under the reinterpretation.

I now think the confusion regarding Royal Decree 743 stems from the use of the phrase "derived in the previous tax year". This must be written from the perspective of some one, for example, doing his tax return in March 2025 in respect of income earned in 2024. So that means effectively that what we would normally consider current income is tax exempt.

The posts about another fellow, who is retired and not earning in Thailand, who got a surprise RD visit in addition to my Danish friend are earlier in this thread. What I meant was that in addition to those cases involving expat pensioners there are posts in other threads about RD officers making surprise visits on farangs doing business in the wife's name, or officially visits to the wives.

Sorry no. It was quite early on but I can vouch for the guy I know personally. It was a few years ago. He is Danish and did a one year post retirement consulting gig for his former employer in Bangkok that got him into the tax net after working for them offshore for many years. A couple of years later they showed up at his house demanding to know why he hadn't continued to file tax returns. He said he was retired and living off his Danish pension which he was having sent to his Thai bank directly, rather than accumulating it and remitting in the next tax year. They asked to see his pension documents and when he said he had paid Danish tax, they asked to see evidence of that which he showed them. Then they said that was OK because the remittances had already been taxed in Denmark and went away without suggesting that he should pay the difference between Danish and Thai tax. The next year they came back again asking the same questions. He is an irascible bloke and told his daughter to tell them the situation was the same as on their previous visit without offering them any documents. Then he told her to give them 1,000 baht to go away and never come back. They took the cash and waied politely, left without demanding any documents and never came back. That is how he told it to me and I have no reason to believe he lied. RD officers can and do visit people in their homes unannounced. I have seen posts in other AN threads from people reporting surprise RD home visits in Phuket regarding tax on business they were doing in the Thai wife's name. One of my concerns is that, although it is unlikely to be official policy, RD inspectors, who have a lot of authority, may go rogue and visit farang pensioners in their homes to shake them down for pin money. Officers in most big cities have plenty of other fish to fry but this seems more likely in resort areas and rural areas where farangs stand out like sore thumbs. With no official guidelines on how to interpret DTAs or what documentation is needed for tax credits individual officers may apply some exaggerated interpretations and expect bribes to go away. Foreigners are more vulnerable because they tend not to have connections and generally don't know the law. plus are fearful of criminal convictions that might affect visa renewals. The way the RD is applying this non-law is an open invitation to extortion and corruption.

The RD English versions are only for guidance and they sometimes add nuances that are not there in the original in order to try to make them read better in English. In the case of Section 56 the Thai phrase that is translated as "taxpayer" is บุคคล which just means "person", not "taxpayer". A good example of why you need to be able read Thai and make the effort to look at the original to opine on this stuff. Nearly all the farang tax advisors are illiterate in Thai and just read translations and/or rely on unreliable Thai staff and often jump to conclusions that are completely wrong. It is also important to be able to search for case studies in Thai.