Withholding tax paid on Kasikorn Bank interest - Why?

[DiDiChok]

I am British and Interest on my Kasikorn bank saving account (held since 2008 with ATM card) is received around 22nd of June and December every year.  About two days ago the interest arrived but on the next line of the statement is a withdrawal for "Withholding tax".  THis has never happened before.  Having checked with two UK farang friends, their accounts have been debited similarly.

 

I haven't seen anything in the news about this and it still says on Kaikorn's web pages that interest under ฿20,000 is tax free.  Can anybody shed some light on this new practice?

[dabhand]

Looks like you need to contact your bank to sort it out.

 

https://forum.thaivisa.com/topic/1098835-banks-to-automatically-submit-savings-accounts-interest-data-to-rd-interest-less-than-20000-baht-exempted-from-tax/

[DiDiChok]

Thank you for your valued words of wisdom.  Kasikorn Bank replied in Tinglish as follows:

 

Referring to your enquiry about the withholding tax payable, we would like to provide you with the information you have enquired: In case a savings account, the person who receive total interest earned from all savings account and all bank (except for Government Savings Bank and Bank for Agriculture and Agricultural Cooperatives) more than 20,000 Baht, the withholding tax payable will be deducted from an interest earned from deposits at 15%.

 

Moreover, if the person who request no send the information of savings account interest to The Revenue Department, the withholding tax payable will be deducted from an interest earned from deposits at 15%. If the total interest is not over than 20,000 Baht, they can submit a tax refund.

 

I suppose I'll have to get the tax note from the Bank and discuss it with the tax office. That would be an interesting and fun thing to try to do.  Maybe the "no send" bit is the cause of the problem.  Has nobody else any thoughts on the matter?

[Pib]

It appears K-bank's reply does not explain why you had tax withheld since your are earning far, far less than Bt20K interest per year.   My guess is it's going to turn out to be how your tax status is coded in the K-bank system in terms of whether you are coded as a "foreigner and resident" vs a "Thai and resident" and whether you have Thai tax ID on file with K-bank.  

 

See below Krungsri Bank related thread for more info...be sure to read the whole thread vs just the post below link opens to.

 

b

[DiDiChok]

Thank you so much for pointing me to that advice.  For me now, it's off to the Revenue office to get a card with the taxpayer reference code on.  Although it's only small ฿ in interest at the moment & not worth worrying about, when I keep the ฿800,000 or more in there it'll start to be significant and worthwhile claiming back.  I suppose the Govenment will make a bit of money from those who can't be bothered or don't understand what's going on.

[piewarmer]

If you use a crypto exchange in Thailand there is also a withholding tax

Edited June 30, 2019 by piewarmer

[bravo19]

I just checked my savings account at BKK Bank and saw i had to pay witholding tax on my semiannual interest although my interest are much less than 20000 baht. Is there a new law to pay tax?


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[DiDiChok]

From now on, if you haven't recorded your Thai taxpayer number with the Bank and are not a Thai national they'll just take the money.  Up to you to get it back if you want it back because you don't earn enough from Thailand to pay Thai tax.

[Briggsy]

6 minutes ago, DiDiChok said:

From now on, if you haven't recorded your Thai taxpayer number with the Bank and are not a Thai national they'll just take the money.  Up to you to get it back if you want it back because you don't earn enough from Thailand to pay Thai tax.

Absolutely correct.

 

A few years ago, I claimed back around 1100 Baht withholding account and they opened an investigation on me! I sh** my pants. They can keep the 55 Baht from my savings account this year.

Edited June 30, 2019 by Briggsy

[shady86]

I had same witholding tax deduction from my BKK bank and went to check with bank. They told me 20,000B treshold only applies to Thai national. Foreigners need to pay full amount regardless of savings interest. Can anyone confirm this?

[YT3k72Em]

It's not true. but getting them to understand that will be a difficult. They haven't been trained on what to do or how handle foreigners with a Tax ID. Even the call center doesn't know. 

[Pib]

3 hours ago, shady86 said:

I had same witholding tax deduction from my BKK bank and went to check with bank. They told me 20,000B treshold only applies to Thai national. Foreigners need to pay full amount regardless of savings interest. Can anyone confirm this?

It is now true under the new Thai revenue dept rule that went in effect around Apr/May 2019. 

 

If you are coded in the bank's system as a "Thai citizen and a resident" there is no automatic withholding on Bt20K or less interest earned; but go above Bt20K interest earned on a regular savings account and 15% withholding tax on interest earned is applied.

 

But if you are a "foreigner and a resident" the 15% tax withholding on interest earned is automatic on any amount earned...whether above or below Bt20K interest per year, UNLESS, you have your Thai tax ID number on file with the bank.  With your Thai tax ID number onfile there is no tax withholding on a regular savings account if earning Bt20K or less interest per year...but you are taxed above Bt20K interest.  Basically you are now treated just as if your were a Thai.

 

Above is per my face-to-face conversations with Krungsri Bank and Bankgok Bank where I have accounts.  Both told me the same thing.  And both have stopped the tax withholding after I provided my Thai tax ID number.  

 

 

[shady86]

3 hours ago, Pib said:

It is now true under the new Thai revenue dept rule that went in effect around Apr/May 2019. 

 

If you are coded in the bank's system as a "Thai citizen and a resident" there is no automatic withholding on Bt20K or less interest earned; but go above Bt20K interest earned on a regular savings account and 15% withholding tax on interest earned is applied.

 

But if you are a "foreigner and a resident" the 15% tax withholding on interest earned is automatic on any amount earned...whether above or below Bt20K interest per year, UNLESS, you have your Thai tax ID number on file with the bank.  With your Thai tax ID number onfile there is no tax withholding on a regular savings account if earning Bt20K or less interest per year...but you are taxed above Bt20K interest.  Basically you are now treated just as if your were a Thai.

 

Above is per my face-to-face conversations with Krungsri Bank and Bankgok Bank where I have accounts.  Both told me the same thing.  And both have stopped the tax withholding after I provided my Thai tax ID number.  

 

 

 

Thanks for the clarification. Maybe I had not informed them my tax id when opening my account.

 

I told the bank counter that I'm working and paying tax here but was told foreigners are all treated the same so I guess its the same for national park entry fees.

 

Do you think they will refund the witholding tax after I told them my tax Id? 

 

its only 250B and I dont want to take the trouble and waste time with these leeches.

[Pib]

Just now, shady86 said:

 

Thanks for the clarification. Maybe I had not informed them my tax id when opening my account.

 

I told the bank counter that I'm working and paying tax here but was told foreigners are all treated the same so I guess its the same for national park entry fees.

 

Do you think they will refund the witholding tax after I told them my tax Id? 

 

its only 250B and I dont want to take the trouble and waste time with these leeches.

Do you mean the "bank" refunding the tax....highly unlikely since they know you can file and get a refund.  Now although Bangkok Bank refunded the amount they withheld from me I think that is only because of two reasons:

 

(1) I went in immediately....the next business day after the tax withholding regarding the issue...it was only a couple hundred baht and the bank probably hadn't actually transferred it to the govt yet....had time to fix things. 

(2) the rep who had told me earlier in the month they would not withhold any interest...nothing to worry about...no need to provide my Tax ID that I was offering was sorry for giving me bad info (she had not been updated by her bosses at that time) and not accepting my tax ID when I wanted/tried to provide it earlier.....that made the issue the bank's fault.  

 

And Krungsri Bank simply said I must file with the revenue dept to recover the tax withholding. I had not visited them earlier about a possible tax withholding...they had not given me any bad info...I was unsure if it was really going to happen (but it did)...and I made my bank visit a week or so after the tax was withheld the first time....that when I gave them my tax ID.   But just as Bangkok Bank did on my second visit, Krungsri Bank took my Thai tax ID and since then no tax has been withheld on my monthly interest payment.   My Krungsri Bank account pays interest monthly whereas my Bankgok Bank accounts pay interest twice a year in Jun and Dec.   Although Bangkok Bank took my Tax ID I will not know 100% for sure they correctly update my accounts until the next interest payment in Dec.  But for my Krungsri account I know it been updated because my end of June payment did not have any tax withholding.

 

 

 

[shady86]

Just curious, you went to the branch you opened account or any other branch would do? Don't want to waste my time travelling and calling as I doubt anyone speaks English. BKK bank call center told me to contact Rev Dept directly and I doubt anyone speaks English or even bother to pickup the phone.

[Pib]

8 minutes ago, shady86 said:

Just curious, you went to the branch you opened account or any other branch would do? Don't want to waste my time travelling and calling as I doubt anyone speaks English. BKK bank call center told me to contact Rev Dept directly and I doubt anyone speaks English or even bother to pickup the phone.

Go to the branch you opened the account at.

[shady86]

Go to the branch you opened the account at.

Ah, that would cost more than the tax deducted. Will give them a call first.

[rawhod]

I too have paid 15% withholding tax on my Bangkok Bank interest for the first time at the end of June this year. I went into my branch this morning to find out why. 

After a bit of local "tooing and froing" by the staff, they called B.Bank head office.

The reply was that the 20K Baht tax exempt interest applies only to Thai customers and not to Foreign customers.

 

This seems to fit in with other peoples findings.

 

Another nice little earner for the Thai government from Johnny Foreigner who, in certain circumstances, is obliged to keep large amounts of funds in the bank in order to satisfy the Thai visa/extension requirements.

[YT3k72Em]

That's more of an excuse to get rid of you than a real reason.  The notice from BoT doesn't mention different rules for Thais and Foreigners, it simply mentions taxpayers. So in theory if you are a taxpayer and have a Tax ID you should be able stop or reclaim the deduction.

 

https://sherrings.com/interest-income-personal-tax-thailand.html

 

https://www.krungsri.com/bank/en/Other/AboutUs/krungsri-announce/exemption-tax-interest-savings-deposit.html

[shady86]

I too have paid 15% withholding tax on my Bangkok Bank interest for the first time at the end of June this year. I went into my branch this morning to find out why. 
After a bit of local "tooing and froing" by the staff, they called B.Bank head office.
The reply was that the 20K Baht tax exempt interest applies only to Thai customers and not to Foreign customers.
 
This seems to fit in with other peoples findings.
 
Another nice little earner for the Thai government from Johnny Foreigner who, in certain circumstances, is obliged to keep large amounts of funds in the bank in order to satisfy the Thai visa/extension requirements.

15% applies to all amount for foreigners unless you are tax payer in Thailand. Just bring your tax id to the branch and they will process the refund for you.

Honestly, why would you bother to keep money here with low interest rate.