Withholding tax

[lelapin]

I have just been charged a small withholding tax by Bangkok Bank from my Saving account. As I thought I received no interest on this account why am I being charged tax. Also I had advised them of my tax number at the start of the year so why am I charged any tax anyway.

[lopburi3]

There is a small interest paid on normal savings account in June and December each year.  Believe they started the withholding about a year or so ago (before was done on fixed deposits).  This can be claimed back if not due.

[topt]

1 hour ago, lelapin said:

I have just been charged a small withholding tax by Bangkok Bank from my Saving account. As I thought I received no interest on this account why am I being charged tax

If you have a debit charge for tax do you not have another credit entry for interest? I have never had one without the other. If not I would go and ask.

Normally they are next to each other but could depend on the account and timing.

[tiocfaidh]

I agree with topt and the only other charge that comes out of my Bangkok bank account is an annual ATM card charge.

[lelapin]

35 minutes ago, topt said:

If you have a debit charge for tax do you not have another credit entry for interest? I have never had one without the other. If not I would go and ask.

Normally they are next to each other but could depend on the account and timing.

Yes I have found the interest payment. Thanks for your help

[Puchaiyank]

It is Thailand's way of saying: "We love you this many".

[Kerryd]

I get a withholding tax on all my accounts that receive interest payments, even if the amount paid is some ridiculously small amount like 15 baht, there is a tax on it. (I don't have a tax number and the amount is tiny so I don't worry about it.)

This has actually been going on for a few years, since at least 2011. How do I know ? 

Last year I went in to update the bank book on an account I opened in 2009 and hadn't touched since then. I'd put 5,000 baht in it and left it.
The update only went back to 2011 though.
4 entries per year.
Interest payment.
Withholding tax.
Interest payment.
Withholding tax.

I see the interest rate dropped in 2014. I had been getting about 16.67 baht in interest (June 2012) which dropped to 15.73 (Dec). The tax was .17 in June and .16 in Dec.
For the last couple of years, the interest payments were around 9.6 baht every 6 months and the tax was .10 each time.

The good news is, that account sat dormant from 2009 to 2019 and all I had to do to get the money was go to a branch with my passport and bankbook (always take your passport when going to the bank for any reason). They reactivated the account (took a day) and the next day I was able to take the money out.

In the 10 years that 5,000 baht was in the account, it had accumulated a massive 177 baht in (net) interest ! Naturally I rushed to the nearest lottery seller to buy tickets that ended in 177 and 77. (I didn't - and those numbers didn't come up in the next draw either.)

Then I rushed to the local Som Tam seller to splurge on some BBQ chicken and khao niow to go with the Som Tam ! Happy day indeed ! (I didn't - I took the 5k from the account and left the interest in there. Eventually the balance will hit zero and then they will close the account automatically.)

[Max69xl]

19 hours ago, lopburi3 said:

There is a small interest paid on normal savings account in June and December each year.  Believe they started the withholding about a year or so ago (before was done on fixed deposits).  This can be claimed back if not due.

You earn interest for every type of account incl.saving accounts. The interest,like you saud, is paid twice a year, in June and December. Then you pay tax on the interest. This is nothing new and I guess OP didn't see the deposit, just the withdrawn tax. He didn't even know that a simple savings account earns interest. 

Edited June 29, 2020 by Max69xl

[rwill]

About a year ago they started withholding 15% tax on interest paid.  The first 20K in interest is exempt from tax and Thai citizens don't have anything withheld on it.  But for foreigners they decided to withhold anyway.  I imagine their reasoning is that most won't take the time to file taxes and get it returned.  I have read on the forums that if you have a tax ID you can show it to the bank and they will stop withholding on the first 20K of interest.

[lelapin]

35 minutes ago, rwill said:

About a year ago they started withholding 15% tax on interest paid.  The first 20K in interest is exempt from tax and Thai citizens don't have anything withheld on it.  But for foreigners they decided to withhold anyway.  I imagine their reasoning is that most won't take the time to file taxes and get it returned.  I have read on the forums that if you have a tax ID you can show it to the bank and they will stop withholding on the first 20K of interest.

I successfully claimed back my tax last year and gave my tax ID to the bank after reading on here that it would ensure that the bank would stop withholding my tax this year. Well although the amount is small they have still withheld tax on my savings account in June. I intend to query this with the bank next month.

[crazykopite]

You pay tax on interest earned ive just paid just under 300 baht this June normally you would see interest earned and directly under that should show the tax deducted 

[Pib]

In mid 2019 the govt started withholding 15% withholding tax on "regular" savings accts even for interest earned that is Bt20K or less per year unless you have your Thai tax ID number onfile with your bank.  Since for a Thai their Thai ID card 13 digit number is also their Thai tax ID number they automatically had it onfile and no tax withholding is applied on interest earned per year of "Bt20K or less."  

 

For farangs who do not have Thai ID cards to avoid the withholding tax on their regular savings accts they need to provide their Thai tax 13 digit ID number to their bank.   They can get a tax ID number issued at their local tax revenue office.  Most farangs probably choose to do this when apply for a withholding tax refund each year during the normal tax filing period of Jan-Mar...but you can get a tax ID issued earlier if desired especially if you need to provide it to a bank "now" to stop a withholding.

 

However, when earning "over" Bt20K interest per year the tax withholding on regular savings accts is applied regardless of being Thai or farang and/or having your tax ID onfile with the bank.  Once going over Bt20K interest earned per year on a regular savings acct the Thai govt takes a tax withholding....even if Thai.

 

Additionally, when a farang has a joint acct with a Thai (typically a married couple) just because the Thai spouse already had their Thai ID number onfile with the bank that will not stop the withholding since the bank will key-in on the farang joint owner....if the farang joint owner don't have their Thai tax ID onfile then the joint acct has the 15% tax withholding applied. 

 

The 15% tax withholding on "fixed" saving accts has been a long time rule for "Thai or farang" and for "any" amount of interest earned per year....even for amounts less that Bt20K interest per year.

 

In mid 2019 I provided my Thai tax ID number to Bangkok Bank and Krungsri Bank where I have multiple regular savings accts and they immediately stopped the withholding on all those accts.

 

[Pib]

36 minutes ago, lelapin said:

I successfully claimed back my tax last year and gave my tax ID to the bank after reading on here that it would ensure that the bank would stop withholding my tax this year. Well although the amount is small they have still withheld tax on my savings account in June. I intend to query this with the bank next month.

For whatever reason your bank didn't follow-through in properly coding your acct assuming your are talking a "non-fixed" type savings acct...what I will call a regular savings acct....and assuming you didn't earn more than Bt20K interest.  

 

Now on a "fixed-type" savings acct the 15% tax withholding is generally automatic regardless of amount of interest earned, whether you are Thai or farang, and regardless of having your Thai tax ID number onfile with the bank.

 

[WorriedNoodle]

14 minutes ago, Pib said:

they need to provide their Thai tax 13 digit ID number to their bank. 

Thanks for info.

 

I have only ever worked here and paid tax about 9 years ago. I have a tax document with a number on it in format n-nnnn-nnnn-n which is 13 digits if you count the dashes? Is this what I need to show my bank? Is is still valid having last worked here 9 years ago paying working tax and now retired but getting wht on my bank balance used for retirement stay?

 

Thanks.

[Pib]

19 minutes ago, WorriedNoodle said:

Thanks for info.

 

I have only ever worked here and paid tax about 9 years ago. I have a tax document with a number on it in format n-nnnn-nnnn-n which is 13 digits if you count the dashes? Is this what I need to show my bank? Is is still valid having last worked here 9 years ago paying working tax and now retired but getting wht on my bank balance used for retirement stay?

 

Thanks.

In early 2012 they switched from a 10 digit number to 13 digit number.  Maybe visit your local revenue office and ask for a new one.  

 

https://msnagroup.com/new-thai-tax-id-number/

[khunPer]

22 hours ago, lelapin said:

As I thought I received no interest on this account why am I being charged tax. Also I had advised them of my tax number at the start of the year so why am I charged any tax anyway.

It's a withholding tax that everybody pay. If you have a personal income tax number and make the yearly tax return form, you just include the income and the withheld tax there, and it will be adjusted in the total income tax you might be due to pay; or returned, if your paid taxes are too high, or your income is below the tax limit.

 

You can also decide to do nothing, then the withheld tax is final, no matter if you have a tax number and fulfill the annual tax return form or not.

 

If the withheld tax is a (very) minor amount, just forget, it might "cost" more to adjust it, or claim it back...????

[IAMHERE]

On 6/28/2020 at 3:08 AM, lopburi3 said:

This can be claimed back if not due.

Would anyone be able to write up how we go about 'claimed back' works; how to do ?

[IAMHERE]

Yes, 276 baht tax on 1842 interest at Bangkok Bank where I keep the 800,000 for retirement extension. So 552 total (estimation) every year as a donation towards the greater good of Thailand. I dislike it but how much bother should I go thru to get that 552 baht returned ?

[Pib]

12 minutes ago, IAMHERE said:

Would anyone be able to write up how we go about 'claimed back' works; how to do ?

In early Jan of each year go to the bank that applied the withholding tax and ask for the withholding letter where they state how much was withheld.  Only takes them around 15 minutes to generate it for you.

 

Take that letter and your body to your local income tax filing office during the Jan-Mar tax return/refund filing period each year and tell them you want to apply for a refund of bank interest withheld. The office will help you complete/submit the forms.   Then wait x-amount of weeks for the refund to arrive.   Or you can do it online, but I always did it by visiting my local tax office.

 

 See below thread from 2013 that has posts on the process up to Jan 2020.