Interest withholding tax

[peterfranks]

I've always been told that the exemption of the 15% withholding tax, is limited to the first 20.000 baht of received interest, cumulated over all accounts held with all banks.

 

Though I guess there must be a flaw in the system. Surprise??

 

I have a personal tax ID, but only Krungsri bank seems to be able to play by the book, and does not deduct the tax on the first 20.000 baht of interest.

 

So for 2021 I reached that limit in November, and so Krungsri did not deduct tax for the first 10 months, but did deduct once the limit was reached.

 

In the meantime I had moved some money to an SCB account, which not seem to be able to apply that automatic exemption, and have all kind of excuses for it.

 

So by the end of the year 2021, SCB had charged me a total of 2100 baht withholding tax, for which they provided the documents needed for the revenue office.

 

The revenue office just sent me the cheque for the 2100 baht withholding tax deducted by SCB.

 

To me, it seems that the revenue office is either not aware of the withholding tax, which was not deducted by Krungsri, or the 20.000 baht of interest applies per bank.

 

Any comments?

[Sophon]

They changed the rules so there is no longer a 20k Baht exemption, the banks have to withhold tax on any interest amount. However, you can avoid the withholding of tax on savings accounts (not on fixed deposits) if you show your tax id number to the bank and ask them to register it on the account.

Edited July 4, 2022 by Sophon

[peterfranks]

5 minutes ago, Sophon said:

They changed the rules so there is no longer a 20k Baht exemption, the banks have to withhold tax on any interest amount. However, you can avoid the withholding of tax on savings accounts (not on fixed deposits) if you show your tax id number to the bank and ask them to register it on the account.

Krungsri is still not deducting withholding tax on my account for the first 20.000 baht of interest.

 

But the point of my OP was actually, that Kringsri didn't deduct the tax on the first 20K of interest, and in addition to that, I received a refund of the withholding tax, deducted by SCB on about 14K of interest.

 

Edit : My account with SCB is also a savings account, but they have all kind of "invalid" excuses for deducting the tax, however they have my tax ID in the system

Edited July 4, 2022 by peterfranks

[WorriedNoodle]

2 hours ago, Sophon said:

They changed the rules so there is no longer a 20k Baht exemption, the banks have to withhold tax on any interest amount. However, you can avoid the withholding of tax on savings accounts (not on fixed deposits) if you show your tax id number to the bank and ask them to register it on the account.

Thanks for this info. About 18 months ago I took my tax ID# to KBank with the aim of avoiding WHT on my savings acc interest. Little was spoken besides "yes, yes, understand" etc when I was in the bank and I left after they took my tax ID#  information, maybe copied it, and returned it without anything from the bank documenting the fact I had shown them my tax ID# being given but just smiling/implying everything "was now Ok" and I could leave.

 

Nearly 2 years later and I notice WHT still getting deducted on my account!

 

Guess another trip to the bank is in order.

[peterfranks]

8 minutes ago, WorriedNoodle said:

Thanks for this info. About 18 months ago I took my tax ID# to KBank with the aim of avoiding WHT on my savings acc interest. Little was spoken besides "yes, yes, understand" etc when I was in the bank and I left after they took my tax ID#  information, maybe copied it, and returned it without anything from the bank documenting the fact I had shown them my tax ID# being given but just smiling/implying everything "was now Ok" and I could leave.

 

Nearly 2 years later and I notice WHT still getting deducted on my account!

 

Guess another trip to the bank is in order.

Another trip to the bank will have the same result as the first one, as they come up with so many more lame excuses.

Some of the excuses SCB used.

-- It is only for savings accounts :: sorry darling this is a normal savings account.

-- We can not do because you have accounts with other banks, and we calculated the sum  :: Sorry darling, but that is the job of the revenue department at the end of the year, since you have no knowledge of my savings with other banks. Take note, interest with SCB is paid half year, so we're talking about a week ago.

-- We can't do because you hold a foreign passport :: Sorry darling passport has nothing to do with this, it is the Thai tax ID that counts.

 

Another bank made the excuse. We can't do because our bank is from Singapore.  :: Sorry darling, every bank operating in Thailand is a Thai bank, regardless of their origin.

[peterfranks]

But the real point of my thread is not that banks refuse to play by the rules, but that for 2021 I got WHT refunded on a total of 34K baht interest, 20K automatically with Krungsri and 14K from SCB through the revenue office, where I was always told that 20K cumulated over all accounts with all banks in Thailand was the limit.

Edited July 4, 2022 by peterfranks

[WorriedNoodle]

1 hour ago, peterfranks said:

Another trip to the bank will have the same result as the first one, as they come up with so many more lame excuses.

I phoned up KBank head office today to ask why WHT was deducted from interest on my accounts since providing them my tax ID#. They said it was a revenue dept policy to now deduct WHT from all saving interest accounts so there was nothing I could do more.

 

I got the information about providing Tax ID# to bank to avoid WHT from this forum in the past, so obviously that was wrong.

[peterfranks]

4 minutes ago, WorriedNoodle said:

I phoned up KBank head office today to ask why WHT was deducted from interest on my accounts since providing them my tax ID#. They said it was a revenue dept policy to now deduct WHT from all saving interest accounts so there was nothing I could do more.

 

I got the information about providing Tax ID# to bank to avoid WHT from this forum in the past, so obviously that was wrong.

As I told you, they will make up excuses to hide their incompetence.

 

If that was indeed the policy, why has Krungsri not deducted WHT below 20K interest for the past 2 years, and is still not deducting?

 

I been to the revenue department last week because of this issue with SCB and another bank, and they even called the banks and told them that they don't need to deduct the WHT.

 

Yet the banks keep lying through their teeth

[topt]

54 minutes ago, peterfranks said:

Yet the banks keep lying through their teeth

Individual banks or staff.

I had SCB add mine last year or the one before and now interest is added but no tax taken - just checked June statement and that is what happened.

 

6 hours ago, peterfranks said:

Any comments?

The individual banks won't know what other banks you have earned interest and unlikely Thai Revenue will check individually unless you come to their attention. The same would probably happen in the west.

You are responsible for declaring it on a tax form.

 

As long as your total "income" is below I think 150k baht there is no tax to pay anyhow.

[peterfranks]

2 minutes ago, topt said:

1 hour ago, peterfranks said:

Yet the banks keep lying through their teeth

Individual banks or staff.

I had SCB add mine last year or the one before and now interest is added but no tax taken - just checked June statement and that is what happened.

I spend about 3 hours in the SCB branch in January, staff - manager and head office over the phone involved.

 

At the end I had signed a load of documents, and be assured that now the WHT tax would not be deducted anymore.

 

On 25 June the interest for the first 6 months was added to my account, and WHT deducted.

 

So I went to the revenue department and explained my issue. They told me that SCB should not deduct the tax, and the manager gave his phone number so they could contact him.

 

I then went back to the SCB branch, where I spent another 3 hours, and they called the revenue department, and head office was again involved over the phone.

 

At the end they told me that it should be OK, but they needed to locate the documents I signed in January, and would call  me the next day.

 

Next day head office called me in a conference call with the branch, and again the same drivel started. You have money in other banks, so we need to deduct blah blah blah

[gamb00ler]

@peterfranks  If you're in CM, try going to the branch where I opened my SCB EZ savings account.

The branch is in the BigC at Donchan, just North of the intersection of route 1141 and the superhighway.

On my first visit they were having trouble opening the EZ account.  I asked them if it would work better if I had a Thai tax ID and they said yes.  A couple of days later I got my tax ID and went back to that branch and got the EZ account opened.  I have never had tax deducted from the interest paid on that account.  I also successfully stopped the withholding tax at Kasikorn bank and Bangkok bank.  However, I was unable to stop withholding from my fixed deposit account at Bangkok bank.

 

Be polite but persistent and you should prevail.  If you fail you can file a tax return and the withheld funds should be refunded provided your total income is below the applicable threshold.

Edited July 4, 2022 by gamb00ler

[livram]

July 2021 I went to Krungsri  Bank Korat and presented my tax ID number and they stopped WH tax. All was good until June 2022 when they started WH tax again.  I know the 20,000 baht rule but it does not apply to me. Last week I went to Mall branch to get Bank letter for retirement visa and had to sign my name over 20 times, never had to do that before.

[peterfranks]

3 minutes ago, livram said:

July 2021 I went to Krungsri  Bank Korat and presented my tax ID number and they stopped WH tax. All was good until June 2022 when they started WH tax again. 

You made me suspicious with your comment, so I checked my Krungsri account, and indeed June withholding tax was deducted for the first time this year, and I haven't reached the 20K interest limit either.

 

5 minutes ago, livram said:

Last week I went to Mall branch to get Bank letter for retirement visa and had to sign my name over 20 times, never had to do that before.

Xenophobia setting in again?

[livram]

42 minutes ago, peterfranks said:

You made me suspicious with your comment, so I checked my Krungsri account, and indeed June withholding tax was deducted for the first time this year, and I haven't reached the 20K interest limit either.

 

Xenophobia setting in again?

No, it is just that I worked in banking for 25 years and have never seen anything like Thailand banks and their paperwork. They seem to trust no one and require so much paperwork that there is no way a supervisor will be able to check so it defeats the purpose.

[peterfranks]

2 minutes ago, livram said:

No, it is just that I worked in banking for 25 years and have never seen anything like Thailand banks and their paperwork. They seem to trust no one and require so much paperwork that there is no way a supervisor will be able to check so it defeats the purpose.

In case you misunderstood my comment, the xenophobia claim was directed at the Thai banks, not at you.

[livram]

1 minute ago, peterfranks said:

In case you misunderstood my comment, the xenophobia claim was directed at the Thai banks, not at you.

I misunderstood, my apologies.

[petermik]

On 7/4/2022 at 5:53 PM, topt said:

 

I had SCB add mine last year or the one before and now interest is added but no tax taken - just checked June statement and that is what happened.

 

 

I went along to my local TMBThanachart Bank early this year to try and get my interest paid tax free...at first they denied it was possible but after bluffing them with but Kasikorn Bank can/have done someone phoned "head office" and low and behold yes we can....took it with a pinch of salt but....low and behold after updating my passbook earlier today I see my interest added without any tax deduction......

[DrJoy]

Anyone who opened their account with their Pink ID?

Is Witholding tax deducted from your accounts as well?

 

any input will be appreciated 

[DrJoy]

On 7/4/2022 at 6:20 PM, gamb00ler said:

@peterfranks  If you're in CM, try going to the branch where I opened my SCB EZ savings account.

The branch is in the BigC at Donchan, just North of the intersection of route 1141 and the superhighway.

On my first visit they were having trouble opening the EZ account.  I asked them if it would work better if I had a Thai tax ID and they said yes.  A couple of days later I got my tax ID and went back to that branch and got the EZ account opened.  I have never had tax deducted from the interest paid on that account.  I also successfully stopped the withholding tax at Kasikorn bank and Bangkok bank.  However, I was unable to stop withholding from my fixed deposit account at Bangkok bank.

 

Be polite but persistent and you should prevail.  If you fail you can file a tax return and the withheld funds should be refunded provided your total income is below the applicable threshold.

When I opened my SCB EZ account in Bangkok, the teller herself asked for my tax id

but this june tax was deducted 

Edited July 5, 2022 by DrJoy

[gamb00ler]

1 hour ago, DrJoy said:

When I opened my SCB EZ account in Bangkok, the teller herself asked for my tax id

but this june tax was deducted 

Perhaps SCB requires the tax ID (or Thai ID) as part of the process to open the account but then another step is required to stop the tax withholding.  SCB said they couldn't open the EZ account for me without the tax ID.  Maybe I just got lucky and the SCB staff also set up my account for no withholding at the same time.

[DrJoy]

On 7/5/2022 at 8:44 PM, gamb00ler said:

Perhaps SCB requires the tax ID (or Thai ID) as part of the process to open the account but then another step is required to stop the tax withholding.  SCB said they couldn't open the EZ account for me without the tax ID.  Maybe I just got lucky and the SCB staff also set up my account for no withholding at the same time.

Thanks a ton for your advice. Finally I could stop the Witholding tax from my SCB EZ A/c ( Bangkok)

They refunded my deducted tax on the spot too. 
The customer care officer also confirmed this. 
 

[skatewash]

Just to share my recent experience with tax withholding on interest earned in savings accounts. But first, I should mention that this waiving of tax withheld on interest never applied to fixed term accounts but only regular savings accounts.

I obtained a Thai Tax ID years ago for the purpose of reclaiming my tax withheld on interest. I went to my existing  Mee Tae Dai savings account at Krungsri Bank and had the Thai Tax ID added to the registration of my account.  From that point on Krungsri Bank has never withheld taxes on my interest earned.  Interest is paid in this particular account every month and when I checked it for June 2022 I confirmed that interest was earned but tax was not withheld.

I opened a SCB EZ Savings Account using my Thai Tax ID, by which I mean that I gave my Thai Tax ID card to the clerk when I was opening the account.  It does not appear that I was successful in getting tax withheld because when I checked my statement for June 2022 I see that 15% tax was withheld on the interest earned (I am well below the 20,000 interest earned threshold).  So it does not appear that SCB was able to associate my Thai Tax ID with my EZ Savings account.  I have heard the following explanation for why this might be the case:

When a Thai opens a bank account they provide their Thai Tax ID number as the identifying number for the account.  When a non-Thai opens a bank account they typically provide their passport.  In this case the passport is the identifying number for the account.  So even if you give them your Thai Tax ID, SCB does not seem able to register this number with your account as the identifying number.  Without this connection (due to the inability to store your Thai Tax ID for a foreigner owned account) you don't qualify for the waiver of tax withholding on earned interest.  Don't know is this is true or not, but it's what I've heard.

In any event, I can confirm that as of June 2022 Krungsri Bank isn't withholding tax on my savings account but SCB is.

[DrJoy]

18 minutes ago, skatewash said:

Just to share my recent experience with tax withholding on interest earned in savings accounts. But first, I should mention that this waiving of tax withheld on interest never applied to fixed term accounts but only regular savings accounts.

I obtained a Thai Tax ID years ago for the purpose of reclaiming my tax withheld on interest. I went to my existing  Mee Tae Dai savings account at Krungsri Bank and had the Thai Tax ID added to the registration of my account.  From that point on Krungsri Bank has never withheld taxes on my interest earned.  Interest is paid in this particular account every month and when I checked it for June 2022 I confirmed that interest was earned but tax was not withheld.

I opened a SCB EZ Savings Account using my Thai Tax ID, by which I mean that I gave my Thai Tax ID card to the clerk when I was opening the account.  It does not appear that I was successful in getting tax withheld because when I checked my statement for June 2022 I see that 15% tax was withheld on the interest earned (I am well below the 20,000 interest earned threshold).  So it does not appear that SCB was able to associate my Thai Tax ID with my EZ Savings account.  I have heard the following explanation for why this might be the case:

When a Thai opens a bank account they provide their Thai Tax ID number as the identifying number for the account.  When a non-Thai opens a bank account they typically provide their passport.  In this case the passport is the identifying number for the account.  So even if you give them your Thai Tax ID, SCB does not seem able to register this number with your account as the identifying number.  Without this connection (due to the inability to store your Thai Tax ID for a foreigner owned account) you don't qualify for the waiver of tax withholding on earned interest.  Don't know is this is true or not, but it's what I've heard.

In any event, I can confirm that as of June 2022 Krungsri Bank isn't withholding tax on my savings account but SCB is.

On @gamb00ler advice, i went to my branch today(Bkk) 

They instantly refunded all my tax and put my tax id on their records.

 

They let my wife see the computer screen with my tax id reflecting in their software as evidence.

 

I called their customer care to double check and it was confirmed by the phone officer as well.

[peterfranks]

19 minutes ago, DrJoy said:

On @gamb00ler advice, i went to my branch today(Bkk) 

They instantly refunded all my tax and put my tax id on their records.

 

They let my wife see the computer screen with my tax id reflecting in their software as evidence.

 

I called their customer care to double check and it was confirmed by the phone officer as well.

When I opened my account I was told the same.

 

In June withholding tax was deducted, and when they printed out the documents to apply for the refund at the revenue office, it had the tax idea printed on the documents, so it is in the software.

 

The excuses I have heard since, as to why it can be deducted, are astonishing.

[skatewash]

55 minutes ago, skatewash said:

Just to share my recent experience with tax withholding on interest earned in savings accounts. But first, I should mention that this waiving of tax withheld on interest never applied to fixed term accounts but only regular savings accounts.

I obtained a Thai Tax ID years ago for the purpose of reclaiming my tax withheld on interest. I went to my existing  Mee Tae Dai savings account at Krungsri Bank and had the Thai Tax ID added to the registration of my account.  From that point on Krungsri Bank has never withheld taxes on my interest earned.  Interest is paid in this particular account every month and when I checked it for June 2022 I confirmed that interest was earned but tax was not withheld.

I opened a SCB EZ Savings Account using my Thai Tax ID, by which I mean that I gave my Thai Tax ID card to the clerk when I was opening the account.  It does not appear that I was successful in getting tax withheld because when I checked my statement for June 2022 I see that 15% tax was withheld on the interest earned (I am well below the 20,000 interest earned threshold).  So it does not appear that SCB was able to associate my Thai Tax ID with my EZ Savings account.  I have heard the following explanation for why this might be the case:

When a Thai opens a bank account they provide their Thai Tax ID number as the identifying number for the account.  When a non-Thai opens a bank account they typically provide their passport.  In this case the passport is the identifying number for the account.  So even if you give them your Thai Tax ID, SCB does not seem able to register this number with your account as the identifying number.  Without this connection (due to the inability to store your Thai Tax ID for a foreigner owned account) you don't qualify for the waiver of tax withholding on earned interest.  Don't know is this is true or not, but it's what I've heard.

In any event, I can confirm that as of June 2022 Krungsri Bank isn't withholding tax on my savings account but SCB is.

Also, I had the Thai Tax ID added to my Bangkok Bank Savings Account and in June 2022 interest was earned but no tax withheld. 

So, to recap, waiving the tax withheld on interest seems to work for Bangkok Bank and Krungsri Bank, but not SCB.

 

[DrJoy]

11 minutes ago, peterfranks said:

When I opened my account I was told the same.

 

In June withholding tax was deducted, and when they printed out the documents to apply for the refund at the revenue office, it had the tax idea printed on the documents, so it is in the software.

 

The excuses I have heard since, as to why it can be deducted, are astonishing.

Peter,  The branch refunded all my tax not the revenue department, 

coz  I don't want it to be withheld in the first place. 
 

[peterfranks]

38 minutes ago, DrJoy said:

Peter,  The branch refunded all my tax not the revenue department, 

coz  I don't want it to be withheld in the first place. 
 

You were lucky, I not so much. They said refunding was not an option

[peterfranks]

45 minutes ago, skatewash said:

Also, I had the Thai Tax ID added to my Bangkok Bank Savings Account and in June 2022 interest was earned but no tax withheld. 

So, to recap, waiving the tax withheld on interest seems to work for Bangkok Bank and Krungsri Bank, but not SCB.

 

I had WHT tax not deducted for 2 years with Krungsri, for the month of June it was deducted, though I still far from the limit.

[DrJoy]

3 hours ago, skatewash said:

Just to share my recent experience with tax withholding on interest earned in savings accounts. But first, I should mention that this waiving of tax withheld on interest never applied to fixed term accounts but only regular savings accounts.

I obtained a Thai Tax ID years ago for the purpose of reclaiming my tax withheld on interest. I went to my existing  Mee Tae Dai savings account at Krungsri Bank and had the Thai Tax ID added to the registration of my account.  From that point on Krungsri Bank has never withheld taxes on my interest earned.  Interest is paid in this particular account every month and when I checked it for June 2022 I confirmed that interest was earned but tax was not withheld.

I opened a SCB EZ Savings Account using my Thai Tax ID, by which I mean that I gave my Thai Tax ID card to the clerk when I was opening the account.  It does not appear that I was successful in getting tax withheld because when I checked my statement for June 2022 I see that 15% tax was withheld on the interest earned (I am well below the 20,000 interest earned threshold).  So it does not appear that SCB was able to associate my Thai Tax ID with my EZ Savings account.  I have heard the following explanation for why this might be the case:

When a Thai opens a bank account they provide their Thai Tax ID number as the identifying number for the account.  When a non-Thai opens a bank account they typically provide their passport.  In this case the passport is the identifying number for the account.  So even if you give them your Thai Tax ID, SCB does not seem able to register this number with your account as the identifying number.  Without this connection (due to the inability to store your Thai Tax ID for a foreigner owned account) you don't qualify for the waiver of tax withholding on earned interest.  Don't know is this is true or not, but it's what I've heard.

In any event, I can confirm that as of June 2022 Krungsri Bank isn't withholding tax on my savings account but SCB is.

I suspect you may be correct but I just updated my 3 yr olds K bank passbook(Half Thai)

Guess what , no tax withheld on the interest. 
 

I don't know when he applied for a tax id at the revenue????

 

All this is pure discrimination, nothing else
 

Edited July 17, 2022 by DrJoy

[gamb00ler]

2 hours ago, DrJoy said:

All this is pure discrimination, nothing else

It's discrimination based on possession of an ID number that the Thai Revenue Dept. can use to identify and tax the income recipient.  Thai citizens use their Thai ID #, foreigners can use their pink ID card number or a Tax ID issued by the Revenue Dept.

 

The two other countries that I've lived in before have similar withholding policies based on much the same qualifications.  In the US if you don't have a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) people who pay you money (W-2, W-2G, 1099-Misc, etc) are supposed to withhold a percentage and remit to the US gov't.

 

You're still subject to withholding because the bank employees are lazy or untrained or overly concerned about seeming incompetent.... or perhaps all of the above.

Edited July 17, 2022 by gamb00ler