Tax on Thai investment income / gains

[Badger18]

This has to have come up before but I'm not finding anything. If I become resident in Thailand and invest in shares or index funds, how are the gains / any dividends or other income taxed? I'm talking about Thai tax here, obviously.

[aldriglikvid]

https://www.set.or.th/en/market/information/tax

[Badger18]

1 hour ago, aldriglikvid said:

https://www.set.or.th/en/market/information/tax

Thanks. So for a UK national capital gains are exempt subject to conditions, but the site doesn't say what thise conditions are. I'll have to see what I can find out about the double tax treaty.

[wordchild]

Thai Tax Law does not make a distinction between Capital Gain and Income from Investments, it all counts as Income and can be subject to Thai Tax. 

The exemption from Thai tax (other than the withholding tax, if applicable)   is a concession that applies only to investments made on the SET (ie Thai stocks) and certain other kinds of investments. eg it does not apply to investments made on overseas stock markets. 

The OP does not say where he intends to hold  his investments , in Thailand or another country. This is very relevant regarding his tax treatment.

If one intends to invest outside Thailand then the best thing to do is to maintain an investment account outside the country and then only bring in the income (and any gains) after Jan 1st each year. This should avoid any issues with Thai Tax.

A number of the major Thai brokers are also prepared to set up Overseas Investment Accounts for Thais and foreigners based in Thailand; these accounts are structured so that the investments are held by custodians outside Thailand and investors in these accounts are recommended to only repatriate funds in the following tax year, ie so no tax is applicable.

The issue with these accounts is that they are (usually) more expensive to operate than an equivalent brokerage account set up with ,say, a Singapore or HK broker.

 

Edited May 7, 2023 by wordchild

[Badger18]

7 hours ago, wordchild said:

Thai Tax Law does not make a distinction between Capital Gain and Income from Investments, it all counts as Income and can be subject to Thai Tax. 

If one intends to invest outside Thailand then the best thing to do is to maintain an investment account outside the country and then only bring in the income (and any gains) after Jan 1st each year. This should avoid any issues with Thai Tax.

A number of the major Thai brokers are also prepared to set up Overseas Investment Accounts for Thais and foreigners based in Thailand; these accounts are structured so that the investments are held by custodians outside Thailand and investors in these accounts are recommended to only repatriate funds in the following tax year, ie so no tax is applicable.

The issue with these accounts is that they are (usually) more expensive to operate than an equivalent brokerage account set up with ,say, a Singapore or HK broker.

 

Thanks. So if I am understanding correctly it would just be a case of finding a platform that lets me open an account on the basis that I'm resident in Thailand but is not itself based in Thailand. Then income can be tax free provided it is not brought in in the same year.

 

It seems a bit strange that the income would be treated as arising wherever the broker / platform is located is even if the stocks themselves are listed in a different jurisdiction, but I guess it's simpler that way.

[wordchild]

1 hour ago, Badger18 said:

Thanks. So if I am understanding correctly it would just be a case of finding a platform that lets me open an account on the basis that I'm resident in Thailand but is not itself based in Thailand. Then income can be tax free provided it is not brought in in the same year.

 

It seems a bit strange that the income would be treated as arising wherever the broker / platform is located is even if the stocks themselves are listed in a different jurisdiction, but I guess it's simpler that way.

yes, more or less, that is it.

Its not that the non-Thai investment income is "treated" in any particular way because of the specifics  of  where it is from.

It is just , simply , that it does not count as THAI  income. So , as far as Thai Tax is concerned,  it is not assessable for (THAI)  Income Tax.

As long as it is NOT brought into the country, in the same year as it was earned, It falls outside their definition of Income.

 

It may seem strange but it  has similarities   with   the UK's  tax treatment of UK resident non-doms. Lines of  separation between what is defined as  Income and Capital need to be drawn somewhere.

It is just that Thailand (unlike the UK) extends this "applicable Income"  definition  (and therefore benefit)  to all Thai residents,  including its own citizens. 

 

Edited May 7, 2023 by wordchild