Thai gov. to tax (remitted) income from abroad for tax residents starting 2024 - Part I

[TheAppletons]

35 minutes ago, The Cyclist said:

<SNIP>

 

All the people named above will probably tell you that the new interpretation of the rules started on the 01 Jan 2024.

 

What none of them are sure of is what exactly the new interpretation covers.

 

  One might even say that the new interpretation of the rules was proposed to start on 01 Jan 2024.  

[The Cyclist]

3 minutes ago, TheAppletons said:

 

  One might even say that the new interpretation of the rules was proposed to start on 01 Jan 2024.  

 

Interesting

 

I was late to the party and thought with the ongoing hysterics it was set in stone rather than a mere proposal.

 

Which makes everything even more funny.

[Mike Lister]

11 minutes ago, TheAppletons said:

 

  One might even say that the new interpretation of the rules was proposed to start on 01 Jan 2024.  

 

Sherrings very clearly reports that as an instruction, effective 1 January 2024, not a proposal.

 

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

[sirineou]

1 hour ago, The Cyclist said:

All the people named above will probably tell you that the new interpretation of the rules started on the 01 Jan 2024.

 

What none of them are sure of is what exactly the new interpretation covers.

Isn't that the problem?

It is actually ridiculous !! There is a law enacted and applicable seven days ago but we will know the details at a future time?  How can I make decisions in the meantime? 

Crazy!! 

[sirineou]

1 hour ago, OzzBlizz said:

Which policies are you speaking of? The ones that were in place before, but ignored for many years until now? Which ones in particular?

The provisions that expats would need to pay tax on some remittances. 

Was that always in place? If so why do we have to wait for info? If these policies were in place then there should be no problem to tell us what they are. 

[The Cyclist]

2 minutes ago, sirineou said:

There is a law enacted and applicable seven days ago but we will know the details at a future time? 

 

Do you know the difference between a new Law and a new interpretation of an existing Law ?
 

3 minutes ago, sirineou said:

How can I make decisions in the meantime? 

 

Same as you did any other day, month, year.

[freeworld]

Deleted

 

 

[jerrymahoney]

10 minutes ago, sirineou said:

The provisions that expats would need to pay tax on some remittances. 

Was that always in place? If so why do we have to wait for info? If these policies were in place then there should be no problem to tell us what they are. 

REDUX

 

According to the Revenue Department, it will seek opinions from the stakeholders affected by the new rule and issue guidelines to provide more clarity. The plan includes an amendment of the personal income tax return form to facilitate the foreign tax credit claim.

 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Thailand-Tax-Foreign-Income-Taxable-from-2024

[The Cyclist]

2 minutes ago, jerrymahoney said:

REDUX

 

According to the Revenue Department, it will seek opinions from the stakeholders affected by the new rule and issue guidelines to provide more clarity. The plan includes an amendment of the personal income tax return form to facilitate the foreign tax credit claim.

 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Thailand-Tax-Foreign-Income-Taxable-from-2024

 

Perhaps it has sought opinions from stakeholders and postponed for a couple of years, and just forgot to announce it.

 

Hence the sound of silence.

[Mike Lister]

Yet another page of drivel, just because the same poster makes it so, endlessly driving around the roundabout, looking for the very thing they're driving around. 

[jerrymahoney]

1 hour ago, sirineou said:

Isn't that the problem?

It is actually ridiculous !! There is a law enacted and applicable seven days ago but we will know the details at a future time?  How can I make decisions in the meantime? 

Crazy!! 

One of the few certain things right now is that, if you spend less than 180 days in any year in Thailand, you will owe nothing as you are not a Thai tax resident.

[ukrules]

2 hours ago, Mike Lister said:

 

Sherrings very clearly reports that as an instruction, effective 1 January 2024, not a proposal.

 

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

 

Yes, the only problem with that is that it seems to override a law which was voted on in parliament - and you can't do that with a memo.

 

[sirineou]

1 hour ago, The Cyclist said:

Do you know the difference between a new Law and a new interpretation of an existing Law ?

Don't get snarky with me.

"Interpretations of existing law ( if that's what you like to call it ) should be published before they are implemented. So I can conduct my affairs appropriately. 

 

 

 

 

[sirineou]

2 minutes ago, jerrymahoney said:

One of the few certain things right now is that, if you spend less than 180 days in any year in Thailand, you will owe nothing as you are not a Thai tax resident.

This is crazy we are living under a new law, or a new interpretation of an old law. but we will not be told what that new law, or new interpretation of an old law  until later.What kind of BS is that? 

It is like getting into a football game and are told by the referees that the rules will be "interpreted different than they always were, but we will not tell you how until later.

Would you play under such rules? 

This is beyond crazy. 

 

[Mike Lister]

1 hour ago, sirineou said:

Don't get snarky with me.

"Interpretations of existing law ( if that's what you like to call it ) should be published before they are implemented. So I can conduct my affairs appropriately. 

 

 

 

 

Ah...."should be"!

 

I'm not a lawyer and I haven't studied the issue so I can't comment with any certainty. But it does seem to me that the Director of the Revenue can issue operational instructions to his staff which is what he seems to have done. He hasn't changed the law or tried to make a new one, he's merely sought a legal view and offered a new interpretation, which he now wishes to operationalize. We might wish for things to be done in a certain way but should not be surprised when in Thailand that they are not.

[Mike Lister]

2 hours ago, ukrules said:

 

Yes, the only problem with that is that it seems to override a law which was voted on in parliament - and you can't do that with a memo.

 

Once again, a new law vs an operational interpretation, I think people are grasping at straws by trying to argue this point.

[The Cyclist]

1 hour ago, sirineou said:

So I can conduct my affairs appropriately. 

 

Do you think the Thai Gov / RD gives a 2nd thought to your affairs ?
 

2 hours ago, sirineou said:

should be published before they are implemented.

 

You do reside ( at least sometimes ) in Thailand ?
 

What should  happen, is more often than not, somewhat different here in Thailand.

[ukrules]

16 minutes ago, Mike Lister said:

Once again, a new law vs an operational interpretation, I think people are grasping at straws by trying to argue this point.

 

Not really, the law still stands.

 

The law if I remember correctly is very specific about this subject, it's not some little oversight or loophole, it was addressed directly. Zero taxation from prior years.

Signed. Sealed. Delivered.

 

To change a law requires a vote in parliament and there hasn't been a vote, not yet anyway.

 

[Mike Lister]

1 minute ago, ukrules said:

 

Not really, the law still stands.

 

The law if I remember correctly is very specific about this subject, it's not some little oversight or loophole, it was addressed directly. Zero taxation from prior years.

Signed. Sealed. Delivered.

 

To change a law requires a vote in parliament and there hasn't been a vote, not yet anyway.

 

I'm not a lawyer, I suspect you aren't either.

[BenStark]

On 1/4/2024 at 11:43 AM, The Cyclist said:

Thought you worked for 1 of the big 4 ?

Don't be mistaken, he worked as the doorman, and pretend to be a financial expert now

[ukrules]

24 minutes ago, Mike Lister said:

I'm not a lawyer, I suspect you aren't either.

 

Correct, it's going to be interesting once the lawyers do get hold of this though. However I feel that won't happen until well inside 2025.

 

 

[Mike Lister]

Just now, ukrules said:

 

Correct, it's going to be interesting once the lawyers do get hold of this though. However I feel that won't happen until well inside 2025.

 

 

I feel it may snow tomorrow. :)

[ukrules]

In fact having read up on this a little more it does look like it was never an actual 'law' to begin with - just an interpretation / ruling by the RD at the time.

In other words - this 'following year' thing which can be referred to as 'Resolution 2/2528' because that's what made it the rule back in 1985 is just a memo like the one they recently issued reverting it.

 

[UKresonant]

1 hour ago, ukrules said:

 

Not really, the law still stands.

 

The law if I remember correctly is very specific about this subject, it's not some little oversight or loophole, it was addressed directly. Zero taxation from prior years.

Signed. Sealed. Delivered.

 

To change a law requires a vote in parliament and there hasn't been a vote, not yet anyway.

 

 

If they are going to vote on something, why not do something more practical, and make it no tax before the prior year  and put an annual limit of say 2 or 3 million baht for remitting "savings" per year, the net size would be bigger, and would be more likely catch just fish they can eat.

 

Having to explain potentially all inward remittance, is complex, and has great potential to deter inward and VAT spend going forward.

 

They are copying other countries style of potentially introducing rules that have a high administrative overhead, and don't yield much of a practical benefit going forward. They just feel like they have done something.

[sirineou]

1 hour ago, Mike Lister said:

Ah...."should be"!

 

I'm not a lawyer and I haven't studied the issue so I can't comment with any certainty. But it does seem to me that the Director of the Revenue can issue operational instructions to his staff which is what he seems to have done. He hasn't changed the law or tried to make a new one, he's merely sought a legal view and offered a new interpretation, which he now wishes to operationalize. We might wish for things to be done in a certain way but should not be surprised when in Thailand that they are not.

You can not change policy retroactively  and hope that any sane person  will invest in your country. 

And since this policy starts Jan 1st and we don't know what the policy is Jan 7  any policy enounced Jan 8 would be applied retroactively  

That is Ex post facto law and is prohibited by the Thai constitution for that matter the constitution of any civilised country.  

So if the argument is that  there laws were already in the books but were not being enforced and now they will be enforced as someone else said , then it should be a simple matter to tell us what these laws are. 

 

[StayinThailand2much]

6 hours ago, The Cyclist said:

Perhaps it has sought opinions from stakeholders and postponed for a couple of years, and just forgot to announce it.

 

Hence the sound of silence

 

Considering, that many expats and long-term visa holders in Thailand are affected, has there been any attempt to consult them (or their embassies)?

[Mike Lister]

2 hours ago, StayinThailand2much said:

 

Considering, that many expats and long-term visa holders in Thailand are affected, has there been any attempt to consult them (or their embassies)?

Oh well, right there is the prime reason then, the expats weren't consulted first 

[Mike Teavee]

11 hours ago, sirineou said:

This is crazy we are living under a new law, or a new interpretation of an old law. but we will not be told what that new law, or new interpretation of an old law  until later.What kind of BS is that? 

It is like getting into a football game and are told by the referees that the rules will be "interpreted different than they always were, but we will not tell you how until later.

Would you play under such rules? 

This is beyond crazy. 

 

 

The way I see this is,  whatever you were doing last year in respect of bringing income into Thailand that was earned in the same calendar year is exactly the same.  The only difference is that the "Same Calendar Year" now means "Any Calendar Year from 2024 onwards", so 2024 will be exactly the same. 

 

I think the problem for most people (& I certainly include myself in this) is that we don't fully understand the tax rules as they were before this change but have not needed to do so as we weren't bringing in income the same Calendar year it was earned, so I guess that if we did fully understand the rules prior to 1/1/2024, then we'd know exactly what the rules are now & how we'll be impacted going forward. 

 

Simple example, somebody remitting 100K pm from a private pension each month as the pension is paid, if they should have been paying tax on it in 2023 then they should be paying tax on it in 2024, 2025 etc... , if they shouldn't then they won't be paying tax on it in 2024, 2025 etc... The same is true of any income. 

 

So I guess the answer (to me) is that I need to fully understand the current rules as (to the RD) this is just a "Clarification"/"Tweak" to one part of the rules which they've already explained, so there's nothing more to explain. 

 

Now if I have questions on "What is assessable income", "How do DTAs impact my Tax Calculations", "Can I gift my partner money" etc... etc... etc... then nothing has changed in respect of these so I can't really expect the RD to think that they have to explain "any changes" to me. 

[Mike Lister]

I have incorporated all the changes that have been suggested into Version 5 of the Tax Guide (below) and asked the Moderators to pin it in a locked thread, within the Finance section. If anyone wishes to suggest further changes, you can either post them here and hope that I spot them, or, you can PM me with the suggestion which I will ensure is discussed by a wider audience. If there is agreement that further changes should be made, and/or as new developments occur, I will attempt to update the document to keep it current.

 

A SIMPLE GUIDE TO PERSONAL INCOME TAX IN THAILAND

8 January, 2024

Version 5

 

1. This guide has been compiled in an attempt to provide readers with the simplest possible over view of Personal Income Tax (PIT) in Thailand. The scope of this document is limited to PIT.

 

2. You may have heard that new tax laws came into effect on 1 January this year, in fact, that is not true! The old tax rules still exist and remain valid, albeit just one minor change to them was made in November last year. Previously, anyone who earned money overseas and remitted it to Thailand in a different tax year, received that money free of Thai tax. That loop hole in the Revenue Department (RD) tax code has been extensively exploited by wealthy Thai’s and is now closed, hence, any money earned overseas and remitted to Thailand in any year, is now liable to Thai tax. The purpose of the new rule is to reduce tax avoidance. Unfortunately, it now means that overseas funds transfers by foreigners living in Thailand, also have an increased risk of being taxed.

 

3. This guide is an overview of the core parts of the PIT system. It is not designed to be exhaustive and it doesn’t cover all aspects of PIT, nor is it intended to  override anything produced by the Thai Revenue or specialist tax companies such as Sherrings or Mazzars. This guide also does not address all types of income or the rules relevant to people from every country. What this guide will provide is a starting point for readers to manage their own tax affairs and it will also provide most of the answers for those with simple tax affairs, especially the average pensioner.

 

4. There are also certain types of visa that fall outside of the RD tax code. The LTR visa for example received its tax exempt status by royal decree hence visa holders will not to be assessed for Thai tax and they are specifically excluded from this explanation.

 

5. Terminology: this document uses the word “assessable” often. Assessable in the context of this document means income that is liable to tax and must be included on a Thai tax return. Not all income is assessable, some is excluded from tax assessment by its very nature or because of the terms of a specific tax agreement.

 

6. Dual Tax Agreement/Double Tax Agreement (DTA): is an agreement between two countries that sets out which of the two countries has the right to tax specific types of income and all the associated rules. It’s purpose, in part, is to ensure that the same funds are not taxed twice and provides a means by which tax that is paid twice, can be recovered, how and from where. Note: If the taxpayer income is sourced in one country but the tax  payer is resident in a second country, use of a DTA can result in increased tax being paid, if the second country has a higher rate of tax on the type of income in question, than the other.

 

7. If you stay in Thailand for more than a cumulative 180 days, between 1 January and 31 December each year, you will be considered to be Tax Resident in Thailand during that year, regardless of the type of visa you have. It doesn’t matter that you may be Tax Resident in your home country or elsewhere or that you pay tax in those countries, Thailand will still regard you as Tax Resident. Tax Residency and Immigration status (and the visa you hold) are different things. Tax residency is based solely on the number of days you spend in Thailand and where you are at midnight on each day.

 

8. Because you are Tax Resident, YOU must review your income each year to determine if it is regarded as assessable to tax in Thailand, nobody else will do this for you. If your income does not exceed 120,000 baht per year, you do not need to file a tax return (60,000 baht if your only income is bank interest paid to you by a bank in Thailand). If your income is over 120,000 baht per year, you must file a Thai tax return between 1 January and 31 March.

 

9. Your income in Thailand is defined as any money paid to you inside Thailand, as well as, any money you receive from overseas, both types are potentially assessable income for Tax Residents. There are many types of income that can be classed as assessable, the Thai RD lists some of them and is linked below, however, the list is not exhaustive:

https://sherrings.com/personal-income-tax-in-thailand.html#:~:text=Section%2040%20of%20Thailand's%20Revenue,Pensions%3B%20and

 

10. There are also classes or types of income that the RD does not regard as assessable and these are also linked below:

https://www.rd.go.th/english/37749.html

 

11. Income that is derived from  within Thailand is fairly clear, if you work and have a job and you are a Tax Resident, your income is assessable for tax.  Interest that is paid to you on Thai bank accounts is regarded as income, as is income from investments such as stocks and bonds within Thailand.  You should note that if you are generating income by working while staying in Thailand, it is (and has always been) irrelevant where that money is paid and whether you bring the money into the country or keep it offshore. That money arises in Thailand hence it is taxable here.

 

12. It is not possible to give the same blanket rule to everyone to determine whether income is assessable or not because of the variable factors involved. Overseas income has to pass several tests to determine if it is assessable to Thai tax or not. It is still early days and all the rules are not yet clear. It has been said that tax residents who import funds from countries that have a DTA with Thailand, will not be effected. Exactly how that will work leaves many questions unanswered hence this document attempts to look at only the most popular types of income based on what is known at present. This document does not speculate as to what may happen in the future, other than in the segment at the end concerning likely future Immigration rules.

 

13. If we take the simplest type of income and say that you transfer personal savings from overseas to Thailand and those savings  were earned before 1 January 2024, those funds are not assessable. But savings earned after that date are, hence the date when the income is earned is extremely important. A word of caution, you may be asked to provide proof that savings were earned before 1 January 2024.  

 

14. Another common type of income is pensions, which can be complicated, depending on the type of pension and the country that it comes from. The country of origin is important because there are over 60 different types of Dual Tax Agreements, sometimes called Double Taxation Agreements (DTA’s), between Thailand and those 60+ countries and each one is different. As a general rule, most private or company pensions from most countries appear to be assessable here but YOU will need to confirm that yours is or is not. If that is true, private and company pension income IS assessable income in Thailand.

 

15. US Social Security payments, a form of pension paid to some older people, can only be taxed by the US under DTA rules and Thailand is forbidden from taxing them, this means those payments are NOT assessable income. UK State pension on the other hand is not covered by a DTA so it is assessable income in Thailand whilst UK Government or Civil Service pensions are not!

 

16. The proceeds from the sale of a capital item such as overseas property, where funds are remitted to Thailand, is one popular source of funds, the sale of some investment products such as stocks, shares and bonds is another. Those proceeds typically comprise two parts, capital and profit. If the capital was acquired before 1 January 2024, it is free of Thai tax. One way to separate capital and profit may bee to have an official valuation or statement that is dated 1 January 2024 since anything earned before that date, is not assessable. Also, if the profit has been the subject of a Capital Gains return in the home country, that also may be free of Thai tax but this cannot be guaranteed at this time, until things are made more clear and are once again subject to the terms of any DTA. YOU will need to review the DTA between Thailand and your home  country to fully understand what particular clauses affect you.

 

17. It appears as though most property rental income that is remitted to Thailand is considered to be assessable income and is taxable here, unless of course it has been taxed in the home country and/or the DTA prohibits its taxation (which seems unlikely).

 

18. YOU are responsible for determining if your assessable income in Thailand exceeds the threshold and means you must file a tax return. That assessable income might comprise, pension payments, investment income, rental income or any of the other types of income listed in the link above. If you have assessable income of over 120,000 baht per year, you must file a tax return (60,000 baht if your sole source of assessable income is bank interest paid in Thailand).

 

19. Before you can file a tax return in Thailand, you need to acquire a Tax Identification Number or TIN from the RD offices in your area. You will need your passport, a valid and current visa or extension and in many areas, a Certificate of Residency from the Immigration Department.

 

20. Completing a tax return is a simple affair for most people, if you have difficulty, the Revenue Department staff are extremely helpful. Tax returns must be filed between 1 January and 30 March each year, if you file later than that, penalties will apply.

 

21. Thai tax is layered in bands and is payable based on the amount of assessable income that  falls within each band and are shown and linked below:

 

Taxable Income per year(Baht) Tax rate

0 – 150,000 Exempt

150,000 – 300,000 5%

300,000 – 500,000 10%

500,000 – 750,000 15%

750,000 – 1,000,000 20%

1,000,000 – 2,000,000 25%

2,000,000 – 4,000,000 30%

Over 4,000,000 35%

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Payroll/Personal-Income-Tax

 

22. The Thai tax system contains a series of Allowances, Deductions and Exemptions that will help you reduce your tax bill and they are very generous. It is easily possible for the average expat foreign retiree to reduce their taxable income by 500,000 baht or more each year. For example, a retiree aged 65 years of age, married and living here full  time, supporting a Thai wife who has no income and doesn’t file tax return, is allowed the following:

 

a. Personal Allowance for self - 60,000

b. Personal Allowance for wife - 60,000

c. Over age 65 years exemption - 190,000

d. 50% of pension income received, up to 100k - 100,000

e. In addition, the first 150,000 of assessable income is zero rated and free of tax

 

23. Additional deductions and allowances exist for health or life insurance premiums paid in Thailand. A complete list of deductions, allowances and exemptions can be found here

https://www.rd.go.th/english/6045.html  or from Sherrings below.

https://sherrings.com/personal-tax-deductions-allowances-thailand.html

 

24. The Thai Revenue  tax filing system is online but is only available in Thai language at present. The tax forms are however available in English and they can be downloaded from the link below. CAUTION, the forms are updated every year and the 2023/24 forms for full year PIT are NOT yet available:

https://www.rd.go.th/english/63902.html

 

25. A simple sample completed tax form for a person aged over 65 years is shown below as a guide.

26. https://aseannow.com/topic/1312534-taxation-of-ex-pats-pensions-etc/?do=findComment&comment=18532562

 

27. Tax filing in Thailand is based on the honour system, it relies on you declaring all the right information every year and there are severe penalties for evading Thai tax. It would be foolish and a gross under estimation of RD capabilities to think  that doing nothing and keeping a low profile means you should ignore Thai taxation. Very few sane people in the US and UK ignore the tax authorities who tend to have a long reach. It cannot be ruled out that at some point, a link may be established between tax filings and visa extensions. A law already exists that requires foreigners to apply for Tax Clearance Certificates before being allowed to depart the country but it is not being enforced currently. These things are possible because similar things have been adopted in several countries in the past, including the US.

 

28. There are several sources of detailed tax information and these web sites are linked below:

https://www.rd.go.th/english/6045.html

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

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Payroll/Personal-Income-Tax

 

*** END ***

 

 

 

[redwood1]

29 minutes ago, Mike Lister said:

I have incorporated all the changes that have been suggested into Version 5 of the Tax Guide (below) and asked the Moderators to pin it in a locked thread, within the Finance section. If anyone wishes to suggest further changes, you can either post them here and hope that I spot them, or, you can PM me with the suggestion which I will ensure is discussed by a wider audience. If there is agreement that further changes should be made, and/or as new developments occur, I will attempt to update the document to keep it current.

 

A SIMPLE GUIDE TO PERSONAL INCOME TAX IN THAILAND

8 January, 2024

Version 5

 

1. This guide has been compiled in an attempt to provide readers with the simplest possible over view of Personal Income Tax (PIT) in Thailand. The scope of this document is limited to PIT.

 

2. You may have heard that new tax laws came into effect on 1 January this year, in fact, that is not true! The old tax rules still exist and remain valid, albeit just one minor change to them was made in November last year. Previously, anyone who earned money overseas and remitted it to Thailand in a different tax year, received that money free of Thai tax. That loop hole in the Revenue Department (RD) tax code has been extensively exploited by wealthy Thai’s and is now closed, hence, any money earned overseas and remitted to Thailand in any year, is now liable to Thai tax. The purpose of the new rule is to reduce tax avoidance. Unfortunately, it now means that overseas funds transfers by foreigners living in Thailand, also have an increased risk of being taxed.

 

3. This guide is an overview of the core parts of the PIT system. It is not designed to be exhaustive and it doesn’t cover all aspects of PIT, nor is it intended to  override anything produced by the Thai Revenue or specialist tax companies such as Sherrings or Mazzars. This guide also does not address all types of income or the rules relevant to people from every country. What this guide will provide is a starting point for readers to manage their own tax affairs and it will also provide most of the answers for those with simple tax affairs, especially the average pensioner.

 

4. There are also certain types of visa that fall outside of the RD tax code. The LTR visa for example received its tax exempt status by royal decree hence visa holders will not to be assessed for Thai tax and they are specifically excluded from this explanation.

 

5. Terminology: this document uses the word “assessable” often. Assessable in the context of this document means income that is liable to tax and must be included on a Thai tax return. Not all income is assessable, some is excluded from tax assessment by its very nature or because of the terms of a specific tax agreement.

 

6. Dual Tax Agreement/Double Tax Agreement (DTA): is an agreement between two countries that sets out which of the two countries has the right to tax specific types of income and all the associated rules. It’s purpose, in part, is to ensure that the same funds are not taxed twice and provides a means by which tax that is paid twice, can be recovered, how and from where. Note: If the taxpayer income is sourced in one country but the tax  payer is resident in a second country, use of a DTA can result in increased tax being paid, if the second country has a higher rate of tax on the type of income in question, than the other.

 

7. If you stay in Thailand for more than a cumulative 180 days, between 1 January and 31 December each year, you will be considered to be Tax Resident in Thailand during that year, regardless of the type of visa you have. It doesn’t matter that you may be Tax Resident in your home country or elsewhere or that you pay tax in those countries, Thailand will still regard you as Tax Resident. Tax Residency and Immigration status (and the visa you hold) are different things. Tax residency is based solely on the number of days you spend in Thailand and where you are at midnight on each day.

 

8. Because you are Tax Resident, YOU must review your income each year to determine if it is regarded as assessable to tax in Thailand, nobody else will do this for you. If your income does not exceed 120,000 baht per year, you do not need to file a tax return (60,000 baht if your only income is bank interest paid to you by a bank in Thailand). If your income is over 120,000 baht per year, you must file a Thai tax return between 1 January and 31 March.

 

9. Your income in Thailand is defined as any money paid to you inside Thailand, as well as, any money you receive from overseas, both types are potentially assessable income for Tax Residents. There are many types of income that can be classed as assessable, the Thai RD lists some of them and is linked below, however, the list is not exhaustive:

https://sherrings.com/personal-income-tax-in-thailand.html#:~:text=Section%2040%20of%20Thailand's%20Revenue,Pensions%3B%20and

 

10. There are also classes or types of income that the RD does not regard as assessable and these are also linked below:

https://www.rd.go.th/english/37749.html

 

11. Income that is derived from  within Thailand is fairly clear, if you work and have a job and you are a Tax Resident, your income is assessable for tax.  Interest that is paid to you on Thai bank accounts is regarded as income, as is income from investments such as stocks and bonds within Thailand.  You should note that if you are generating income by working while staying in Thailand, it is (and has always been) irrelevant where that money is paid and whether you bring the money into the country or keep it offshore. That money arises in Thailand hence it is taxable here.

 

12. It is not possible to give the same blanket rule to everyone to determine whether income is assessable or not because of the variable factors involved. Overseas income has to pass several tests to determine if it is assessable to Thai tax or not. It is still early days and all the rules are not yet clear. It has been said that tax residents who import funds from countries that have a DTA with Thailand, will not be effected. Exactly how that will work leaves many questions unanswered hence this document attempts to look at only the most popular types of income based on what is known at present. This document does not speculate as to what may happen in the future, other than in the segment at the end concerning likely future Immigration rules.

 

13. If we take the simplest type of income and say that you transfer personal savings from overseas to Thailand and those savings  were earned before 1 January 2024, those funds are not assessable. But savings earned after that date are, hence the date when the income is earned is extremely important. A word of caution, you may be asked to provide proof that savings were earned before 1 January 2024.  

 

14. Another common type of income is pensions, which can be complicated, depending on the type of pension and the country that it comes from. The country of origin is important because there are over 60 different types of Dual Tax Agreements, sometimes called Double Taxation Agreements (DTA’s), between Thailand and those 60+ countries and each one is different. As a general rule, most private or company pensions from most countries appear to be assessable here but YOU will need to confirm that yours is or is not. If that is true, private and company pension income IS assessable income in Thailand.

 

15. US Social Security payments, a form of pension paid to some older people, can only be taxed by the US under DTA rules and Thailand is forbidden from taxing them, this means those payments are NOT assessable income. UK State pension on the other hand is not covered by a DTA so it is assessable income in Thailand whilst UK Government or Civil Service pensions are not!

 

16. The proceeds from the sale of a capital item such as overseas property, where funds are remitted to Thailand, is one popular source of funds, the sale of some investment products such as stocks, shares and bonds is another. Those proceeds typically comprise two parts, capital and profit. If the capital was acquired before 1 January 2024, it is free of Thai tax. One way to separate capital and profit may bee to have an official valuation or statement that is dated 1 January 2024 since anything earned before that date, is not assessable. Also, if the profit has been the subject of a Capital Gains return in the home country, that also may be free of Thai tax but this cannot be guaranteed at this time, until things are made more clear and are once again subject to the terms of any DTA. YOU will need to review the DTA between Thailand and your home  country to fully understand what particular clauses affect you.

 

17. It appears as though most property rental income that is remitted to Thailand is considered to be assessable income and is taxable here, unless of course it has been taxed in the home country and/or the DTA prohibits its taxation (which seems unlikely).

 

18. YOU are responsible for determining if your assessable income in Thailand exceeds the threshold and means you must file a tax return. That assessable income might comprise, pension payments, investment income, rental income or any of the other types of income listed in the link above. If you have assessable income of over 120,000 baht per year, you must file a tax return (60,000 baht if your sole source of assessable income is bank interest paid in Thailand).

 

19. Before you can file a tax return in Thailand, you need to acquire a Tax Identification Number or TIN from the RD offices in your area. You will need your passport, a valid and current visa or extension and in many areas, a Certificate of Residency from the Immigration Department.

 

20. Completing a tax return is a simple affair for most people, if you have difficulty, the Revenue Department staff are extremely helpful. Tax returns must be filed between 1 January and 30 March each year, if you file later than that, penalties will apply.

 

21. Thai tax is layered in bands and is payable based on the amount of assessable income that  falls within each band and are shown and linked below:

 

Taxable Income per year(Baht) Tax rate

0 – 150,000 Exempt

150,000 – 300,000 5%

300,000 – 500,000 10%

500,000 – 750,000 15%

750,000 – 1,000,000 20%

1,000,000 – 2,000,000 25%

2,000,000 – 4,000,000 30%

Over 4,000,000 35%

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Payroll/Personal-Income-Tax

 

22. The Thai tax system contains a series of Allowances, Deductions and Exemptions that will help you reduce your tax bill and they are very generous. It is easily possible for the average expat foreign retiree to reduce their taxable income by 500,000 baht or more each year. For example, a retiree aged 65 years of age, married and living here full  time, supporting a Thai wife who has no income and doesn’t file tax return, is allowed the following:

 

a. Personal Allowance for self - 60,000

b. Personal Allowance for wife - 60,000

c. Over age 65 years exemption - 190,000

d. 50% of pension income received, up to 100k - 100,000

e. In addition, the first 150,000 of assessable income is zero rated and free of tax

 

23. Additional deductions and allowances exist for health or life insurance premiums paid in Thailand. A complete list of deductions, allowances and exemptions can be found here

https://www.rd.go.th/english/6045.html  or from Sherrings below.

https://sherrings.com/personal-tax-deductions-allowances-thailand.html

 

24. The Thai Revenue  tax filing system is online but is only available in Thai language at present. The tax forms are however available in English and they can be downloaded from the link below. CAUTION, the forms are updated every year and the 2023/24 forms for full year PIT are NOT yet available:

https://www.rd.go.th/english/63902.html

 

25. A simple sample completed tax form for a person aged over 65 years is shown below as a guide.

26. https://aseannow.com/topic/1312534-taxation-of-ex-pats-pensions-etc/?do=findComment&comment=18532562

 

27. Tax filing in Thailand is based on the honour system, it relies on you declaring all the right information every year and there are severe penalties for evading Thai tax. It would be foolish and a gross under estimation of RD capabilities to think  that doing nothing and keeping a low profile means you should ignore Thai taxation. Very few sane people in the US and UK ignore the tax authorities who tend to have a long reach. It cannot be ruled out that at some point, a link may be established between tax filings and visa extensions. A law already exists that requires foreigners to apply for Tax Clearance Certificates before being allowed to depart the country but it is not being enforced currently. These things are possible because similar things have been adopted in several countries in the past, including the US.

 

28. There are several sources of detailed tax information and these web sites are linked below:

https://www.rd.go.th/english/6045.html

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

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Payroll/Personal-Income-Tax

 

*** END ***

 

 

 

You put a big effort into this post.....

 

But if these numbers are correct..

 

Taxable Income per year(Baht) Tax rate

0 – 150,000 Exempt

150,000 – 300,000 5%

300,000 – 500,000 10%

500,000 – 750,000 15%

750,000 – 1,000,000 20%

1,000,000 – 2,000,000 25%

2,000,000 – 4,000,000 30%

Over 4,000,000 35%

 

This is a stinking joke.....

 

Just renting a very modest 17,000 baht a month condo would already put you at 204,000 baht and thats before you spend so much as one dollar on any thing else in a entire year......God forbid if you needed to eat or use electricity or visit a hospital etc...

 

Even a Thai worker only making 500 baht a day.......500 X 365= 182,500 baht a year...

 

So is every Thai and Farang  not homeless and living on the beach going to be paying this tax?

 

Yea right when pigs fly...

 

If they want this tax to really work they must give out at least a 2-3 million baht exemption every year to everybody.....So they will only be catching big fish...