Must Read A SIMPLE GUIDE TO PERSONAL INCOME TAX IN THAILAND

[Mike Lister]

Just now, Sheryl said:

Am I correct in assuming that where it says "if your income does not exceed 120,000 baht per year, you do not need to file a tax return" it really means if your assessable income income does not exceed..."

 

?

 

 

That is correct, assessible income only. There are two tax forms, PND 90 and 91. PND 90 is for people with income from Thai bank savings only, PND 91 is fo0r those with bank savings and other income. The threshold for PND 90 is 60k Baht, and for PND 91, 120k Baht.

[RichardColeman]

 

 

 

 

5 minutes ago, miketu said:

Am I understanding this correctly? -  my income is only taxable if I bring/import  it into Thailand?  If I do not bring my income into Thailand it is not taxable?  Is this the correct interpretation?

 

 

Way I see it is that income will only be taxable if 'earned' and untaxed abroad or paid by state untaxed and forwarded by the company or state through a bank transfer. I think this is justifiable and fair . I know many will say I am wrong, but I do not think Thailand will get away with taxing people's money TWICE. The whole thing is ridiculous until further clarified. I also believe it will fall apart on the first legal challenge by a foreigher or a Thai

 

I am not seeing anything from the poster of this thread that deals with savings transfers - which is NOT income - merely a transfer form bank to bank.

 

I send to Thailand a mix of income AND savings - this is not therefore all income

 

13 minutes ago, Mike Lister said:

I have news for you, you were given a formal request to file a tax return, the second you met the criteria for filing one, the fact that you didn't means you ignored that (implied) request

 

Seriously ? I am not aware of anyone being given a formal request in writing to file a tax return other than net speculation. If you can show me evidence of foreigners being given written information on this directly I will agree with you

 

 

[Mike Lister]

1 minute ago, RichardColeman said:

 

 

 

 

 

Way I see it is that income will only be taxable if 'earned' and untaxed abroad or paid by state untaxed and forwarded by the company or state through a bank transfer. I think this is justifiable and fair . I know many will say I am wrong, but I do not think Thailand will get away with taxing people's money TWICE. The whole thing is ridiculous until further clarified. I also believe it will fall apart on the first legal challenge by a foreigher or a Thai

 

I am not seeing anything from the poster of this thread that deals with savings transfers - which is NOT income - merely a transfer form bank to bank.

 

I send to Thailand a mix of income AND savings - this is not therefore all income

 

 

Seriously ? I am not aware of anyone being given a formal request in writing to file a tax return other than net speculation. If you can show me evidence of foreigners being given written information on this directly I will agree with you

 

 

When you receive your visa and enter the country, you are required to follow the laws of the country and Revenue Department rules are included in that. 

 

As for the rest of what you wrote, you need to read the document in the OP to answer your own questions, it is clear you have not thus far or that you have not understood..

[parallelman]

1 hour ago, Mike Lister said:

So you are expecting a personal invite from the government to apply for a TIN and file a tax return......that's interesting and also completely wrong! Why do you think you don't have to file taxes, if you are tax resident and meet the threshold for filing a return, just because nobody came and told you to.......jeeze?

Perhaps I can put a different way. An OAP not a member of this forum (or any other) and previously not filing tax returns, how will that OAP know that the rules have changed? Is it possible that notification will be through immigration or bank although I can find no mention of such a process.

[Sheryl]

46 minutes ago, miketu said:

Am I understanding this correctly? -  my income is only taxable if I bring/import  it into Thailand?  If I do not bring my income into Thailand it is not taxable?  Is this the correct interpretation?

 

Correct assuming the income is not Thai-sourced.

[Sheryl]

1 hour ago, Mike Lister said:

$40k per tax year in SSc income from the US would be zero tax in Thailand because all excluded by DTA - it's all excluded income (or so the experts on the US DTA have posted).

It is without question, very clearly, taxable only in the US. (And needs no expertise to see that, just read sections 20 and 21 of the DTA).

 

If the only income coming into Thailand  is from SS, there is 0 assessable income...and therefore

no need to file a tax return or pay tax in Thailand.

 

(You may, of course, need to pay tax on it in the US, depending on overall income).

 

[Thingamabob]

57 minutes ago, Mike Lister said:

Formally requested, you mean like a state opening of Parliament type event!

 

There is no connection (at present) between immigration affairs and tax affairs, they are different government departments that deal with totally different areas. 

 

I have news for you, you were given a formal request to file a tax return, the second you met the criteria for filing one, the fact that you didn't means you ignored that (implied) request. The criteria are:

 

- You became tax resident

- you had assessible income over 60k baht in the tax year.

I willi ignore your sarcasm and simply point out that there are thousands if long term foreign residents in Thailand who are not on this, or any other forum, who have no knowledge whatsoever of the criteria/requirement for filing a tax return. Unless they are not formally told to file they will presumably not do so.  

[Kerryd]

How do they determine what is "income" and what is simply a transfer ?

I'm a "non-resident for tax purposes" according to Revenue Canada. As a result, they tack a 25% "Snowbird" tax onto my pension, which is deposited into my Canadian account.

Once or twice a year I may make a transfer from there to my Thai account. That shouldn't count as "income" and it's already been taxed, but if I go to an accountant, how much you want to bet they will say otherwise.

And then tell me that "for a fee" they can fix it so I don't have to pay anything. (When I probably don't have to pay anything in the first place.)

I can see it now. Having to take 12 months of (Canadian) bank statements into the RD every year to prove the money from my pension and not "income". 

[EVENKEEL]

7 minutes ago, Thingamabob said:

I willi ignore your sarcasm and simply point out that there are thousands if long term foreign residents in Thailand who are not on this, or any other forum, who have no knowledge whatsoever of the criteria/requirement for filing a tax return. Unless they are not formally told to file they will presumably not do so.  

Exactly true. All the 10's of 1,000's of foreigners who don't know, have not heard a word of this tax thing. I simply find it mind boggling that the Thais can begin to figure out what is owed to the government from foreigners who come from all over the world. Simple things like 12 month extensions are handled differently at times at different locations.

 

I can just see these thais trying to figure out my tax return from home country.

Edited January 8 by EVENKEEL

[BE88]

10 minutes ago, EVENKEEL said:

Exactly true. All the 10's of 1,000's of foreigners who don't know, have not heard a word of this tax thing. I simply find it mind boggling that the Thais can begin to figure out what is owed to the government from foreigners who come from all over the world. Simple things like 12 month extensions are handled differently at times at different locations.

 

I can just see these thais trying to figure out my tax return from home country.

 

Right but they might ask you to pay for a certified translation like for weddings in Thailand.

If required it will be completely crazy bureaucracy.

 

[Guavaman]

1 hour ago, Mike Lister said:

There are two tax forms, PND 90 and 91. PND 90 is for people with income from Thai bank savings only, PND 91 is fo0r those with bank savings and other income. The threshold for PND 90 is 60k Baht, and for PND 91, 120k Baht.

Unfortunately, it is not that simple. The decision point is whether or not the tax resident has income from only category 1 (employment including pensions) or from category 1 plus any other of the 8 categories of assessable income. See NOTE regarding Thai bank withholding tax on interest below.

 

REFERENCE:  https://www.rsm.global/thailand/insights/rsm-focus/filing-pnd90-and-pnd91

 

PND.90 return is the personal income tax return to report the assessable income under Section 40(1) to (8)

 [Assessable income under Section 40 of the Revenue Code: 

    1. Employment (including pensions)

    2. Independent personal services 

    3. Goodwill, copyright and other (intangible) rights 

    4. Interest income, dividends and capital gains 

    5. Rental from property 

    6. Professional services 

    7. Hire of work (i.e., services contracts) ]

    8. Business, commerce, agriculture, industry, transport, etc.]

 

 PND.91 return is the personal income tax return to report the assessable income under Section 40(1) obtained from employment [category 1 only]

 

 [(40(1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.]

 

 Who is liable to pay personal income tax?

 

 Filing of PND.90/91 returns are summarized below:

PND.90 return [income under Section 40(1) to (8)]	PND.91 return [income under Section 40(1) derived from employment only]
Single status and assessable income exceeding 60,000 baht.	Single status and assessable income exceeding 120,000 baht.
Marriage status and assessable income together exceeding 120,000 baht	Marriage status and assessable income together exceeding 220,000 baht

 

[Note Regarding Thai bank withholding tax on interest : If a taxpayer chooses to file PND. 91, it means that the taxpayer accepts the default 15% withholding tax on interest on deposits in Thai bank accounts.  If the taxpayer chooses to claim any refund of that withholding tax, the taxpayer must file the more comprehensive PND. 90 filing form.]

[1FinickyOne]

2 hours ago, timendres said:

 

Honestly, I cannot answer that question. Since the income is not subject to tax, that would suggest you do not need to file. However, since it is over the minimum income required to file, and it will register money transfers to Thailand (mine is deposited directly), then it might require the filing stating "no tax due". The only benefit to having to file, is if you are parking 800K like I do, it gives you the opportunity to reclaim the interest withheld by the bank. Not a lot of money, but if the filing is mandatory, then I will collect to offset the "expense" of producing the filing.

If I remember correctly, you have stock market investments... is that in some way taxable? 

 

And if you bring money into Thailand, how is it determined if it is money that you made in previous years and is sitting in USA savings? I have stock, T-bills, money market accounts... all my money is from long standing accounts... 

[Mike Lister]

1 hour ago, parallelman said:

Perhaps I can put a different way. An OAP not a member of this forum (or any other) and previously not filing tax returns, how will that OAP know that the rules have changed? Is it possible that notification will be through immigration or bank although I can find no mention of such a process.

Probably through the media or sites like this, I don't think there is a formal notification system.

[Mike Lister]

48 minutes ago, Kerryd said:

How do they determine what is "income" and what is simply a transfer ?

I'm a "non-resident for tax purposes" according to Revenue Canada. As a result, they tack a 25% "Snowbird" tax onto my pension, which is deposited into my Canadian account.

Once or twice a year I may make a transfer from there to my Thai account. That shouldn't count as "income" and it's already been taxed, but if I go to an accountant, how much you want to bet they will say otherwise.

And then tell me that "for a fee" they can fix it so I don't have to pay anything. (When I probably don't have to pay anything in the first place.)

I can see it now. Having to take 12 months of (Canadian) bank statements into the RD every year to prove the money from my pension and not "income". 

If you are non resident, none of this applies to you.

 

All transfers are potentially income, it's up to the tax filer to distinguish and declare what is and what isn't, they are the only one to know,

[Mike Lister]

24 minutes ago, Guavaman said:

Unfortunately, it is not that simple. The decision point is whether or not the tax resident has income from only category 1 (employment including pensions) or from category 1 plus any other of the 8 categories of assessable income. See NOTE regarding Thai bank withholding tax on interest below.

 

REFERENCE:  https://www.rsm.global/thailand/insights/rsm-focus/filing-pnd90-and-pnd91

 

PND.90 return is the personal income tax return to report the assessable income under Section 40(1) to (8)

 [Assessable income under Section 40 of the Revenue Code: 

    1. Employment (including pensions)

    2. Independent personal services 

    3. Goodwill, copyright and other (intangible) rights 

    4. Interest income, dividends and capital gains 

    5. Rental from property 

    6. Professional services 

    7. Hire of work (i.e., services contracts) ]

    8. Business, commerce, agriculture, industry, transport, etc.]

 

 PND.91 return is the personal income tax return to report the assessable income under Section 40(1) obtained from employment [category 1 only]

 

 [(40(1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.]

 

 Who is liable to pay personal income tax?

 

 Filing of PND.90/91 returns are summarized below:

PND.90 return [income under Section 40(1) to (8)]	PND.91 return [income under Section 40(1) derived from employment only]
Single status and assessable income exceeding 60,000 baht.	Single status and assessable income exceeding 120,000 baht.
Marriage status and assessable income together exceeding 120,000 baht	Marriage status and assessable income together exceeding 220,000 baht

 

[Note Regarding Thai bank withholding tax on interest : If a taxpayer chooses to file PND. 91, it means that the taxpayer accepts the default 15% withholding tax on interest on deposits in Thai bank accounts.  If the taxpayer chooses to claim any refund of that withholding tax, the taxpayer must file the more comprehensive PND. 90 filing form.]

Thanks, yes, sorry, I got that back to front in my rush to go for dinner!

[Mike Lister]

51 minutes ago, EVENKEEL said:

Exactly true. All the 10's of 1,000's of foreigners who don't know, have not heard a word of this tax thing. I simply find it mind boggling that the Thais can begin to figure out what is owed to the government from foreigners who come from all over the world. Simple things like 12 month extensions are handled differently at times at different locations.

 

I can just see these thais trying to figure out my tax return from home country.

How do foreigners in Thailand find about any of the things that effect them here, this will be via the same mechanisms.

 

The Thai RD will not figure out how much is owed for tax, the individual must complete a tax return and tell them. Have you even read the document at the start of the OP!

[sirineou]

12 hours ago, CharlieH said:

 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.

First let me thank you for posting this,  and second  that IMO any change to an existing law , makes it a new law. All new laws are for the most part a variation of an existing law. 

but that's a different story. 

If I understand this correctly  due to the bilateral tax agreement between the US and Thailand,  income from SSI, private pension and annuities is taxed only at the source country, and as an American I should not have to pay tax  on my pensions. 

But what id my savings are a result of my unsend pensions?  If I save part of my pension and at some point decide to transfer such saving for a purchase in Thailand , would I have to pay tax on those funds? and if such occured would it not be a violation of the tax agreement between the US and Thailand? 

[Mike Lister]

8 minutes ago, sirineou said:

First let me thank you for posting this,  and second  that IMO any change to an existing law , makes it a new law. All new laws are for the most part a variation of an existing law. 

but that's a different story. 

If I understand this correctly  due to the bilateral tax agreement between the US and Thailand,  income from SSI, private pension and annuities is taxed only at the source country, and as an American I should not have to pay tax  on my pensions. 

But what id my savings are a result of my unsend pensions?  If I save part of my pension and at some point decide to transfer such saving for a purchase in Thailand , would I have to pay tax on those funds? and if such occured would it not be a violation of the tax agreement between the US and Thailand? 

Only funds remitted to Thailand are liable to Thai tax, funds that remain overseas are not.

[Bobthegimp]

4 hours ago, jaideedave said:

Bob, I receive a company pension from Canada. So I understand that can only be taxed in Canada? What about my OAS,CPP pensions? Same?

 

Company pension and CPP are work related pensions, so covered by the agreement. I'm not sure about OAS, but even if it is taxable here in Thailand, the taxes wouldn't amount to much after applying the Thai personal exemptions. 

 

A back of the napkin calculation comes to about 3900 baht per year if you get the full OAS, but it might be exempt. I'm in my mid 50's so I haven't bothered reading up on OAS. 

[Psychic]

So if I have this right I need to extend my time out of Thailand to 6 months avoid this entirely.

And if foreign money is only taxable if it is brought into Thailand then there is a disincentive to bring large amounts of money into Thailand.

 

I just don't see how any of these options benefits the Thai government.

Every thing purchased in Thailand is subject to tax.

Reducing the amount purchased only reduces that tax.

Add to that the fact this will further discourage new retirees coming to the country and spending significant sums and this just seems an absurd policy and a violation of the principle of no double taxation.

 

Do I have anything wrong here?

 

 

[sirineou]

Just now, Mike Lister said:

Only funds remitted to Thailand are liable to Thai tax, funds that remain overseas are not.

I understand that,

but what if such savings are a result of unspend pensions?

I have been fortunate enough  to have pension income above ny need..My pensions are deposited in my US bank account and consequently result in savings , ( I spend less than I receive)

In the past , occasionally I would transfer to Thailand some of these savings for vehicles and other property purchases. Would these pension savings now become taxable under the remitable savings provision of this old new law? And if so would it be a violation of the bilateral tax agreement? 

[Mike Lister]

17 minutes ago, sirineou said:

I understand that,

but what if such savings are a result of unspend pensions?

I have been fortunate enough  to have pension income above ny need..My pensions are deposited in my US bank account and consequently result in savings , ( I spend less than I receive)

In the past , occasionally I would transfer to Thailand some of these savings for vehicles and other property purchases. Would these pension savings now become taxable under the remitable savings provision of this old new law? And if so would it be a violation of the bilateral tax agreement? 

Tricky. The correct answer is that those funds should be tax free in Thailand but proving that chain, may be difficult and prove too much to easily explain to the Thai RD, should it ever become necessary to do so.

 

I would worry about this downstream, this is because not enough is known yet about how the RD intends to proceed. There is a possibility that, in its simplest form, the RD may say that any funds remitted to Thailand from a country with which Thailand has a DTA, are not taxable in Thailand. On the opposite end of the spectrum the RD may chose to play things more precisely and demand all the paperwork and audit trails from the home country. But given the complexity involved, combined with the different languages and formats, this seems highly unlikely. The bottom line is we don't know yet, hence, playing a waiting game until more is known, may be the best approach. I understand that much of this is counter culture for many foreigners who expect Revenue Departments to have all the answer beforehand. Thailand however is very different in its operation than many of our home countries.

[Guavaman]

1 hour ago, Sheryl said:

No tax owed in Thailand, and no need to file a tax return in Thailand.

If true, this is a very important assertion, for which clarification is lacking to date.

 

I have been studying the Thai Tax Code for 3 months, but I have not yet come across this concept: filing a nil return, with no tax payable, meaning (in Thailand):

 

Taxable income = assessable income minus: exemptions, deductions, allowances = 0 Baht.

 

Please provide a reference link to a Revenue Department webpage or a legal/tax firm webpage that provides advice that Thai tax residents are not required to file tax returns if the taxpayer self-determines that they "owe no tax".

 

TIT caveat: This is Thailand (TIT). As we have learned, a primary loveable aspect of Thai people is their radical empiricism -- responding to events in the most practical way for that particular person, muddling through in uncertainty, which underlies everything, everywhere, everytime.

 

[connda]

13 hours ago, CharlieH said:

12. ...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.

"...the rules are not yet clear."  And therein lies the problem.

Personally I don't see a problem other than paperwork shuffles and visa extension delays if Thai immigration is tasked with reviewing the tax returns of long-stay expats.  Now, there is a potential horror show.







 

[Pi Tao]

I understand this new rule.

But, if i lstay ess than 180 days,should i take this for my payements to Thailand ?

Thanks.

Edited January 8 by Pi Tao

[Asquith Production]

This topic is so big with vast consequences for many. The more I read the more questions need to be asked. The Thai Government needs to have tax advisor's at every immigration office so all expats become aware of it and what there tax liability may be. 

[Mike Lister]

8 minutes ago, connda said:

"...the rules are not yet clear."  And therein lies the problem.
 

The rules as of today are almost exactly what the rules have been for years, only one small aspect has changed. The problem here is that most foreigners are now beginning to understand that many of them should have filed tax returns in previous years but didn't. This means that everyone now has to learn all the rules, rather than just the one that has changed. Case in point, anyone who has lived here for a few years and has their pension remitted directly to their Thai bank account every month, probably should have been filing a return because in many cases, that pension was income that was not covered by a DTA and was remitted in the year it was earned. In this example, it's the people who rely on the income method that are the ones I refer to.

 

 

[Mike Lister]

17 minutes ago, Guavaman said:

If true, this is a very important assertion, for which clarification is lacking to date.

 

I have been studying the Thai Tax Code for 3 months, but I have not yet come across this concept: filing a nil return, with no tax payable, meaning (in Thailand):

 

Taxable income = assessable income minus: exemptions, deductions, allowances = 0 Baht.

 

Please provide a reference link to a Revenue Department webpage or a legal/tax firm webpage that provides advice that Thai tax residents are not required to file tax returns if the taxpayer self-determines that they "owe no tax".

 

TIT caveat: This is Thailand (TIT). As we have learned, a primary loveable aspect of Thai people is their radical empiricism -- responding to events in the most practical way for that particular person, muddling through in uncertainty, which underlies everything, everywhere, everytime.

 

I file a nil return most years. This is because 50% of my income is derived from US SSc which is exempted by treaty whilst the other 50% is from the UK State pension which whilst taxable here, is covered by the allowances, deductions and exemptions. The net is that I am over the earnings threshold so am required to file a return but my total assessable income does not reach the taxable level. Result, no tax due. 

[NorthernRyland]

 

3 hours ago, Mike Lister said:

I have news for you, you were given a formal request to file a tax return, the second you met the criteria for filing one, the fact that you didn't means you ignored that (implied) request. The criteria are:

 

- You became tax resident

- you had assessible income over 60k baht in the tax year.

 

but the government here throws out laws and then never enforces them. Not even the police follow simply traffic rules. I've spoken to two family members here who don't even know about these tax rules because they don't follow forums like this.

 

people are just going to ignore this until it's put in front of their faces and then the authorities can figure out how to deal with all the delinquent expats which owe them money.

[Mike Lister]

11 minutes ago, Pi Tao said:

I understand this new rule.

But, if i lstay ess than 180 days,should i take this for my payements to Thailand ?

Thanks.

If you stay less than 180 days, none of this effects you because you are not tax resident.