Principles of Instruction for the Revenue Department’s Tax Regulations Issued 15 September 2023
Instruction No. 161/2566 issued on 15 September B.E. 2566 (2023) explains that a person is subject to income tax from receiving a foreign-source income in the following elements of the Revenue Code’s Section 41 paragraph 2:
- A person who receives a foreign-source income resides in Thailand at least 180 days in a tax calendar year.
- A person who enters into Thailand in the 2024 calendar year and the subsequent years.
Per the cases above, such an individual is obligated to disclose this income brought into Thailand when calculating the income tax rate for the calendar year.
Example: In 2023, Adam resided in Thailand for 200 days total. He had a foreign-source income from rental property overseas, in which that income was transferred into his offshore account. Later in 2027, Adam transferred that money into his bank account in Thailand. Thus, Adam must disclose that money for calculating the income tax for the 2027 calendar year.
Enforcement Period of New Thai Taxation Law
From 1 January B.E. 2567 (2024) onwards, any income brought into Thailand shall be subject to income tax, according to instruction No. P 161/2566 under Section 41 paragraph 2 of the Revenue Code.
Thai Permanent Residency Eligibility Status
A person who resides in Thailand for at least 180 days in the calendar year, whether consecutive or in parts combined, regardless of nationality or race, qualifies as a resident.
Case 1: Ambrose resided in Thailand every day from January to December 2024, for a total 366 days. Thus, Ambrose is considered a Thai resident in the 2024 calendar year under the new tax law.
Case 2: Britney resided in Thailand in odd months of 2024 for a total of 184 days. Thus, Britney is deemed to be a Thai resident in the 2024 calendar year.
Case 3: Craig resided in Thailand from January to December 2024, for a total of 179 days. As such, Craig does not qualify as a Thai resident in the 2024 calendar year.
Example 4: Douglas resided in Thailand for a total of 250 days consecutively: the first 100 days in 2024, and the last 150 days in 2025. As a result, Douglas was not a Thai resident in the calendar years of 2024 and 2025 because he did not reside for at least 180 days in either of those years.
Types of Income Subject to Taxation Under Section 41 of the Revenue Code
A foreign-source income subject to taxation is defined in Section 40 (1 to 8) of the Revenue Code. Nonetheless, taxpayers can receive an exemption from paying income taxes in Thailand under certain conditions. For example, inheritance must not exceed 20 million THB in that tax calendar year.
If I Purchase a Debenture From Overseas and Receive Interest from it, am I Subject to Pay Income Taxes for it in Thailand?
No need to pay taxes for the principal, but the interests that are brought into Thailand are classified as assessable incomes under Section 40 (4) (A) of the Revenue Code. Should you receive such interests within the tax calendar year, the individual must be a Thai resident from day 180 onwards.
Do I Have to Pay Income Taxes for Foreign-Sourced Income Brought into Thailand in 2024?
Yes. If an individual resides in Thailand for 180 days or more during the tax calendar year, in which the individual receives the income at the same year. From 1 January 2024 onwards, that income is subject to taxation. The individual must take it into account for income tax in the 2024 tax calendar year, and need to submit the income tax form within March 2025.
Do I Have to Pay Income Taxes for Foreign-Sourced Income Brought into Thailand in 2023?
Yes. If the income is established in the 2023 tax calendar year and the individual resides in Thailand for 180 days or more in such a year. That individual must take the income in for the tax rate calculation in the 2023 tax calendar year and submit the income tax form within March 2024.
For the Entire Year, I Haven’t Resided in Thailand for 180 Days or More, but Have a Foreign-Sourced income. Do I have to Pay Taxes if that Income is Brought into Thailand?
No, in spite of bringing the income into Thailand.
Example: In 2028, Adrian resided in Thailand for 65 days in total. Adrian received income from property rent overseas, which was transferred into his offshore bank account. Simultaneously, Adrian had transferred that income into his bank account in Thailand. Thus, he was not subject to pay an income tax in Thailand as he was not a Thai resident during the time of receiving that income.
A Foreigner Living and Working Abroad, or Operating an Overseas Business Desires Returning to Thailand. Is he/she Liable to Pay Income Taxes if the Foreign-Sourced Earnings are Brought Back into the Kingdom?
No. Since the person does not reside in Thailand for at least 180 days in a particular tax calendar year, that person’s incomes from work and overseas business operations are not subject to income tax.
Example: Dee was a Thai citizen and resided in China since 2007. In 2024, Dee had to return back to Thailand permanently, so she brought her entire income from business operations in China. With such, she had no obligation to pay income tax for carrying that money into Thailand in 2024 due to her status as not a Thai resident in such a tax calendar year.
Does a Foreign-Sourced Income Already Taxed From a Foreign Country Become Subjected to Double Taxation in Thailand?
No, the double taxation laws do not apply here. In this case, an individual residing in Thailand for 180 days or more can bring a tax credit to the Thai government clarifying about the double tax agreements where Thailand is a contractual party with a particular state.
Instruction of Revenue Department P. 161/2566 is not Law. Should Taxpayers Comply with that Instruction?
It is not a law, rather an explanation to Section 41 paragraph 2 of the Revenue Code. A taxpayer still has to comply with the tax law, in which the instruction of the Revenue Department type P. is an instruction from the Director General, as a commander, orders Revenue Department officers to apply it in providing advice towards taxpayers for legal compliance.
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