Thailand’s revenue department has introduced new guidelines last week mandating that all income earned from abroad, whether from work or savings, will now be subject to personal income tax. A senior official from the Ministry of Finance has confirmed the accuracy of a document released by the revenue department over the weekend.
The new tax is part of a general overhaul on tax collection by the new government of PM Srettha Thavisin.
At this stage there are scant details and EACH person will need to evaluate the effect on these changes once full details have been announced.
According to the document, individuals who generate income through foreign occupations or businesses, or possess assets located abroad and bring them into Thailand, will be required to include this income in their personal income tax calculations for the year. It will only apply for people that spend more than 180 days per year in the Kingdom and won’t be applicable to tourist.
This new taxation program is set to take effect on January 1, 2024, and will exclusively apply to tax residents in Thailand – in other words, people registered to pay tax in Thailand.
The change is meant to close an apparent loophole in the Thai tax system that allows people to avoid paying income tax on foreign assets and earnings by leaving the income abroad until the following tax year.
Tourists and short-term workers will be exempt from the new regulations. Additionally, individuals who have already been taxed in a foreign country that maintains a Double Tax Agreement with Thailand will also be exempt.
HERE‘s a list of countries that currently have a Double Tax treaty with Thailand.
There remains uncertainty regarding how this tax policy will be applied to foreigners residing in Thailand under retirement visas.
We would strongly advise waiting for the details on this proposal to become full available between now and the proposed January 1, 2024, start date.