The Thai Revenue Departments Orders No. P. 161 and 162/2566, which will come into effect in January 2024, have caused growing concern among expatriates in Thailand.

 

What is it about?

All residents of Thailand must report overseas income when it is brought into the country. This includes income from work, investments and assets outside Thailand. However, any income earned before this date can be remitted to Thailand tax-free, provided it is done by December 31, 2024.

 

Who is considered a Resident?

According to Section 41, Paragraph 3, any person who stays in Thailand for 180 days or more in any tax year shall be deemed to be a resident and shall comply with these tax provisions.

 

Do we have to worry? Well, it depends!

The new tax rules have a significant impact on expatriates and long-term residents in Thailand, especially those with income from abroad.

Any income from foreign work or assets must be reported if remitted to Thailand from January 1, 2024. This includes dividends, interest, rental income and capital gains from foreign investments.

However, expatriates whose income is already taxed in another country, such as pensions, are not subject to the additional Thai tax. This is particularly relevant for retirees living in Thailand who receive pensions from their home country.

 

What is required?

Taxpayers must prepare and file the Income Tax Declaration (Form 90) by March 31, 2025. This form will include all relevant income and deductions for the tax year.

 

What about Retirees?

Although pensions are exempt from additional Thai taxes, retirees must still submit Form 90 to declare their income and any applicable deductions by March 31, 2025. At least this is what the Revenue Department says, but how it will be implemented is everyone’s’ guess!

 

Keep all records

It is important to keep comprehensive records of all sources of income, taxes paid abroad, and all remittances to Thailand. Proper documentation will help accurately report income and claim any applicable deductions or exemptions.

 

At last!

There are no clear guidelines from the authorities yet, so people familiar with the matter believe the rollout will be gentle at first and could take several years, with the big fish with high and untaxed remitted income to be targeted first. We will have to wait and see.