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Answered2 years ago

How will Thailand's new tax law on foreign-sourced income affect foreigners living in the country?

Ron ********
asked Jul 25, 2024
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Hello so I've been kind of living under a rock for a while and I heard televised late last year. So I'd like to know how is this affected you personally if at all. And how are you dealing with this if you're staying in Thailand for more than 180 days? This update was from February of this year that I just kind of read and summarized. Or in general what are your thoughts and opinions on this?

Starting January 1, 2024, Thailand has changed its tax laws concerning foreign-sourced income. Previously, Thai residents were taxed on foreign income only if it was brought into Thailand in the same calendar year. Now, under Departmental Instruction No. Paw 161/2566, any income earned overseas from employment, business, or property must be declared and taxed in Thailand, regardless of when it enters the country. This new rule applies to anyone residing in Thailand for 180 days or more in a calendar year.

### Impact on Foreigners in Thailand

For foreigners living in Thailand for more than 180 days in a calendar year:

1. Tax Obligations: They will be required to pay Thai income tax on any foreign-sourced income earned from employment, business, or property.

2. Income Declaration: All such income must be declared in the year it is earned, not when it is brought into Thailand.

3. Tax Rates: The tax rates range from 5% to 35%, depending on the amount of income earned.

4. Tax Filing: Income tax forms must be submitted by March of the following year.

This change ensures that foreigners with significant stays in Thailand are subject to the same tax rules as Thai citizens and residents, thereby promoting a fairer tax system.

This summary was according to the article that I read. Fairer. 😂
Answer summary
Starting January 1, 2024, Thailand has implemented new tax regulations stating that any foreign-sourced income must be declared and taxed for residents living in Thailand for more than 180 days in a calendar year. The changes, captured under Departmental Instruction No. Paw 161/2566, require these individuals to pay Thai taxes on all overseas earnings regardless of when they are brought to Thailand. The tax rates vary between 5% to 35%, and all income declarations must be made annually. This reform aims to equalize tax responsibilities among foreigners and Thai nationals. The discussion draws opinions from readers about the motivations behind these changes and clarifications on existing tax obligations.
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Tony ********
Tony ********
Ron, the statements in your post have all been in place for many years, and the important missing statement is 'on remitted funds'. Thailand currently only looks at funds you remit and declare for tax purposes. The rule change you mentioned means that where as funds earned internationally in one year and remited in another year are no longer tax exempt, except if they were earned prior to
*****
/23. All other rules remained unchanged.
Jo **********
Jo **********
The point is not about making sure that foreigners pay taxes. That’s very misleading. It’s making sure that mainly Thai nationals who have large investments outside of Thailand and get dividends on that pay taxes. It’s also aimed at all people who are bringing in foreign income that is not taxed elsewhere to pay tax. This has always been the case and the whole thing is not a major change but a clear mandate with perhaps stricter enforcement. You always need to pay taxes unless you live in one of those 0% tax countries
Ron ********
Ron ********
OP
Thanks guys. Your insight has given me a clearer idea of what this is all about.
Jo **********
Jo **********
@Ron *******
thanks for being open minded
Ron ********
Ron ********
OP
@Jo *********
I heard a bunch of panic about it late last year. Didn't really pay attention because things change rapidly here. Thanks for clearing that up. The above was just a summary of the article I read. I only included the parts that focused on the foreigners. I'll have to look into this more. Cheers.
Jo **********
Jo **********
@Ron *******
this of course is how I understand my thoughts are not perfect. I am sure they are not chasing cheap charlie on a retirement visa
Tony ********
Tony ********
@Ron *******
that would be the same in any country where an employee is off books and payed cash. Thailand operates a PAYE system and legit companies have to fulfil their obligations and apply a witholding tax along with the obligatory social security contribution.
Jeffrey ************
Jeffrey ************
@Ron *******
If they require a Thai tax return as part of visa extension it's easy
Colin *******
Colin *******
@Ron *******
CRS data feed. First one into Thailand in late 2023. Too easy, they already have the data feeds from over 120 countries.
John **********
John **********
@Ron *******
it's actually pretty organised, in a Thai sort of way
Ron ********
Ron ********
OP
@John *********
I should have been in a little clearer it's just that they don't have the tax system organized for their own people how are they going to organize it internationally
John **********
John **********
@Ron *******
most of the average thai people don't earn enough to pay tax
Jo **********
Jo **********
@Ron *******
exactly. What irritates me is all the people panicking about this.
Ron ********
Ron ********
OP
This was the original article BTW
Ron ********
Ron ********
OP
*************************************************************************************************************
%20new%20tax%20treatment%20has,such%20assessable%20income%20to%20Thailand.
Ron ********
Ron ********
OP
@Jo *********
most of the average Thai people that I know, don't pay taxes on their wages. I thought it would be an absolute task to tax foreigners when they can't even do it on their on soil. 🙂

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