Local news

Tighter tax rules not applicable if double taxation agreement signed: Expert

AMID concern among foreigners who have retired in Thailand about the impact of more stringent tax rules on remittance of overseas income as announced on Sept. 15, 2023 an expert pointed out this could be avoided if their country has signed a double taxation agreement with Thailand.

According to the Revenue Department directive issued on that day, Thai tax residents, that is anyone who has lived in the country for more than 180 days, have to report and pay income tax on funds transferred from abroad starting Jan. 1, 2024.

Legal experts said that the policy specifically targets residents trading in foreign stock markets through foreign brokerages, cryptocurrency traders and Thais who have been exploiting a loophole that allowed them to bring foreign earnings into the country tax-free after keeping it in an offshore account for more than a calendar year.

Amid this concern that has spread among Thais married to foreigners or who have income from overseas investment as they face paying income tax in the new year are puzzling questions about exemptions.

Dr. Yutthana Srisawat, professor of tax law and deputy dean of Siam University’s  Faculty of Law, said in an interview with Thai Rath newspaper on Sept. 21 that the new rules apply to Thais working overseas too as they would have to pay tax on money they bring back to Thailand if they stay in the country for longer than 180 days.

“This tax is levied only on people who earn income abroad, if they stay in Thailand for less than 180 days they don’t have to pay the tax, so people living abroad who have not settled in Thailand do not have to worry about anything.

“But it affects those who retire and then come to Thailand. For example, having worked overseas for 10-20 years and saved money all their life and bringing it all to Thailand after retiring, there is a risk of having to pay the tax because they meet the criteria of having stayed in Thailand for more than 180 days,” he said.

However, Dr. Yutthana said the Revenue Department has to issue further details on this new tax measure because some countries have signed a double taxation agreement with Thailand, that is if the foreign retiree has paid tax in the country of origin they would be exempted when bringing money to Thailand.

This then leads to having to submit proof that they have done so, he added.

The same applies to Thai workers overseas because when they bring money back to Thailand and stay longer than 180 days they are eligible to pay this tax. However a small group that does not bring much money escapes the net with there also being loopholes for other groups getting overseas income to avoid this tax.

While the guidelines for investors are clear, details have not yet been released with this leading to adjustments having to be made when it is enforced, he said, adding that the Revenue Department is aware of the problem and realises talks have to be held and clear guidelines given.


A graphic image on paying tax by Mohamed Hassan from Pixabay

Also read: Srettha to be taken to task over alleged tax-evading real estate

D-Day April 1 for new vehicle tax rule

Countries back global minimum corporate tax of 15%

No Plan B for digital wallet campaign: Julapun

Parallel populist project unveiled for the well-to-do

Tesla eying three locations for possible factory in Thailand: PM


Leave a Reply