Thailand to tax residents’ foreign income irrespective of remittance

The Revenue Department of Thailand will amend a law to tax individuals with foreign income, even if that income is not brought into Thailand.

Director-General of the Revenue Department, Kulaya Tantitemit stated that the current tax law mandates individuals residing in Thailand for over 180 days per year to pay taxes on foreign income if it is brought into the country.

This income is currently subject to personal income tax payments to the department. The department is now working to amend the law based on the principle of worldwide income.

This principle taxes individuals based on their residency within the country, irrespective of whether the income is sourced domestically or internationally.

Kulaya mentioned plans to expand the tax base by requiring platforms with an income of 1 billion baht or more to report their sources of income.

She added that the department will use this information to verify their tax compliance.

Previously, the department revised the criteria for tax residency, mandating that individuals residing in Thailand for at least 180 days per year and earning foreign income must pay personal income tax if that income is brought into the country within the same year it was earned.

However, this rule will be revised again, effective from 2024, requiring tax payment on foreign income regardless of when it is brought into the country, reported Bangkok Post.

In related news, in a recent press conference, Thailand’s new Tourism and Sports Minister, Sermsak Pongpanich, hinted at the impending introduction of a tourist tax, known as the Kha Yeap Pan Din, translating to a landing fee.

Although no specific timeline was provided for its implementation, the newly-appointed minister emphasised the unlikelihood of abandoning the proposed tax.

In separate news, the Finance Ministry anticipates the land and building tax collection to reach 43 billion baht this year, marking an increase of 8 billion from the previous year due to the discontinuation of the tax discount.