Tax in Thailand

All resident and non-resident individuals earning income from sources in Thailand are subject to personal income tax (PIT). A Thai resident is also subject to PIT on self-employment and business income from sources overseas if the income is remitted to Thailand.

Individuals are considered resident if they reside in Thailand for a period or periods aggregating 180 days or more during a calendar year. Income earned overseas by Thai residents from 1 January 2024 onward is also subject to PIT if it is remitted to Thailand in the year it is earned or in subsequent years.

Taxable income consists of assessable income, less deductible expenses and allowances.

Employment income - All benefits derived from employment are assessable, unless expressly exempt by law. Examples of assessable benefits are wages, salaries, per diem allowances, bonuses, bounties, gratuities, directors’ fees, pensions, house rental allowances, the monetary value of rent-free accommodation provided by an employer, and income tax paid and borne by an employer on behalf of an employee.

Self-employment and business income - Taxable self-employment and business income consists of assessable income less deductible expenses and allowances. Generally, all types of income are assessable unless expressly exempt by law.

Investment income - Interest, dividends and other investment income are subject to PIT at the applicable rates.

A tax credit is granted for dividend income received by an individual domiciled in Thailand from locally incorporated companies.

Taxation of employer-provided stock options - Employees are subject to tax on the benefit derived from shares provided either for free or at a favourable price by the employer. The taxable benefit is the difference between the price paid by the employee, if any, and the fair market value of the shares.

Gains derived from sales of shares are generally subject to PIT. However, gains derived from sales of securities listed on the Stock Exchange of Thailand are exempt from tax.

Gains derived from sales of real property are subject to PIT. A standard allowance is deductible, depending on the number of years of ownership. This tax also applies to gains derived from sales of real property used in a trade or business.

PIT normally is levied on assessable income earned during a calendar year. However, the tax authorities may reassess income tax based on net worth if the amount of a taxpayer’s income is believed to be understated. In practice, this power is rarely exercised.

Under the Inheritance Tax Act, inheritances received are taxable only on the accumulated value in excess of THB 100 million per benefactor, at a rate of 5% in the case of descendant or parents or 10% in all other cases. The tax filing must be completed within 150 days from the date of receipt or penalties and surcharges are applied.

In general, gifts are taxed at a flat rate of 5%. However, gifts received from a legitimate parent, child or spouse (up to THB 20 million per year) or in a ceremony or on occasions in accordance with custom and tradition (up to THB 10 million per year) are exempt from tax.

The social security contribution rate is 5% on a capped remuneration of THB 15,000 per month. As a result, the contribution is capped at THB 750 per month and THB 9,000 per year.

PIT payable by employees is withheld by employers. Some self-employed individuals, including certain professionals and those engaged in the rental of property, must make an interim income tax payment in September.

Self-assessed income tax must be paid on the filing date.

Thailand has entered into double tax treaties with 61 countries. The method of eliminating double tax varies by treaty.