The facts about the ‘new’ tax on expat income – Updates below
Expat News has been following the change in Thai tax law related to taxing foreigner income that is brought into Thailand. We have seen a great deal of misinformation online, as well as a good bit of defiance. So we asked experts on the subject, Here is what was provided by Expat Tax Thailand:
In September 2023, Thailand’s Revenue Department announced significant updates to the interpretation of tax laws, effective from Jan. 1, 2024. These changes, now officially published in the Royal Gazette, have raised questions and concerns among expats, many of whom are unsure about their obligations under the new rules. With the 2024 tax filing deadline fast approaching, understanding these changes is essential.
To provide clarity, Expat Tax Thailand (ETT) has partnered with experts from the Revenue Department and leading tax specialists. These include Pattharaphon Penjham, senior legal officer at the Revenue Department, and Thanadet Boonsantia, managing director of Tax Talk Thailand. Their guidance sheds light on what expats need to know to stay compliant.
Addressing the Most Pressing Questions
1. Is this new tax official?
Yes, the updated tax regulations were officially published in the Royal Gazette in September 2023, confirming their validity. The rules came into effect on Jan. 1, 2024, and apply to income remitted into Thailand from this date onward.
According to Carl Turner, co-founder of Expat Tax Thailand, “These updates represent a major shift in how expats need to approach their tax filings. It’s important to act now to ensure compliance and avoid unnecessary penalties.”
2. Do all expats need to file a Thai tax return, even if their home country has a dual tax treaty (DTA)?
Expats are required to file a Thai tax return if their income is not explicitly excluded under a DTA. Paying tax in another country does not automatically exempt you from filing in Thailand. For example, U.S. Social Security payments may still require filing if remitted to Thailand and not excluded by a DTA. Immigration officials are unlikely to handle foreign tax treaties directly and may default to asking for a Thai tax return during visa renewals.
(Expat News: From the US-Thailand dual tax treaty – “social security benefits and other similar public pensions paid by a Contracting State to a resident of the other Contracting State or a citizen of the
United States shall be taxable only in the first-mentioned State.)
Update
Expat News received a question about who has to file a tax return, particularly concerning government retirement programs from their country, such as U.S. Social Security or Canadian pensions. Here is the response from Expat Tax Thailand:
“People with no assessable income do not need to file. (so U.S. Social Security, Canadian pensions). For other pensions if they have paid tax in another jurisdiction then they have to file and can use tax paid as a tax credit. Here is a link to our assessment.https://hhexpatnews.com/expat-tax/
“Many expats mistakenly believe that having paid tax overseas means they don’t have to file in Thailand,” says Turner. “The reality is more complex, and professional guidance is often necessary to ensure compliance.”
3. When is this enforced? What happens if someone hasn’t filed a tax return?
The new rules are already in effect, and failure to comply can have serious consequences. If you are obligated to file a Thai tax return and do not, the Revenue Department has the authority to audit you. This may result in:
- Notification to immigration authorities, potentially preventing you from exiting Thailand.
- Police notices and legal proceedings.
Turner emphasizes, “The Revenue Department has been clear about its enforcement powers. Non-compliance could lead to significant disruptions, including visa or travel issues.”
4. Is this a scam by tax experts and accountants?
No, the changes are directly from Thailand’s Revenue Department and are not a scheme created by tax professionals. The updated regulations are based on official policies, and experts have worked closely with the Revenue Department to provide accurate information. To further clarify, a webinar featuring Revenue Department officials and tax specialists is being offered to answer questions and provide guidance directly from credible sources. Register to join the live Q&A with the Revenue Department here.
Turner notes, “At Expat Tax Thailand, we base our advice on information directly from the Revenue Department. Our goal is to demystify the process and provide expats with the tools they need to stay compliant.”
Key Tax Changes for Expats
Under the new rules, expats residing in Thailand for more than 180 days must file a tax return if they remit the following types of income into Thailand after Jan. 1, 2024:
- Salaries earned overseas.
- Pension income.
- Capital gains from investments.
- Rental income from overseas properties.
Funds brought into Thailand before 2024 (e.g., savings or social security payments) are not taxable, provided you maintain proper documentation.
Staying Compliant: Practical Steps
- Understand your obligations: Determine whether your income qualifies as taxable under the new rules.
- Consult resources: Refer to the Revenue Department’s English-language guide, “How Foreigners in Thailand Pay Tax,” for detailed information.
- Maintain records: Ensure proper documentation for all remittances, including bank slips and sales records, especially for non-taxable income.
- Seek expert advice: Engage trusted advisors to navigate the complexities of these regulations and ensure compliance.
A Note on Enforcement
With the 2024 tax filing deadline of March 31, 2024, time is running out for expats to organize their filings. Penalties for non-compliance include fines, visa or work permit issues, and other complications. By staying informed and proactive, expats can meet their obligations and avoid unnecessary difficulties.
Hua Hin Expat News offers a unique link for further information, where Expat Tax Thailand and tax experts are available to provide clarity and answer questions directly – HERE.
A live “Ask the Revenue Department” webinar is scheduled for next week, Jan. 29, at 4pm. This is an opportunity to have your tax questions answered directly by Pattharaphon Penjham, senior legal officer at the Thailand Revenue Department. He will be joined by Thanadet Boonsantia, managing director of Tax Talk Thailand and a former Revenue Department official turned independent tax expert. Together, they will provide valuable insights into how recent tax changes impact expat tax residents. Sign up here.
Updates
Nightmare scenario at PKK tax office over new expat tax
“I just returned from the Prachuap Khiri Khan tax office at the Prachuap provincial office (Not Hua Hin). I had my total amount that was transferred to fill in their forms, as well as proof the the monies were from Social Security office.
“While speaking to the personnel, they asked my wife where did my money come from. My wife showed them my form 1099 that showed how much was paid to me from the SSI. They then told her that all of that income on that piece of paper would be taxed and I would need to pay thousands on it to their office. I tried to explain to them (with wife’s help in Thai) that the DTA for SSI to Thailand is not taxable.” Continued …
Editor: Hua Hin Expat News‘ understanding of this issue, as explained by tax experts, is that American Social Security payments, Canadian pensions, and similar income is not subject to the new tax. Furthermore, we have been advised that is not even necessary to file a tax return or report the income, based on existing tax laws. We have been concerned, however, that local tax authorities lack the necessary knowledge to implement the new tax guidelines, as can be shown in the above example. Expat News has an exclsive review of the new expat tax HERE, including a link to ask your questions.
RE: Nightmare scenario at PKK tax office over new expat tax
“Thank you for the article ‘Nightmare scenario at PKK tax office over new expat tax‘ and thank you ‘Thesatat’ for being a ‘pipe cleaner’ trying to be a good person and file taxes in PKK. The head of the PKK tax office personally promised us at a meeting in Hua Hin that “All DTAs will be honored.” Clearly, he hasn’t shared that with his subordinates. Personally, I’m going through AIT (American International Tax Advisors) and let them deal with these issues. At the end of the day (which may be two to three years out – maybe more – we hope to pay only what is legally required.” – PB
Editor: We have asked the tax consultants we used for our previous reporting to assess this latest news, but this is probably just a lack of understanding on the part of local officials about the tax. We anticipated this might be a problem early on, as the law is ambiguous and there are roughly 90 dual tax treaties to be considered, not all the same. We doubt, at this stage, that there has been any education of local officials, and even if there is, the complications might make them resort to an “everyone has to pay the tax” mentality. There will probably be a lot of misinformation on this issue as we go forward and we will try to keep you informed as we hear about problems or solutions. Getting expert guidance as you have done is probably a wise move.
Here us the response from Expats Tax Thailand’s experts: “The key issue here is not just U.S. Social Security but the broader challenge of how international tax rules are applied at the local level in Thailand. The 2024 remittance tax changes have introduced complexities that some local tax offices — especially in provincial areas — may not yet fully understand. Many expats have reported difficulties due to inconsistent guidance, as well as language barriers when trying to clarify their tax position.
“In cases like U.S. Social Security, the rules are clear: it is not taxable in Thailand, nor does it need to be included on a Thai tax return. However, misunderstandings at the local level can lead to unnecessary stress and potential disputes with tax authorities.
“For expats looking to avoid these difficulties, using a professional tax filing service can help ensure compliance while avoiding the frustration of dealing with tax offices unfamiliar with international tax agreements.”
Click HERE if you have more questions.