For filing of Thai personal income tax returns with the Thai Revenue Department, these are the cases where foreign-based income is not subject to Thai taxes.
If foreign-sourced income derived before 1st January 2024 and remitted into Thailand in a later tax year
Foreign-sourced income is derived by a foreigner who is NOT a Thailand tax resident but later remitted such income into Thailand
A foreigner is considered a tax resident of Thailand if he/she has stayed in Thailand for at least 180 days during the calendar year and has derived income either within Thailand or outside Thailand.
Moreover, foreigners must include both income sourced within and outside Thailand in the filing of his/her Thai personal income tax return. Taxable income shall be an aggregate amount of Thai-sourced income earned during the tax year and foreign-sourced income remitted to Thailand during the tax year. Hence, if foreign-sourced income is remitted partially, the taxable amount shall be apportioned accordingly.
MSNA can help Thai tax residents compute and submit their personal income tax returns. Contact us now for getting tax ID card, filing the tax returns and obtaining Tax Residence Certificate or Income Tax Payment Certificates.
When a foreigner who is a tax resident of Thailand pays tax on his income abroad, the amount of paid tax can be credited against the tax payable in Thailand. This is applicable only if the country has a Double Tax Agreement (DTA) with Thailand. In this case, there will be no double taxation for tax residents of Thailand.
The amount of tax that can be credited should not be higher than the amount of Thailand’s tax liable to the foreign-sourced income.
To use this foreign tax relief, the Revenue Department may require documents and evidence to prove sources of income and to claim foreign tax credit under DTA. Such documents must be in English or Thai. For the supporting documents to claim foreign tax credit, Tax Payment Certificate issued by the foreign tax authority is recommended.
Contact MSNA for personal income tax computation, filing of tax returns and getting Income Tax Payment Certificate or Tax Residence Certificate in Thailand.
There is a Double Tax Agreement (DTA) between Thailand and Myanmar. Currently, Thailand has concluded tax treaty agreements with 61 countries, including Myanmar. The other countries are:
Armenia, Australia, Austria
Bahrain, Bangladesh, Belarus, Belgium, Bulgaria
Canada, Cambodia, Chile, China Peoples Republic, Cyprus, Czech Republic
Denmark
Estonia
Finland, France
Germany, Great Britain and Northern Ireland
Hong Kong, Hungary
India, Indonesia, Ireland, Israel, Italy
Japan
Korea, Kuwait
Laos, Luxembourg
Malaysia, Mauritius
Nepal, the Netherlands, New Zealand, Norway
Oman
Pakistan, the Philippines, Poland
Romania, Russia
Seychelles, Singapore, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland
Taiwan, Tajikistan, Turkey
Ukraine, United Arab Emirates, United States of America, Uzbekistan
Vietnam
MSNA provides consultation on Thai taxation and tax filing services. We also assist individual taxpayers prepare and submit their Thai personal income tax returns and obtain a Tax Residence Certificate, if needed.
One of our clients that is engaged in trading business has recently registered its branch into the VAT system with the Revenue Department. Now, they have 2 VAT registration certificates, one for the main office and another one for its branch. Today, they asked us which one to use and when it should be used.
Our reply:
When you buy things for the head office, you need to tell the supplier to issue their tax invoice to your head office. And when you buy things for your branch, then the supplier should issue their tax invoice for the branch.
The tax invoice issuer should put the word “head office” or “Branch No.1” on the tax invoice for you.
Contact MSNA for accounting and tax filing needs. Thai Lawyers can help you register your company and your branches into the VAT system.
According to Section 41 of the Revenue Code of the Thai Revenue Department, foreigners have the duty to file their taxes in Thailand as below:
Income derived in Thailand
If a foreigner has income from sources within Thailand either by employment, own business or assets located in Thailand, such income is subject to income tax whether such income is paid within or outside Thailand.
Income derived outside Thailand
If a foreigner has income outside Thailand, such income is subject to Thailand income tax if these two conditions are met:
Such income has been incurred in any tax year starting from 1 January 2024 onward by a foreigner who stays in Thailand for 180 days or more in a tax year, and;
Such income earned from 1 January 2024 has been remitted or brought into Thailand (whether wholly or partially) in any tax year from 2024 onward
For instance, a Burmese who lives in Thailand for at least 180 days in 2024 with income from Myanmar or another country brings the money earned before 2024 into Thailand in 2024, then it will not be taxed. If he/she brings the money earned in 2024 into Thailand in 2025, then it will be taxed in 2025. However, if he/she has income earned outside Thailand but he/she is not a tax resident in Thailand and brought or remitted such income into Thailand later, it is not subject to Thai tax because he/she did not stay in Thailand for 180 days or more during the tax year.
Tax Returns to be Filed
If he has income derived from employment in Thailand only, he must submit the personal income tax return P.N.D. 91.
If he has income derived within Thailand and outside Thailand or just from outside Thailand, he must submit the personal income tax return P.N.D. 90.
MSNA Group can not only help Burmese people on how to do business in Thailand, we can also help you with Thailand taxes. If you need assistance in filing your personal income tax returns in Thailand, you come to the right place. Contact us now for more information.
Today, a client whom we helped register a 100% Myanmar owned export company in Thailand asked us if it is necessary for them to be registered in the VAT system. Here is our response:
Normally, a company is required to register into the VAT system if the gross sale has reached 1.8 million Baht in a year or the company hires foreigners and needs to apply for a work permit because the VAT registration certificate is one of the documents requested by the Thai immigration bureau. Anyway, the company may choose to register into the VAT system before that. And once you are registered into the VAT system, you have to submit your monthly VAT returns (PP.30) with or without sale transactions. You can decide to apply for VAT refund from the Revenue Department later but keep in mind that the tax officer will request to see all supporting documents before giving you the refund.
Thai Lawyers can help you register the company into the VAT system. MSNA Group can handle bookkeeping, accounting, tax filing and consultation on Thai taxes. We will ensure that you’re your documents are properly kept in files for easier reference when tax authorities request to see them. We can also assist you in representing your company with the Revenue Department especially when you apply for VAT refund. However, we will not be responsible to speed up the process because it is up to the tax officials when they can finish checking your documents and consider your application to claim VAT. You may find helpful information on what to do once a company is registered in the VAT system, and how withholding taxes in Thailand work.
In one of our previous posts, we talked about personal allowance for parents that is allowed for the computation of Personal Income Tax and filing with the Revenue Department. However, only Thai citizens can use parents allowance for computation of Thai Personal Income Tax.
In this article, we would like to explain that if you and your spouse (who is not working and has no income) support your parents, you may use a parental care allowance of THB 15,000 for each qualified parent given that they meet the following conditions:
You/your spouse is a legitimate child (not adopted) of the parent
At the end of the year, either of your mother and father is at least 60 years of age and must be under your care and financial support
Your qualified parent must not have assessable income exceeding THB 30,000 (including exempted income)
For each qualified parent you are claiming the allowance, you must provide a Parental Care Certificate showing their personal Identification Number and the amount of the allowance. However, if you have a sibling who is also supporting your parents, only one can claim for a parental care allowance.
On the other hand, if you are a non-Thai taxpayer, you can claim for parental care allowance if your qualified parent is a Thai citizen.
Contact MSNA for assistance in filing your personal income tax returns in Thailand.
The Double Taxation Agreement or DTA is a tax treaty between 2 countries. Currently Thailand has double taxation treaties with 61 foreign countries which cover taxes on income and capital of individuals and juristic entities.
In order to be considered a Thai tax resident and be entitled to treaty benefits, a tax payer must be one of the following:
An individual who stays in Thailand for a consecutive 180 days or more in a tax year;
A juristic person who is registered under the Civil and Commercial Code of Thailand
A Double Taxation Agreement applies to only income taxes such as personal income tax, corporate income tax and petroleum income tax. Other indirect taxes such as the Value Added Tax (VAT) and Specific Business Tax (SBT) are not covered by the DTA. Although the DTA does not specify any specific amount of income and tax rate in general, it prescribes whether the source or resident country is entitled to tax on certain income. If the source country has taxing rights, the income will be taxable according to the domestic laws of that country.
A Double Taxation Agreement also stipulates a tax rate level on investment income such as dividends, interests and royalties. Therefore, the source country can tax such income at a rate not exceeding the rate prescribed within the treaty. Normally, the tax rates within the DTA are lower compared to the domestic tax rates in order to decrease tax impediments to cross border trade and investment. However, some articles of the DTA clearly do not accept the source country to exercise taxing rights on income such as income from international air transport and business profits provided that the business is not carried through a permanent entity in the source country.
In general, Thai double taxation treaties place a resident of the foreign country in a more favorable position for Thai tax purposes than under the domestic law, for example, the Thai Revenue Code of the Revenue Department. It provides income tax exemption on business profits (industrial and commercial profits) earned in Thailand by a resident of a foreign country if it does not have a permanent establishment in Thailand. In addition, the withholding taxes on payments of income to foreign juristic entities not carrying on business in Thailand may be reduced or exempted under the double taxation treaties.
Thai taxation has a unique tax structure thus, consulting with Thai tax experts is highly recommended. Consult with MSNA Group, for the best Thai tax advice.
In one of our previous posts, we talked about Tax Clearance Certificate, which is a certificate issued by the Revenue Department to a non-Thai tax resident who is departing Thailand to indicate that he has already paid taxes or that he has provided a guarantor or securities as guarantee for tax liabilities and tax payable. In this post, we want to give more information about the types of tax clearance certificate in Thailand.
There are 2 types of Tax Clearance Certificate:
P. 3 Tax Clearance Certificate
This is issued to a foreigner who is temporarily departing Thailand. It is valid for a single departure and must be used within 15 days from the issuance date. If he/she could not depart Thailand within the specified period, P.3 Tax Clearance Certificate becomes invalid unless he/she renewed it before the expiry date.
P.3.1 Tax Clearance Certificate
This is issued to a foreigner who enters and leaves Thailand on a regular basis due to his/her business or profession. It is valid for multiple departure within the specified period in the Tax Clearance Certificate but not exceeding 180 days from the issuance date. P.3.1 Tax Clearance Certificate cannot be renewed.
Consult with MSNA how to get a Tax Clearance Certificate.
