Tax System in Thailand

In general taxes in Thailand are low. It’s good but can cause some problems. The main problem I have with Thailand is the lack of tax income means they cannot invest in facilities which would make the country a better place.

But I’m not here to talk about that side of things but more about what you should expect to pay tax wise whilst living and working here. As with all these types of financial sections I’m not an accountant or qualified taxman so make sure to also do your own research, talk about things with an accountant if necessary and remember taxes do change overtime.

Along with the 7% VAT, you’ll pay 750 baht per month for Social Security. You’ll pay personal taxes based on your income as shown in the chart below.

 

Like other countries, you can take advantage of taxable deductions in Thailand. Popular choices include buying LTFs, paying for life insurance, and purchasing a condo. Foreign workers and Thais get the same deductions.

This includes a temporary 2017 tax deduction on purchases in malls, hotels, and restaurants registered with VAT. You could claim any purchase with a value of up to 15,000 Baht. Please check the revenue department website for more info.

To give a quick overview of how I deal with my taxes in Thailand. My income varies each month depending on the amount of work I do. But when I first arrived in Thailand I had a three-month job paying 34,000 baht a month.

That meant I paid 750 baht social security and zero taxes on the income as my yearly amount was 102,000 baht. My next job had a salary of 55,000 baht a month and after social security and tax I received around 50,050 baht. Now I earn between 68,000 to 102,000 baht and the amount I receive is around 6,000 to 8,000 baht less after paying tax and social security. My employer takes care of my taxes.

I have to sign a yearly form declaring my earnings are true and if I’d like to claim any tax back based on whether I’m married, have children, or have any tax incentive savings accounts.

For double taxation treaty countries nationals example there is one in place between the UK and Thailand. That would cover me if I was doing more freelance work or was making money on renting out properties. It’s important to see how tax affects you depending on which country you’re from and where you make your money.

If you spend more than 180 days a year in Thailand then you’re considered a tax resident and must pay tax in Thailand. If you work you’ll receive a work permit and tax ID in order to facilities income tax and social security payments. If you’re not employed then you can apply for a Tax ID from your local tax office.

Thailand does have double tax treaties with many countries, you should check with your own tax department to check on this. The Thai tax year runs from 1st January to 31st December.

As a US citizen one of the editors here at Thailand Starter Kit, handles his taxes differently. For all income made from companies outside of Thailand, he sends all his invoices to his tax service, who handles his taxes at the end of the year.

For income made in Thailand as a freelance teacher, the companies he’s contracted to work for deduct taxes from his monthly pay. Some companies deduct 3% tax, others 5% tax. He’s not taxed by the American government on his Thai salary because his Thai income is less than $103,000 a year. Since tax filing between each person is vastly different, I would recommend you to get in touch with an expert