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Personal Income Tax

Both residents and non-residents need to apply for a personal income tax ID.

 

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Residents have to pay taxes on all income resulting from:

  1. Income realized in Thailand, in cash or in kind (paid in or outside Thailand)

  2. Income from a foreign source that is brought into Thailand within the year

Non-residents are subject to personal income tax on income generated in Thailand.

The assessable income is classified into eight categories:

  1. Income from wages and salary, including the benefits provided by an employer (e.g. income from stock options, personal income tax paid and absorbed by the employer, living allowances, monetary value of rent-free accommodation, etc.), but excluding business travel expenses and medical treatment

  2. Income from services, hire of work or office of employment

  3. Income from royalties (goodwill, copyright, franchise, patents or other rights)

  4. Income from dividends, interest (e.g. on deposits with banks in Thailand), capital gain, bonuses for investors, acquisition or dissolution of companies or partnerships, etc. However, this does not include the share of profits obtained form a non-juristic body of persons or from the sale of investment units in a mutual fund

  5. Income resulting from leasing out a property and breach of a hire-purchase agreement

  6. Income resulting from liberal professions (e.g. law, medicine, engineering, accounting, architecture and fine arts)

  7. Income resulting from construction and other contracts of work, whereby the contractor provides essential materials

  8. Income from business, commerce, agriculture, industry, transport or any other activity not mentioned here above (carry-all clause). Insurance benefits, inheritances and scholarships, however, do not make part of the assessable income and are thus not subject to personal income tax

Thai law does not allow to offset capital losses against capital gains.

There are three exceptions to the taxability of the capital gains:

  1. Capital gains on the sale of shares in a company listed on the Stock Exchange of Thailand

  2. Capital gains on the sale of non-interest bearing government bonds or debt instruments (although there are exceptions)

  3. Capital gains on the sale of government bonds

Tax Rate

The personal income tax system is progressive:

Taxable Income Tax Rate
0 – 150,000 THB (189,999 THB in case of the taxpayer is older than 65 years) Exempted
150,001 – 300,000 THB 5%
300,001 – 500,000 THB 10%
500,001 – 750,000 THB 15%
750,001 – 1,000,000 THB 20%
1,000,001 – 2,000,000 THB 25%
2,000,001 – 4,000,000 THB 30%
4,000,001+ THB 35%

Can We Help?

Our lawyers, accountants and business consultants will be glad to discuss your needs and answer any questions you may have.

 

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