Taxable Person

In order to understand what is Income Tax (PND 90, 91, 94), we have to clarify what is a taxable person in Thailand as personal income tax is the tax on income of a person.  The Thai Revenue Code defines a person as an individual, an ordinary partnership, a non-juristic body of persons and an undivided estate, a deceased person for their assessable income and estate throughout the year in which death occurred. A person is liable to personal income and therefore must compute, file and pax tax according to the calendar year deadlines.

Any person, Thai or foreign, who resides in Thailand for a period or periods aggregating to a period of 180 days or more in any tax (calendar) year will be regarded as a resident of Thailand for tax purposes. A resident of Thailand is liable for personal income tax on income from sources inside Thailand and on assessable income derived from sources outside Thailand. However, the imposition of tax on income derived outside Thailand will apply only to income derived and brought into Thailand in the same year in which such income is earned. A non-resident is subject to pay tax only on income from sources within Thailand irrespective of the place of payment. Click here to find more details from Thailand Revenue Department.

Tax base

The tax base of personal income tax is called assessable income and it is divided in 8 categories:

  1. income from personal services rendered to employers;
  2. income by virtue of jobs, positions or services rendered;
  3. income from goodwill, copyright, franchise, other rights, annuity or income in the nature of yearly payments derived from a will or any other juristic Act or judgment of the Court;
  4. income in the nature of dividends, interest on deposits with banks in Thailand, shares of profits or other benefits from a juristic company, juristic partnership, or mutual fund, payments received as a result of the reduction of capital, a bonus, an increased capital holdings, gains from amalgamation, acquisition or dissolution of juristic companies or partnerships, and gains from transferring of shares or partnership holdings;
  5. income from letting of property and from breaches of contracts, installment sales or hire-purchase contracts;
  6. income from liberal professions;
  7. income from construction and other contracts of work;
  8. income from business, commerce, agriculture, industry, transport or any other activity not specified earlier.

Exemptions

Income specified as exempt from personal income tax is provided under the Revenue Code and by Royal Decrees issued under the Revenue Code.

Progressive tax rates

Taxable income shall be subject to tax at progressive rates ranging from 5% to 37%, with an exemption on the first Baht 150,000 of net assessable income, as follows:

Taxable income from Tax Rate Tax Amount Accumulated Tax
0 – 150,000 Exempt -0- -0-
> 150,000 – 500,000 10% 35,000 35,000
> 500,000 – 1,000,000 20% 100,000 135,000
>1,000,000 – 4,000,000 30% 900,000 1,035,000
>4,000,000 37%    

For individuals with a gross income, excluding income under Section 40 (1) of the Revenue Code, amounting to Baht 60,000 or more, the income tax payable shall not be less than 0.5% of said gross income.

Contact us for any further clarification or to request a consulting for incoming tax assistance.