Key Information on Revenue Department Order No. 162/2023
Additionally, to the Q & A paper on the new tax regulations published by the Thai Revenue Department, the Thai Tax Authority published the Revenue Department Order No. 162/2023 on 20. November 2023.
This order states, that the following paragraph shall be added to the Revenue Department Order No. 161/2023 regarding income tax payment according to Section 41, paragraph two of the Revenue Code, dated September 15, 2023:
“The provision in paragraph one shall not apply to assessable income arising before January 1, 2024.”
This is an important clarification, because it means that for income that was received before this date, the old rules still apply. This order shall take effect for income brought into Thailand starting from January 1, 2024. This means it applies to income assessable from foreign sources at the domicile of the income earner from the tax year 2024 onwards. Therefore, for income from foreign sources generated before the tax year 2024, the previous principle still applies: the income must be brought into Thailand in the same tax year it is earned, and individuals are not required to pay personal income tax according to the Revenue Code. This is because it does not comply with the traditional interpretation.
Why this new amendment is important shows the following example:
A person is living in Thailand for more than 180 days a year but receives income outside of Thailand since the last 10 years and transfers this money into Thailand. Starting from 01. January 2024, this income will be subject to tax regardless of when it was earned. Due to the new clarification, the taxation does not apply to income he is transferring into Thailand, if he can prove that the income was earned before 2024.
Before this Order 162/2023, the regulations could be read that he has to pay taxes starting from 2024 on any income he is transferring into Thailand, regardless of when it was earned. This assumption is now corrected. Income that was earned in for example 2020 can still be transferred into Thailand after 01. January 2024, without being subject to tax, if it can be proved that this income was earned in 2020.