Thailand: Offshore-sourced income received before 1 January 2024 can be brought into Thailand in 2024 or later without being subject to Thai personal income tax

29 Nov 2023    2 minute read

In brief

According to the Revenue Departmental Order No. Por. 162/2566 re: Income Taxation under section 41, paragraph two, of the Revenue Code, dated 20 November 2023 ("Order No. 162"), offshore-sourced income received by Thai tax resident individuals before 2024 can be brought into Thailand in any subsequent year without being subject to Thai personal income tax. Order No. 162 is the supplemental amendment to the Revenue Departmental Order No. Por. 161/2566 ("Order No. 161"), providing additional guidance on the same matter.

Contents

In more detail

After consulting with stakeholders, including private banks and other financial institutions, the Director-General of the Revenue Department issued Order No. 162 with the purpose of not applying the new interpretation of section 41 of the Revenue Code under Order No. 161 to offshore-sourced income received before 1 January 2024. As per Order No. 161, offshore-sourced income received by Thai tax resident individuals (i.e., any person who stays in Thailand for at least 180 days in any calendar year) will be subject to Thai personal income tax if brought into Thailand from 1 January 2024 onward. Please refer to our previous Client Alert for more details on the new interpretation under Order No. 161.

Order No. 161 and Order No. 162 collectively reveal the Revenue Department's position on Thai personal income taxation on offshore-sourced income, summarized as follows:

Offshore-sourced income Applicable interpretation Thai personal income tax consideration
Offshore-sourced income received by Thai tax resident individuals before 1 January 2024
  • Not subject to the new interpretation under Order No. 161
  • Offshore-sourced income that is brought into Thailand after the calendar year of receipt is not subject to Thai personal income tax.
 Offshore-sourced income received before 1 January 2024 can be brought into Thailand on or after 1 January 2024 without being subject to Thai personal income tax.
Offshore-sourced income received by Thai tax resident individuals from 1 January 2024
  • Subject to the new interpretation under Order No. 161
  • Offshore-sourced income that is brought into Thailand from 1 January 2024 onward is subject to Thai personal income tax.
 Offshore-sourced income received from 1 January 2024 and brought into Thailand on or after 1 January 2024 will be subject to Thai personal income tax.


What to do before 1 January 2024

For greater flexibility in bringing offshore-sourced income back to Thailand, Thai tax resident individuals may consider recognizing and receiving such income by 31 December 2023. For example, if the shareholders receive dividends paid from offshore investments or gains from the sale of offshore investments outside Thailand by 31 December 2023, they can bring these offshore dividends and gains to Thailand in or after 2024 without being subject to Thai personal income tax. Alternatively, they may consider using that offshore-sourced income to reinvest offshore. In this case, the nature of offshore-sourced income should be changed to capital or costs of investment, and only the gains recognized from the reinvestment will be subject to Thai personal income tax upon remittance to Thailand.

For further guidance, please contact our team.

Related content:

Thailand: Offshore-sourced income brought into Thailand from 1 January 2024 onward will be subject to Thai personal income tax

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