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Filing your tax return for resident expats in Thailand

Business & Travel

Filing your tax return for resident expats in Thailand

This post is also available in: English

Are you an expat working for a local Thai company in Thailand? Did you know you can file your tax returns and claim some tax back? This is possible provided you are a resident in the country, have a Tax ID, have secured local health and/or life insurance plans, or are eligible for other tax allowances for that tax year. 

Fulfilling the above criteria and more means you could claim back a certain amount you have paid from your income for that particular tax year. Wonderful news, right? To learn more, our friends at Pacific Prime Thailand will explain what personal income tax is, and touch on why securing health insurance can help reduce your taxable income. 

What you need to know about Personal Income Tax (PIT) in Thailand

In Thailand, the revenue department defines Personal Income Tax (PIT) as a direct tax levied on the income of a person working in or for a business registered with the Revenue Department in the Kingdom of Thailand. Just like other countries with a proper tax system, tax is typically levied on your income before you receive your net pay (net personal income). Therefore, PIT is applied to all that are employed in a corporate multinational organization, small to large SME, and even those working as freelancers, for instance, digital nomads. 

The tax rates in 2021 for employment income are as follows:

If you are unsure about which salary band you fall under, then you are encouraged to speak to your accounting department or manager to find out more. Freelancers or those that are self-employed in Thailand can hire an accountant or contact the Revenue Department to find out more information.

Resident vs. non-resident

According to Thailand’s Revenue Department, taxpayers are typically classified as “resident” or “non-resident”. “Resident” is any person that has resided in Thailand for 180 consecutive days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand, as well as income into the country that is derived from foreign sources. However, a non-resident is subject to tax only on income from sources in Thailand. 

Based on the above criteria, expatriates in the country are generally considered as residents living and working long-term. If you are unsure about your status or would like confirmation, then speaking to your Thai employer or reaching out to the immigration office can help provide confirmation. 

Register for a tax identification number (TIN) in Thailand

Before or at the start of your employment in Thailand, you have to register for a TIN from the Revenue Department. The TIN comprises 10 digits and is used when filing for your tax return or tax relief.

For expats employed in Thailand, here is an overview of the process.

  • To apply for a TIN, the standard application form for expats to fill out is L.P. 10.1 for individuals. There are also other types of forms depending on your status. You are advised to consult the Revenue Department’s Tax Identification page to decide which form matches your status. 
  • The main supporting documents required include but are not limited to a photocopy of the alien certificate, passport, and house registration book. See the Tax Identification page for more on the requirements. 
  • Once you have filled out the correct form and gathered all your documents, you can visit one of the many tax offices in the country to apply. For more information and guidance you are encouraged to speak to your accounting department for help going about your application for a TIN.

The tax year in Thailand

In Thailand, the full tax year runs from January 1st to December 31st. You must pay any due tax to the Revenue Department by March 31st for each previous tax year. For instance, tax filing has to be done before March 31, 2022, for the previous 2021 tax period. Normally PIT is deducted before receipt of wages or salaries when processed by your accounting or payroll department.

Securing health insurance for private healthcare and reducing taxable income in Thailand

In Thailand, health insurance is considered a must-have for any expat, especially someone who has a spouse and family. Should the worst happen, you can use your health insurance plan to cover the immediate medical costs and apply any benefits that are on your plan. 

Private healthcare vs. public healthcare

Private hospitals, when compared to most public hospitals are superior in service, expertise, and quality. You can expect to be seen right away and given a full diagnosis of your medical issue within a short period. You needn’t worry about waiting in long queues for hours on end like in most public hospitals, and direct billing ensures your insurer picks up the bill and nothing gets paid out of your pocket. Some of these hospitals include Bumrungrad, Bangkok International, Samitivej, BNH, and others that can be found in Bangkok and other major cities nationwide.

Reduce taxable income in Thailand

Just like many countries that operate a proper tax relief system, the health insurance premium you pay for health coverage in the country can be used as a form of tax allowance. This is why expats are encouraged to secure a health insurance plan in Thailand as it serves many purposes – one of them being tax relief.

The Thai government allows buyers of health insurance plans to submit their policy to the Revenue Department, to claim back a sum amount of tax paid. This applies to both locals and expats that are residents and pay taxes in Thailand. The amount varies depending on the premiums paid and other allowances that you can submit for.

The maximum health premium allowed for tax allowance 

The Revenue Department allows premiums of up to THB ฿ 25,000 per annum to be used as a tax allowance for health insurance.

(Take note: Expatriates can use either a life insurance or health insurance policy, or both to submit as tax allowance, but the total must not surpass THB ฿ 100,000) 

Secure health insurance with Pacific Prime Thailand

If you are interested in being able to claim back tax next year in 2022, why not reach out to Pacific Prime Thailand and get a free health insurance quotation? 

They have over 20 years of experience helping expats find health insurance coverage in Thailand, and are capable of finding the best local, international, or expat health insurance plan that balances your needs and budget. 

Contact them today.

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