Amendments to the Tax Code dated March 21, 2019.

On March 21, 2019, the Law “On Amendments to the Tax Code” (No. 48) came into force, affecting individuals who regularly receive funds into their accounts in Thailand.

The new rules apply in the following cases.

— When an individual receives funds into their account or makes deposits, if the number of transactions exceeds 3,000 per year.
— When an individual receives funds into their account or makes deposits, if the number of transactions exceeds 400 with a total amount exceeding 2 million THB per year.

In such cases, information on all account transactions for the year must be submitted to the tax authority by the end of March of the following year.

The obligation to report such transactions lies with the following entities.

(1) Financial institutions under the law on financial institutions.
(2) State financial institutions established under specific laws.
(3) Electronic money service providers under the law on electronic payments.

The Ministry of Finance was required to define the exact list of data to be submitted to the tax authority by the end of August 2019.

Please note that if the tax authority receives information that an individual earned income of 2 million THB per year, the tax payable would be approximately 365,000 THB, based on progressive tax rates and standard deductions.

For many, this creates a reason to consider company registration, especially if the funds are related to business activity. Firstly, the tax base can be significantly reduced through business expenses. Secondly, even without deductions, corporate tax on 2 million THB would amount to 255,000 THB.

Of course, there are many nuances, such as VAT, which becomes mandatory for businesses with turnover exceeding 1.8 million THB, or situations where income is received as salary with tax already withheld. Now is the right time to consider these aspects carefully.

For all questions related to personal taxation in Thailand, please contact +66 87 348 5703.