November 3, 2025
Under Thailand’s Revenue Department Instructions No. Paw 161/2566 and No. Paw 162/2566, which clarify the interpretation of Section 41 paragraph 2 of the Revenue Code concerning the personal income tax treatment of offshore income earned by Thai tax residents, the Revenue Department has confirmed that the revised interpretation will apply to income arising from 1 January 2024 onwards.
1. Legal Basis under Section 41
• Income from work, business, or property in Thailand is taxable whether paid in or outside Thailand.
• A Thai tax resident (someone residing in Thailand for 180 days or more in a tax year) must pay Thai income tax on income arising abroad once it is brought into Thailand.
(*Historically, if the foreign income was not remitted within the same year it was earned, it was exempt from Thai tax)
2. Key Clarifications
3. Who Is Affected
The clarification applies to all Thai tax residents, including:
• Thai nationals and expatriates working in Thailand - Any offshore income, such as foreign salaries, consulting fees, or investment returns, will now be taxed once brought into Thailand. Individuals accustomed to keeping overseas income untaxed by delaying remittance will lose that benefit.
• Thai citizens working abroad - Income earned overseas and remitted home for family expenses or savings will fall within the Thai tax net. Proper foreign-tax-credit claims under double-tax treaties will become essential to avoid double taxation.
• Remote workers and freelancers residing in Thailand - Those who perform services for foreign clients while physically in Thailand will be treated as Thai-source income or foreign-sourced income remitted, both of which are taxable.
• Retirees and long-term residents - Pension income or investment proceeds remitted from abroad will be taxable in the year of remittance. Retirees should review how they transfer living expenses to Thailand each year.
• Foreign entrepreneurs and shareholders establishing or funding businesses in Thailand - Large capital remittances for company formation, project funding, or land acquisition may raise scrutiny from the Revenue Department if they resemble personal income inflows.
4. Types of Income Covered
• All offshore income derived by Thai residents is now in scope, such as:
• Employment or professional income from abroad;
• Dividends, interest, rental income, and capital gains;
• Bonuses and equity compensation from foreign parent companies.
5. Recommendations
With the Revenue Department’s interpretations under Paw 161/2566 and Paw 162/2566 now fully effective, the 2024 tax year marks the first period in which offshore income remitted into Thailand must be reported under Section 41 of the Revenue Code. To avoid unnecessary tax exposure, taxpayers should focus on demonstrating that the remitted funds are not within the scope of assessable income, but rather constitute non-taxable capital, such as equity injections, shareholder loans, or previously taxed income abroad. Proper documentation—such as bank records, source-of-fund evidence, share subscription agreements, and corporate resolutions—is essential to prevent misclassification and unnecessary tax assessments.
As Thailand strengthens financial transparency under the OECD Common Reporting Standard (CRS), the Revenue Department can increasingly trace large inbound transfers. Strategic planning and accurate documentation are now critical. At CY Law Offices, we assist clients in structuring, reviewing, and documenting remittances to ensure that capital injections and other transfers are recognized as non-taxable funding. For consultation or individual assessment, please contact us at contact@cylaw.co.th
