Buying a house or buying land and building a “dream house” in Thailand are quite similar. They share the following options.
1. Freehold for Thai Nationals (Land is in the Thai Nationals own name).
2. Mortgage-hold for Thai Nationals (Land is held by a Thai National or Foreigner under a registered mortgage at the Thai Government land Office).
3. Long term leasehold (Land is held by a Thai National or Foreigner under a registered Lease at the Thai Government Land Office.
4. Registered Company (The most popular method, in which a single director (the buyer) becomes the sole signatory for the company, which purchases the land as an asset).
For rental or purchase of real estate, try Fair Properties Tel: 038-303-418 and 177. They are located at 340/11 View Talay Condo ‘B’ Pattaya and www.fairproperties.com
Thailand personal income regulations
C.A.T. accounting and tax Co., Ltd. is owned and operated by khun Thananan Khomkai. They are located at 62/7 Thepprasit Rd. Tel. 038 300 642-3, 01 801 7781, Fax. 038 300 647 Email: thananan@loxinfo.co.th, www.thananan.com she and her staff do accounting and auditing tax and legal services. Administration services and apartment management. They can do small and large businesses. They do personal income tax returns. See the ad in this paper for a special discount.
Personal income tax ( PIT ) is a direct tax levied on income of a person. A person means an individual, an ordinary partnership, a non – juristic body of person, a deceased person and an undivided estate. In general, a person liable to PIT has to compute his tax liability. File tax return and pay tax, if any, accordingly on a calendar year basis.
Taxpayers are classified into “resident “ and “non – resident“. “ Resident “ means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand on a cash basis, regardless where the money is paid, as well as on the portion of income from foreign sources that is brought in Thailand. A not – resident is, however, subject to tax only on income from sources in Thailand.
Income chargeable to the PIT is called “ assessable income “. The term covers income both in cash and in kind. Therefore, any benefits provided by an employer or other persons, such as a rent – free house or the amount of tax paid by the employer on behalf of the employee, are also treated as assessable income of the employee for the purpose of PIT.
Assessable income is divided into 8 categories as follows:
1. Income from personal services rendered to employers.
2. Income by virtue of jobs, positions or services rendered.
3. Income from goodwill, copyright, franchise, other rights,
annuity or income in the nature of annual payments derived from a will or any other juristic Act or judgment of the Court.
4. Income in the nature of dividends, interest on deposits with
banks in Thailand, shares of profits or other benefits from a juristic company, juristic partnership, or mutual fund, payments received as a result of the reduction of capital, a bonus, an increased capital holdings, gains from amalgamation, acquisition or dissolution of juristic companies or partnerships, and gains from transferring of shares or partnership holdings.
5. Income from letting out of property on hire and from breaches of installment sales or hire – purchase contracts.
6. Income from liberal professions.
7. Income from construction and other contract of work.
8. Income from business, commerce, agriculture, industry,
transport or any other activity not specified earlier.
Certain deductions and allowances are allowed in the calculation of the taxable income. Taxpayers shall make deductions from assessable income before the allowances are granted.
Therefore, taxable income is calculated by
TAXABLE INCOME = assessable income – deductions – allowances
Any taxpayer who domiciles in Thailand and receives dividends from a juristic company or partnership incorporated in Thailand is entitled to a tax credit. In computing assessable income, a taxpayer shall gross up his dividends by the amount of the tax credit received. The amount of tax credit is then creditable against his tax liability.
Tax credit = dividend x corporate tax rate/(100 –corporate tax rate)
There are several types of income that the taxpayer shall not include or may not choose to include such income to the assessable income in calculating the tax liability.
Taxpayer shall not include income from sales of immovable property acquired by bequest or by way of gift to the assessable income when calculating PIT. However, if the sale is made for a commercial purpose, it is essential that such income must be included as the assessable income.
Interest income may, at the taxpayer’s selection, be excluded from the computation of PIT provided that a tax of 15 percent is with held at source. However, the following forms of individual’s interest income are exempt from 15 percent withholding tax.
1. Interest on bonds or debentures issued by a government
organization.
2. Interest on saving deposits in commercial banks if the
aggregate amount of interest received is not more than 20,000 Baht during a taxable year.
3. Interest on loans paid by a finance company.
4. Interest received from any financial institutions organized by
a specific law of Thailand for the purpose of lending money to promote agriculture, commerce or industry.
Taxpayer who is a resident in Thailand and receives dividends or shares of profits from a registered company or a mutual fund which tax has been withheld at source at the rate of 10 percent, may choose to exclude such dividends from the assessable income when calculating PIT. However, in doing so, taxpayer will be unable to claim any refund or credit as mentioned in 2.3.
For certain categories of income, the payer of income has to withhold tax at source, file tax return (from PIT 1,2, or 3 as the case may be) and submit the amount of tax withheld to the District Revenue Office. The tax withheld shall then be credited against tax liability of a taxpayer at the time of filing PIT return.
Taxpayer is liable to file Personal Income Tax return (from PIT 90 or 91 ) and make a payment to the District Revenue Office within the last day of March following the taxable year.
Taxpayer who derives categories of income (5) – (8) during the first six months of the taxable year is also required to file half – yearly return ( from PIT 94) and make a payment to the District Revenue Office within the last day of September of that taxable year.
Any withholding or half – yearly tax, which has been paid, can be used as a credit against the tax liability at the end of the year.
If his bores you or if this causes you stress or concern or you want help with your taxes, business or apartment, call “ TK “. She will take this burden from you and do a professional job. You will be so glad, you did.
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