The answer, as you'd expect, is… well, it depends. As a foreign national, you may stay here as a long term tourist for the duration of your tourist visa-living off your savings. Or you may be a retired person with a pension from overseas. In either case, you should not be liable to pay income tax.

But if you generate income by working in Thailand, you-just like a Thai national-may subject to personal income tax, even if the work you do is for clients based outside Thailand. Basically, if your feet are planted on Thai soil, and you do work for money while that is so, you may be liable to pay tax. (Of course, you should also have the right kind of visa and a work permit!)

Below is how the Thai tax system works for individuals

The information below is extracted from the Thai Revenue Department website http://www.rd.go.th. Shop WINDOW on Lifestyle accepts no responsibility for its accuracy at the time of going to print. Taxable persons are advised to retain the services of a competent tax advisor.

Personal Income Tax (PIT)
Personal Income Tax (PIT) is a direct tax levied on the income of a person. A person means an individual, an ordinary partnership, a non-person, a deceased person and an undivided estate. In general, a person liable to PIT has to compute his tax liability, file a tax return and pay tax, if any, on a calendar year basis.

Taxable Person
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 into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.

Tax Base
Assessable Income

Income subject to 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, 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 contracts of work
   
8. Income from business, commerce, agriculture, industry, transport or any other activity not specified earlier.
   

Deductions and Allowances

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.

Tax Rates
Progressive Tax Rates

Personal income tax is calculated in much the same way as it is in most Western countries. Rates are progressive, with the highest rate of tax being 37% applied to the last "slice" of income. Rates are as follows

Personal income tax rates applicable to taxable income are as follows, and are applicable to Taxable Income (after deductions and allowances).

Withholding Tax (WHT)
For certain categories of income, the payer of income has to withhold tax at source, file a tax return and submit the tax withheld to the Revenue Office. The tax withheld is credited against tax liability of a taxpayer at the time of filing PIT return. Withholding tax rates vary. Some examples are:

Tax Payment
Taxpayers are liable to file a Personal Income Tax return and make a payment to the Area Revenue Branch Office within the last day of March following the taxable year. Taxpayers who earn income in categories 5-8 (see page 57) during the first six months of the taxable year are also required to file half-yearly return and make a payment to the Area Revenue Branch 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.

For more details on taxation issues in Thailand, visit the English language pages of the Revenue Department website http://www.rd.go.th

Deductions allowed for the calculation of PIT

Allowances (Exemptions) allowed for the calculation of PIT