Moving to Thailand from Australia: Everything You Need to Know About Remitting Foreign Income

If you’re planning on moving to Thailand from Australia, or you’re already living there as an Australian Expat, understanding how foreign income is taxed when it’s brought into Thailand is essential. Thailand’s tax landscape has evolved, and new rules now determine how and when foreign-sourced income becomes taxable once remitted into the country.

This blog discusses key principles and considerations that Australian Expats in Thailand should be aware of, including tax residency, foreign-sourced income, remittance rules, and the proposed changes that could affect your future decisions.

Who Qualifies as a Tax Resident in Thailand?

When moving to Thailand from Australia, one of the first areas to clarify is your tax residency status. Under Thai law, a person who resides in Thailand for 180 days or more in a tax (calendar) year is considered a tax resident.

Once you become a tax resident, you’re subject to Thailand’s personal income tax on income sourced locally and, under certain circumstances, from abroad.

If you stay in Thailand for fewer than 180 days, you are generally classified as a non-resident. In that case, only income earned within Thailand is typically subject to Thai taxation.

Understanding Foreign-Sourced Income

For Australians moving to Thailand, foreign-sourced income refers to any income earned outside Thailand. This could include rent from Australian property, dividends from investments, or overseas pensions.

The taxation of this income depends on when it was earned and if it’s brought into Thailand. If you’re a tax resident in Thailand and you transfer money earned overseas into Thailand, it may become taxable under the country’s updated tax rules.

Thailand’s Updated Rules on Remitting Foreign Income

In 2023, Thailand’s Revenue Department introduced significant changes to income taxes that came into effect from 1 January 2024. Two directives (No. Paw. 161/2566 and Paw. 162/2566) now require tax residents in Thailand to include foreign-sourced income they remit into Thailand as assessable income in the year it is remitted.

This means that if you earned foreign income after 1 January 2024 and transfer it into Thailand at any time after that, it could be subject to personal income tax (PIT) under Thailand’s progressive rates, which currently range from 5% to 35%.

For example, if you’re an Australian Expat living in Thailand and you transfer dividends earned in Australia into your Thai bank account after becoming a resident, those funds could now be considered taxable income in Thailand.

For income earned before 1 January 2024, the previous rules still apply, where remitted funds may remain non-taxable when brought into Thailand later, depending on your circumstances.

Potential Tax Policy Relaxation in Thailand

There is some potential relief on the horizon for those moving to Thailand from Australia. Thai authorities have been discussing a relaxation of the rules to encourage income flows into the economy. These changes could exempt certain foreign income from personal income tax, provided specific conditions are met.

Under the proposal, foreign income earned from 1 January 2024 onward and remitted into Thailand within two years of being earned may qualify for a tax exemption. If remitted after the two years, the regular tax rules would continue to apply.

At the time of writing, these changes are not yet law and remain subject to revision.

Avoiding Double Taxation: The Australia–Thailand Connection

If you’re moving to Thailand from Australia, you may still have ongoing Australian tax obligations. Fortunately, Thailand and Australia have a Double Taxation Agreement (DTA) designed to prevent the same income from being taxed twice.

If you have already paid tax in Australia on income later remitted into Thailand, you may be eligible to claim foreign income tax credits under the DTA. To support your claim, it’s essential to maintain clear records of where your income originated, how much tax was paid in Australia, and the dates of both earnings and remittances. Accurate documentation is key for compliance in both jurisdictions.

Practical Considerations for Australian Expats

If you are moving to Thailand from Australia, it’s wise to plan your financial strategy early. Confirm your tax residency status and consider how long you’ll stay in Thailand. If your stay in Thailand is not permanent, you should consider limiting how much income from Australian assets you remit into Thailand.

You should also consider when your foreign income was earned; foreign income earned after 1 January 2024 will generally fall under the new regime. Keeping detailed records of income sources, dates, and taxes paid will help you stay compliant and avoid unexpected liabilities.

Finally, given the evolving nature of Thai tax law, stay informed about legislative developments and seek advice from a qualified tax professional. Cross-border tax rules can be complex, and professional guidance can help you optimise your financial arrangements.

Conclusion

For Australians moving to Thailand from Australia, the taxation of foreign income has become a crucial issue, especially under the post-2024 regulations. Once you are a tax resident, the income you bring into Thailand may be subject to local tax, depending on when it was earned.

By planning ahead, maintaining comprehensive records, and obtaining expert advice, you can manage your tax obligations effectively and make the most of your time in Thailand. Staying proactive and informed will ensure your transition is as smooth and as financially efficient as possible.

Runway Wealth Management is the trusted Financial Adviser to the Australian Expat community. Our tailored advice is backed by expertise, education and experience, which allows us to be at the forefront of Australian Expat Financial Planning.

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General Advice Disclaimer: The information contained herein is of a general nature only and does not constitute personal advice. You should not act on any recommendation without considering your personal needs, circumstances, and objectives. We recommend you obtain professional financial advice specific to your circumstances.