Rental Income Tax in Thailand: A Guide for Phuket Owners

Rental income tax in Thailand applies to every owner who lets out a condo or house here, whether you live in Phuket full time or manage your unit from overseas: rent from Thai property is Thai-source income, so it falls under Thai personal income tax even if you never set foot in the country during the year. With the high season pushing up demand for both holiday and long-term lets, this guide explains how the tax is worked out, what is withheld, when to file and the mistakes Phuket landlords most often make.

Who has to pay tax on rent from Thai property?

The Revenue Department splits taxpayers into residents and non-residents. A resident is someone who spends more than 180 days in Thailand in a calendar year. Residents are taxed on income from Thai sources and on foreign income they bring into the country, while non-residents are taxed only on income from Thai sources. Because a Phuket condo or villa is physically in Thailand, its rent is taxable in both cases.

Rent is classed as income from letting property, one of the eight categories of assessable income in the Revenue Code. This applies whether you own a freehold unit under the Phuket condo foreign quota or hold a house on a long lease, as explained in our guide to freehold vs leasehold in Phuket.

How is rental income tax in Thailand calculated?

You start with the gross rent received in the year. For buildings, the law lets you deduct a flat 30 percent as expenses without receipts, or you can claim documented actual expenses instead. What remains, after any personal allowances you are entitled to, is taxed at progressive rates that start at zero on the first 150,000 baht of net income and rise in steps to a top rate of 35 percent.

Here is a simple illustration before allowances, using a unit let at 30,000 baht a month for a full year:

Step	Amount (baht)
Gross annual rent (12 x 30,000)	360,000
Less 30 percent standard deduction	108,000
Net income	252,000
Tax on first 150,000 (0 percent)	0
Tax on next 102,000 (5 percent)	5,100

Your real figure will depend on allowances, other Thai income and your residency status, so treat this as a guide to the method rather than a tax bill. If you are still choosing a unit, our look at Phuket condo rental yields shows why the tax should be part of your net yield sums.

What is withheld before you receive the rent?

Withholding is the part of rental income tax in Thailand that most owners notice first, and it is an advance payment, not an extra charge. The Revenue Code requires a payer of rent to a non-resident to withhold 15 percent of the payment and pass it to the Revenue Department. When a Thai company rents from a resident individual, it normally withholds 5 percent. In both cases the tenant should give you a withholding certificate, often called a 50 Tawi, which you use as a credit when you file.

For many smaller landlords, the 15 percent withheld from gross rent is more than the tax due under the progressive scale. Filing a return is the way to have the tax recalculated and any overpayment refunded.

When and how should you file?

• Get a Thai tax identification number. Foreign owners can apply at an area revenue office; bring your passport and ownership documents.
• Keep records. Save tenancy contracts, bank statements showing rent received and every 50 Tawi certificate.
• File the annual return. The full-year personal income tax return, form PND 90, is due by the end of March of the following year, and online filing usually gets a short extension.
• Watch the half-year return. Rental income received from January to June may also need a mid-year return, PND 94, due by the end of September.
• Check your home country. Thailand has double taxation agreements with many countries, which can let you credit Thai tax against tax at home.

Does the type of rental change anything?

The tax method above is designed for ordinary leases. Letting a condo night by night is a different matter, because short stays can fall under hotel licensing rules. Before you list on booking platforms, read our explainers on Phuket short-term rental rules and whether Airbnb is legal in Phuket. Owners of long-term lets should also budget for the separate annual land and building tax in Phuket, which is charged on the property rather than on the rent.

What mistakes do Phuket landlords make?

The most common is assuming that money paid into a foreign bank account is outside Thai tax. It is not, because the source of the income is the Thai property. Others lose track of withholding certificates, forget that management company fees are only deductible if they choose actual expenses, or let a rental pool contract run without asking who files and pays the tax. If your unit is in a managed scheme, our guide to guaranteed rental return in Phuket lists the questions to put to the operator.

For the official rules, the Revenue Department's personal income tax page sets out residency, the categories of income and the standard deductions. Because rates, allowances and deadlines can change, check the current position with the Revenue Department or a licensed Thai accountant before you file.

FAQ

Do I pay rental income tax in Thailand if I live abroad?

Yes. Rent from a property located in Thailand is Thai-source income, so non-residents are taxed on it too, often through 15 percent withholding.

Can I deduct my common area fees and repairs?

Only if you choose to claim actual documented expenses instead of the flat 30 percent deduction for buildings. You cannot claim both.

Is the withheld tax my final tax?

Not necessarily. Withholding is a credit against your final liability, and filing a return can lead to a refund if too much was withheld.

Is rental income tax the same as land and building tax?

No. Income tax is charged on the rent you earn, while land and building tax is an annual local tax on the property itself.

Photo: Mattes / Wikimedia Commons, public domain