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Withholding tax is deducted before you ever see the money. When a Thai company pays you a dividend, the company itself withholds the tax and sends it to the Revenue Department on your behalf. On a sale or gift of Thai property, any withholding tax due is calculated and collected by the Land Department when the transfer is registered. The calculation depends on the transaction and the transferor.
Where withholding tax comes up
The rate and the rule both depend on the kind of income.
- Dividends from a Thai company. The company withholds 10% from a dividend paid to an individual shareholder, resident or not, and from a dividend paid to a foreign company that doesn't do business in Thailand (Revenue Department).
- Selling property. When the sale is registered, the Land Department works out the withholding tax itself, from the property's appraised value and the number of years you owned it. A company seller pays a flat 1% of whichever is higher: the contract price or the appraised value.
- Gifting land to someone who isn't a relative. The Land Department treats this the same way as a sale and withholds tax on it.
- Rent and services. A company paying rent or a service fee may also have to withhold tax, but whether it must, and at what rate, depends on the kind of payment and who is on each side. No published rate covers every case here.
Final tax or a prepayment?
If you're a Thai tax resident and the income is a dividend, the Revenue Department gives you a choice. You can leave the 10% withheld as your final tax on that dividend and do nothing more. Or you can add the dividend to your annual return: where the company's profit was taxed at the 20% corporate rate, you gross up the dividend by adding a credit of 20/80 of it to your taxable income, then subtract that same credit from the tax calculated on the return. Where the profit was taxed at the lower SME rates, check with the Revenue Department whether a credit applies and how it's worked out.
For other kinds of income, check separately with the Revenue Department whether the withholding is final or gets credited when you file a return — the answer isn't the same for every kind of income. We never tell a non-resident that the tax is "final" or that no return is needed — it depends on the kind of income, and it's worth checking before you decide. How to file that return is covered in filing a Thai tax return with a lawyer.
What to check: the withholding certificate
Ask whoever withheld the tax for a certificate confirming the amount withheld. In practice this is often called the 50 Tawi, though we'd want to confirm that exact name and what it must contain with the Revenue Department before relying on it. Separately, check with the Revenue Department what confirms that the withheld amount actually reached them.
That certificate may be needed to support a Thai tax return where you want the withheld amount credited against tax you owe here — ask the Revenue Department how it's submitted. If you're a tax resident elsewhere, it may also be the paperwork your home tax authority asks for if you want to claim the Thai tax as a credit there — whether your own country's treaty and rules actually allow that credit is a question for your tax adviser at home, not something Thailand decides.
What's next
If tax has been withheld from a dividend, a property sale or any other Thai payment and you're not sure what to do with it, send us the paperwork. Our lawyers will explain what was withheld and whether it can be credited, in Thailand or at home. Residency decides a lot of this, so it's worth checking when you become a Thai tax resident first. For the wider picture, see our page on Thailand taxes for foreigners.
