With a recent trend in remote working and digital nomad lifestyle, we have shared an article on Thailand as a digital nomad destination here. However, the big question remains: is it legal to work in Thailand without a proper work permit? And, what kind of tax implication do you need to look out for?
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Digital nomad in Thailand: understanding visa exemption and special tourist visa
Visiting Thailand is the easiest under visa exemption. Thailand visa exemption supports over 60 nationalities, visitors can stay up to 30 days (currently extended to 45 days). Longer stay up to 90 days is possible through the special tourist visa.
How to apply for the special tourist visa? The standard application process requires document submission, purchasing of insurance, showing of proof of accommodation, etc. However, this may vary depending on your nationality. Hence, we recommend you to check with the Thai consulate/embassy in your city. Also, keep in mind that both visa exemption arrangement and the special tourist visa are meant for people who are entering for tourism and not work.
Are digital nomads allowed to work remotely in Thailand without a work permit?
Let’s just be upfront – this is still a grey area. While there are specific requirements such as being on a non-immigrant visa and obtaining a work permit to work IN Thailand – there is no specific law against foreigners who are conducting their normal overseas work while being in Thailand.
For example, if you work for a company (or clients) in your home country, while sitting in Thailand – this is unlikely to cause any issue. You will start to raise concern with the authority once you start working with the Thai customers/clients. Therefore, in general, if you are planning to continue your current job while enjoying a short stay in Thailand, there should not be a problem. Best to keep your short stay under 6 months to minimize any tax implication. However, if you want to have a peace of mind and enjoy a longer stay, try to get your work permit or SMART visa (more in below section).
What’s most important to have is a visa with a validity period that is long enough to sustain the stay duration. Many digital nomads are solving this problem by re-entering the country. This is not that convenient but can sustain their intended stay duration. This is what nomads do since there is no specific digital nomad visa yet.
Various government agencies have recognized the presence of digital nomads and their contribution to the economy. There have been many mentions of digital nomads in government communication and also news but without mentioning legal implications. Given the importance of digital nomads to Thailand’s economy, Thailand has taken the initiative to attract and legalize digital nomads with the introduction of the SMART visa.
Thailand SMART visa and remote workers
The government first introduced the SMART visa in 2018 with the purpose to attract skilled professionals and investors to Thailand. This SMART visa can provide up to 4 years of permission to stay and work in Thailand.
Under this visa, you do not need to get a work permit before you can work in Thailand. However, the original purpose of the SMART visa was to mainly attract highly skilled professionals or executives. Because of this, the visa comes with a long list of requirements. As a result, less than 1,000 applications have been approved so far.
There is a proposed plan by Thailand’s board of investment to relax the requirements. The only thing pending is the Thai cabinet’s approval. With this proposal, the most exciting change we can expect is the change to the SMART T (Talent) type of the SMART visa. Currently this SMART T visa requires employers to apply on behalf of the employee. With the proposed change, individual remote workers can apply for this visa directly, as long as they have at least 6 months contract in their original country, earn at least THB 100,000 salary per month, and can prove that they have at least THB 600,000 of savings in the bank – according to the Chiang Mai Entrepreneurship Association.
Income tax for foreigners working remotely in Thailand
A frequently asked question among nomads is: Do digital nomads need to pay tax while working in Thailand?
The Revenue Department categorizes potential tax payers into “resident” and “non-resident”. You are a resident if you have stayed in Thailand for more than 180 days per year. Any less than that you are considered a non-resident.
The law requires non-residents to pay tax for income that they earn from sources in Thailand. Whereas for residents, the law requires them to pay tax for income earned from sources in Thailand AND the portion of income from foreign sources that they bring into Thailand.
Referring to the above, if a digital nomad is working with an employer from their home country and has spent less than 6 months in Thailand, he/she does not need to pay taxes. On another note, once a digital nomad obtains a work or a SMART visa, he/she needs to file and pay tax in Thailand.
So do digital nomads in Thailand need visa and pay for tax?
Thailand is a great destination for digital nomads, and there are already a lot of digital nomads in Thailand. However, visa restriction remains as one of the main concerns.
The country is not yet fully ready to allow digital nomads and remote workers to work in the country legally, however there has been a good development on this in recent years.
Thailand has recognized the importance of remote working and is pushing initiatives around SMART visa to make it applicable for remote workers to apply as well. Hopefully, by the time coronavirus is over, remote working will become a new norm and Thailand would be ready to accommodate remote workers.
Other useful resources about Thailand