Digital nomad visa Thailand_visa application

Digital nomad visa to long-stay or work remotely in Thailand

Digital nomads or remote workers currently can work in Thailand, but most would be in the grey area. We also explored this topic in our previous Thailand’s digital nomad visa article. Thailand is working on 2 special visas in 2021 which might be just what digital nomads need to enjoy a worry-free stay in Thailand.

Let’s explore the digital nomad visa available in Thailand now, and changes that are to come in the future.

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Digital nomad visa Thailand: SMART visa

The Thai government introduced SMART visa in 2018. This was an initiative to attract talents and investors to nurture Thailand’s development.

SMART visa can give you a renewable 2 to 4-year visa, which also allows you to work in Thailand without any work permit. The SMART visa comprises of 5 categories namely:

  • SMART T (Talent): targeting highly skilled professionals. In this case, applicants must satisfy certain employment and salary requirement
  • SMART I (Investor): targeting investors within the tech sector. In this case, applicants must satisfy certain investment criteria. Mainly the criteria have to do with having investment in targeted industries within Thailand
  • SMART E (Executive): targeting high-level executives (Chairman or Director level). In this case, applicants must satisfy certain position, income, and employer requirement
  • SMART S (Start-up): targeting entrepreneurs who look to set up a technology-based company in Thailand. In this case, applicants must satisfy company ownership and financial criteria
  • Smart O (Other): mostly to help child and spouse of SMART visa holders

The SMART T visa

Smart T visa is the most relevant to digital nomad and remote workers. Currently, if you are an employee of a company within the targeted industry, have a minimum contract length of 1 year, and have a monthly salary of at least THB 100,000 (US$3,200), then your employer can help you to apply for the SMART T visa.

With the strict requirements above, a SMART T visa is not the most convenient for a digital nomad or remote worker to enjoy a long stay in Thailand. In fact, only 156 people have managed to get approval for this visa so far.

The government has recognized this as an important issue and they are looking to relax the requirement. This includes allowing employees to apply for the visa themselves and reducing the contract length requirement to 6 months.

Digital nomad visa thailand_nature

Visa is often the last thing between digital nomads and a worry-free, long stay experience in Thailand.

Thailand digital nomad visa 2021 – the new 10 years visa

To some, 4 years with no renewal guarantee of the visa might be too short for a permanent/long-term migration. If you are looking for a longer-term visa then you are in luck.

The Tourism Authority of Thailand has recently proposed a new type of long-stay visa in Thailand to the government for review and approval. The aim of this visa is to attract talent and stimulate the Thai economy. 

The visa has 4 main targets:

  • Wealthy (high earners and investors): to qualify, the applicant must have at least US$500,000 of investment in real estate or government bond + proof of annual income of at least US$80,000 in the past 2 years + US$100,000 coverage of health insurance
  • Retiree (50 years or older with retirement income): to qualify, the applicant must have at least US$250,000 investment in real estate or government bond + proof of income at least US$40,000 of income per year + US$100,000 coverage of health insurance
  • Digital nomad and remote worker (with overseas employers): to qualify, the applicant must have at least US$80,000 of annual income over the past 2 years (or US$40,000 per year if the applicant has a master degree / own IP / received series A funding) + have 5 years of work experience + US$100,000 coverage of health insurance
  • Specialist (professionals within Thailand’s targeted industries or university professors). The same requirement as the above, but need to be within Thailand’s targeted industries – the details are not out at the moment 

With this 10 years visa, there is finally a visa specifically for the digital nomad or remote worker. However, the requirement is still pretty steep. 

It is still in its early days for the long-stay visa. But we hope to see that some of the requirements relaxed before government approval.

So, what’s the status of Thailand's digital nomad visa in 2021?

There are a diverse range of experiences that Thailand can offer to digital nomads. However, it is still not easy to get a visa and work with peace of mind as a digital nomad in Thailand.

The country has recognized the importance of having a proper digital nomad visa. That is visas to support foreign workforce who may not be working for companies in Thailand.

Whether it is through the Thailand SMART visa or the new 10-year visa, we hope to see the process made easier and simpler. 

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Thailand income tax_remote working

Thailand income tax for digital nomads and remote workers

Whether you are planning to live in Thailand or temporarily stay in the country as a digital nomad or remote worker, it is important to understand Thailand’s income tax system so that you do not get into trouble or get caught by surprise during your stay. 

As a continuation of our previous post on visa and tax, we will further examine if foreigners need to pay personal income tax, and if so how much?

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Do you need to pay for income tax when you work remotely in Thailand?

If you are a foreigner working in Thailand under a work permit, you are likely to have your tax ID already. This means you have to pay personal income tax (this is part of your work permit process). However, if you are a digital nomad or simply working remotely in Thailand, this is more complicated. 

First, the revenue department would categorize everyone into resident and non-resident. 

Residents are everyone in Thailand who spend a total of 180 days in Thailand within 1 calendar year.  For example, you are a resident if you spent January to March in Thailand, left then came back to stay from September to December. On the other hand, non-residents are everyone who spends less than 180 days in Thailand within 1 calendar year.

The law requires residents to pay personal income tax for income they earn in Thailand AND a portion of income from foreign sources they bring into Thailand. Whereas, non-residents only need to pay tax for income that they earned in Thailand.

In summary, digital nomads or remote workers, who spend less than 6 months in Thailand and work for employers overseas, will not need to pay tax. If you are looking to generate income from sources in Thailand, this may raise concerns on whether you have the necessary working permit. 

So, how much is income tax in Thailand?

Unless you are planning to take up a full-time position in Thailand, foreigners who are only paying for a portion of income brought into Thailand are likely going to pay less than 10% of that income as a tax.

Like many other countries, the formula to calculate taxable income is assessable income – deductions – allowance. 

Thailand follows a progressive tax rate for personal income, which ranges from 5 to 35% of taxable income (each bracket increases by 5%). 

In case you are not familiar with progressive tax calculation, we will give you an example with some numbers. Let’s say a person has THB 750,000 (~USD 24,000) of taxable income. This person would pay (150,000 * 0%) + (150,000 * 5%) + (200,000 * 10%) + (250,000 * 15%) = THB 65,000 (~USD 2,000).

Certain type of capital gain would also be counted as part of assessable income, hence it is also a good idea to understand how capital gains tax work in Thailand.

Thailand income tax_tax rate

Thailand income tax expense deduction and allowances

Thailand allows an expense deduction of 50% of total expenditure, capping at THB 100,000 for YA2020. You can claim these expenses using tax invoices from registered merchants. There is a limit of income deduction of 40%, but the government also capped this at THB 60,000. 

For allowances, the common ones that apply to most people are: 

  • Personal allowance: THB 30,000
  • Spouse allowance: THB 30,000
  • Child allowance: THB 15,000 each, up to 3 children
  • Child education allowance: THB 2,000 for each child

Other allowances that you can consider:

  • Life insurance premium: actual premium paid capped at THB 100,000 
  • Long term equity fund: actual investment amount capped at less than 15% of salary or THB 500,000
  • Mortgage interest: actual amount paid but capped at THB 100,000

There are tax calculators which would also help to take into account these various allowances – one example is this one from UOB. There are many tools online that can help you to understand how much income tax in Thailand that you need to pay.

New government initiatives in 2022

The Thai government has announced a plan to waive personal income tax for a few groups of foreigners in Thailand in February 2022.  While exact details are not out yet, the government has an intention to waive personal income tax for professionals who are looking to work remotely in Thailand. However, it is very likely that the waiver will only apply to income earned from work outside of the country.

So, do digital nomads need to worry about paying tax in Thailand?

If you want to stay in Thailand for an extended period of time (longer than 6 months) whether on an employment contract, remote working or as a digital nomad, you should think about the tax implications. 

Fortunately, foreigners may only be assessed on a portion of the income they bring into Thailand. With progressive tax and various deductions and allowances, you are likely going to be paying less than 10%.

Go check out other posts that we have on Thailand: 

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Digital nomad in Thailand_visa

Digital nomad in Thailand: understanding visa and tax

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).

Digital nomad inThailand_remote working

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

Digital nomad in Thailand_SMART visa

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.

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