You must be knowing about the sets of regulations governing the process of immigration of foreigners to Thailand. Similarly, there are some mandates that foreigners must follow while leaving Thailand. Obtaining a Tax Clearance Certificate in Thailand is one of those obligations.
This article will guide you through the process of obtaining a Tax Certificate in Thailand. Additionally, this will also help you understand the importance of the document.
- What is a Tax Clearance Certificate?
- Who Requires Tax Clearance Certificate in Thailand?
- Who doesn’t needs Tax Clearance Certificate in Thailand?
- How Many Types of Tax Clearance Certificates in Thailand are there?
- How to Apply for a Tax Clearance Certificate in Thailand?
- What to do for Outstanding Tax Liabilities?
- Loss of Tax Clearance Certificate
- Presentation of Tax Clearance Certificate
- Penalty
What is a Tax Clearance Certificate?
A Tax Clearance Certificate is a document given to a foreigner leaving Thailand. The Director-General of the Thai Revenue Department, the Provincial Governor, or the delegated authority gives this Certificate. This document shows that taxes are not due and is a guarantee or collateral to prove tax liabilities and payable.
Who Requires Tax Clearance Certificate in Thailand?
According to Revenue Code Section 4 Quarter, irrespective of tax liability, a foreigner must apply for a Tax Clearance Certificate. He or she must do so before departing from Thailand. The foreigner must do so in the form declaration of the Director-General within 15 days before leaving the country. If any of the following applies, a foreign national leaving Thailand must submit Form P.1 (Application for Tax Clearance Certificate) and any supporting documentation:
- Is liable to payment of tax or tax arrears before departing Thailand
- Has the duty to file a tax return and pay tax on behalf of a company or juristic partnership incorporated under foreign laws and has been carrying on business in Thailand
- Has taxable income, whether or not in Thailand, from being a public performer in Thailand.
The term “public performer” refers to an actor or actress in a play or motion picture. He or she can also be a performer on radio/television, a musician/singer, a professional athlete, or any other entertainer.
Who doesn’t needs Tax Clearance Certificate in Thailand?
Foreigners need not apply for Tax Clearance Certificate in Thailand under the following conditions:
- A foreigner transiting Thailand, entering or residing in Thailand for a period
- Foreigners transiting Thailand for periods totaling no more than 90 days in a tax year
- Foreigners living in Thailand without earning assessable income, or
- A foreigner as specified by the Director-General with the Minister’s approval.
Additionally, the Notification of the Director-General of the Revenue Department on May 7, 1991, states that with the exception of the above circumstance, foreigners leaving Thailand do not need to file for a Tax Clearance Certificate.
How Many Types of Tax Clearance Certificates in Thailand are there?
P.3 and P. 3.1 are the two different forms of tax clearance certificates.
P.3 Tax Clearance Certificate
This certificate is issued to a visitor leaving Thailand temporarily. It is only good for one leave and needs to be used within 15 days of the date of issuing. The Tax Clearance Certificate will no longer be valid if he does not leave Thailand by the deadline. However, exceptions are there in case of re-issuance before it runs out.
P.3.1 Tax Clearance Certificate
This certificate is for a foreigner who often visits and exits Thailand as a result of his work or occupation. It is valid for recurring leaves of absence during the tenure in the Tax Clearance Certificate. However, this won’t be applicable for more than 180 days after the date of issuance. Form P. 3.1 renewal is not permissible from the Revenue Department of Thailand.
How to Apply for a Tax Clearance Certificate in Thailand?
A foreign national who must have a tax clearance certificate must submit Form P.1, together with the following supporting documentation:
Documents required for P.3 Tax Clearance Certificate
- Passport
- Alien Certificate (if any)
- Residence Certificate (if any)
- Work permit or an application thereof (if any)
- Tax Identification Card
- Letter of guarantee (if having tax liabilities or payable) issued by any of the following authorities:
- A person whose securities are greater than his tax liabilities or payable and whose reputation is acceptable to the Director-General of the Revenue Department
- The Provincial Governor
- The Assignee
- A government officer of level 6 or equivalent or higher.
- A bank with a guaranteed amount exceeding tax liabilities or payable or $50,000.
- Tax payment records for the past three years of the company or juristic partnership which is represented by the applicant for a Tax Clearance Certificate including withholding tax receipts or tax receipts.
- Other evidence as required by the Director-General of the Revenue Department
Documents required for P.3.1 Tax Clearance Certificate
- The above documents 1-7
- Evidence indicating the reasons for departing Thailand on a regular basis in connection with the business or profession of the foreigner
- Evidence indicating that his assets in Thailand are greater than his tax liabilities or tax payable A foreigner applying for a Tax Clearance Certificate is required to file an application to the following persons within 15 days before departing Thailand:
What to do for Outstanding Tax Liabilities?
The Director-General of the Revenue Department, the provincial governor, or the authorized authority must receive a guarantee from the applicant for a Tax Clearance Certificate if they are unable to pay their tax obligations in full or in part or if they become due after the departure date.
Loss of Tax Clearance Certificate
The foreigner must get in touch with the office where they submit their application. This is enough to get a replacement Tax Clearance Certificate in case of misplacement. However, only until the prior Tax Clearance Certificate’s expiration date is reached is the new Tax Clearance Certificate valid.
Presentation of Tax Clearance Certificate
A foreign national leaving Thailand must show the Immigration Office the Tax Clearance Certificate on the day of departure.
Penalty
Without a Tax Clearance Certificate, a foreign national who leaves Thailand or attempts to leave the country would be charged a surcharge equal to 20% of the tax amount. In addition, he faces a fine of no more than 1,000 Baht, a term of imprisonment of no longer than one month, or both.
For any type of assistance and professional guidance in the process of obtaining a tax clearance certificate in Thailand, feel free to write to us at [email protected].
