Thailand grants VAT free on Crypto transfers

Based on the report by Bangkok Post on 26 May 2022, the Thai government exempts value added tax (VAT) from the transfer of cryptos until the end of 2023 by issuing a new royal decree issued under the Revenue Code fo the Exemption of VAT.

Without such exemption, the cryptos trading will be subject to 7% of VAT on the transactions. However, the traders are still subject to income tax on the profits with the top margin tax rate of 35% for taxable income over 5 million THB (143.8 thousand USD). As the market crashes in 2022 due to hot inflation in United States and Europe, the trading is more likely than not in a loss position.

Besides, there is a tax planning opportunity on the capital gain on cryptos in Thailand. Revenue Department of Thailand has confirmed that foreign income that is remitted into Thailand before or after the tax year in which it is derived will not be subject to tax in the country. Therefore, the proceeds can be repatriated tax free to the Southeast Asian country when cryptos are traded in foreign markets and not the same year as the repatriation. Please work with tax professional to make sure that the profits above do not have any Thai source.

Given that Residence by Investment (RBI) in Thailand is very affordable and accessible, cryptopians may consider to move to this tax paradise and enjoy tax free regime on cryptos after proper tax planning.