ALG＆Associates (Thailand) Co., Ltd. -Legal and tax services in Thailand-

New Law Update

Topic 1. Latest Law Update

Interesting News

1. Announcement of the Board of Investment No. 15/2567 Measures to Assist Investment Promotes Affected by Floods

The key points are as follows:

• 1.1 Eligible Recipients of the Measures:
  Investment promotes who have been affected by floods from the year 2024 onwards in areas that have been officially declared as flood disaster zones.
• 1.2 Application Procedure:
  
  • If the impact occurred before the announcement, applications must be submitted within 6 months from the date of the announcement.
  • If the impact occurred after the announcement, applications must be submitted within 6 months from the date the flood situation is officially declared as over.
• 1.3 Rights and Benefits:
  
  • Exemption from import duties on machinery imported to replace machinery damaged by floods (both new and used machinery that is less than 10 years old).
  • Allowance to write off the value of damaged machinery without incurring tax liabilities.
  • Increase in production capacity based on the actual production capacity of the replacement machinery.
  • Write-off of damaged raw materials and supplies without tax liability.

2. Summary of Investment Promotion Committee Announcement No. 16/2567: Guidelines for Allowing Foreign Legal Entities Granted Investment Promotion to Own Land

This announcement aims to update the guidelines for foreign legal entities granted investment promotion to own land, aligning with current circumstances. The key details are as follows:

• 2.1 Qualifications for Foreign Legal Entities
  
  • Foreign entities granted investment promotion must have registered paid-up capital of at least 50 million baht.
• 2.2 Land Ownership Conditions
  
  • Office Location: Entities can own land for office use up to 5 rai.
  • Residential Use: For operational-level employees housed in buildings, entities can own land up to 20 rai.
  • Land for office and residential use may or may not be located within the same premises as the main business location, depending on suitability.
• 2.3 Sale or Transfer of Land
  When the entity ceases to be promoted, it must sell or transfer the land within 1 year.
• 2.4 Additional Conditions
  The office may issue additional announcements, such as the type of business, distance from the main business premises, room size, etc., to align with specific guidelines and suitability on a case-bycase basis.

This announcement takes effect from November 1, 2024.

3. Announcement of the Board of Investment No. POR. 8/2567 Guidelines and Conditions for Granting Permission for Foreign Entities Promoted by Investment to Own Land for Office and Worker Housing

Key points are as follows:

• 3.1 Eligibility of Applicants:
  
  • Must be a foreign entity promoted by investment.
  • Must have a registered capital of no less than 50 million THB.
• 3.2 Land Ownership Requirements:
  
  • Permission to own land for office and worker housing is granted for up to 20 rai per legal entity.
  • The housing must be used for workers in the promoted investment project only.
  • If the housing is not located near the establishment, it must be no more than 10 kilometers away from the promoted investment site.
• 3.3 Prohibitions and Obligations:
  
  • The land must not be used for purposes contrary to morals, traditions, or local community values.
  • The entity must facilitate inspections by authorities regarding land usage.
  • If conditions are violated, the land ownership rights will be revoked, and the land must be sold within 1 year.
• 3.4 Consideration:
  
  • Applications previously submitted under the old announcement (No. POR. 10/2566) will be considered based on the guidelines in this new announcement.

The permission for foreign entities to own land for office and worker housing will be granted based on the entity’s registered capital and specific conditions, including using the land for appropriate purposes and ensuring that the housing is within 10 kilometers of the investment establishment.

4. Destination Thailand Visa (DTV):A Gateway for Digital Nomads and Activity Participants

The Destination Thailand Visa (DTV) offers a specialized visa for digital nomads, remote workers, freelancers, and participants in select activities in Thailand. Here’s a summary of key details:

• Where to Apply
  
  • Thai e-Visa: www.thaievisa.go.th
  • RTE / RTCG Offices

• Who is Eligible?
  
  • 4.1. Workcation: Digital Nomads, Remote Workers, and Freelancers
  • 4.2 Participants in Specific Activities such as:
    • Muay Thai training
    • Thai cooking classes
    • Sport training sessions
    • Medical treatments
    • Seminars
    • Music festivals
  • 4.3 Spouses and Dependent Children of DTV holders
    • Required Documents
    • Passport or Travel Document
    • Recent Photograph
    • Proof of Current Location
    • Financial Evidence: Showing a minimum of 500,000 THB (e.g., bank statements, payslips, sponsorship letter)
  • 4.4. Purpose of Visit:
    • Workcation: Employment contract, certificate, or professional portfolio demonstrating remote work or freelance status.
    • Thai Soft Power Activities: Confirmation or appointment letter for activities or treatments.
    • Spouse/Dependent: Documentation proving relationship (e.g., marriage or birth certificate).
  • Visa Details
    • Fee: The application fee for the DTV visa may range from ฿9,337 to ฿40,931, depending on the location where you apply.
    • Validity: 5 years, with multiple entries
    • Stay Duration: 180 days per entry
    • Extension: One-time extension up to 180 days, requiring re-entry after 180 days to continue the stay within the visa’s validity period.

However, this type of visa does not provide tax benefits such as the reduced personal income tax rate of 17% or income tax exemptions for bringing income into the Kingdom, which are privileges granted to LTR Visa holders.

The DTA Visa allows a stay in Thailand of up to 180 days per visit. After that, the holder may re-enter for another 180 days within a five-year period. However, if the holder resides in Thailand for more than 180 consecutive days within a calendar year (January 1 to December 31), they will be considered a tax resident of Thailand.

Therefore, if the stay in Thailand does not exceed 180 days in a calendar year, any foreign-sourced income brought into the Kingdom will be exempt from Thai personal income tax. Conversely, if the stay exceeds 180 days in a calendar year, the individual will be subject to personal income tax on income brought into Thailand. Additionally, if the holder of this visa wishes to work for an employer in Thailand, they must change their visa type to a Non-Immigrant B Visa and apply for a work permit accordingly.