The Inheritance Tax Act B.E. 2558 (the "ITA") is one of the key tax reforms which came into force on 1 February 2016 with an aim at bridging the gap of income disparity in Thailand as well as increasing state revenue.

An inheritor receiving the prescribed assets (e.g. immovable property, securities, bank deposit, registered vehicle, and other financial assets to be further announced) with aggregate value over Baht 100 million from each testator will be taxed on the portion exceeding the said threshold at the rate of 5 percent for ascendants and descendants and 10 percent for others. In any event, the ITA does not apply to inheritance received by the surviving spouse and tax exemption is also available for an heir who will use the inheritance for religious, educational, or public purposes as intended by the testators.

As a countermeasure for possible avoidance of the inheritance tax, the Thai Revenue Code was amended to include a new gift tax which came into effect on the same date as the ITA. In brief, an individual receiving certain types of gifts in excess of the tax-free thresholds will be subject to personal income tax at the rate of 5 percent of the exceeding portion with an option to exclude such income from annual income tax computation. 
 

This document is solely intended to provide an update on recent development in Thailand legislation and is not purported to provide a legal opinion, nor a legal advice to any person.