Inheritance tax in Thailand is 5% for spouses and direct descendants and 10% for other heirs on amounts exceeding 100 million baht (THB).
For expats and foreigners, the exact rules, exemptions, and property restrictions can affect how much tax you actually pay.
This article covers:
- Do you pay inheritance tax in Thailand?
- How much will I have to pay in inheritance tax in Thailand?
- Who is disqualified from inheriting under a will?
- What exemptions are there for inheritance tax?
Key Takeaways:
- Direct descendants and spouses can inherit up to 100 million THB tax-free.
- Other heirs pay 10% on amounts exceeding the threshold.
- Foreigners can inherit property but must follow Thai ownership rules.
- Legal planning strategies can reduce inheritance tax without breaking the law.
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The information in this article is for general guidance only. It does not constitute financial, legal, or tax advice, and is not a recommendation or solicitation to invest. Some facts may have changed since the time of writing.
What are the inheritance tax rules in Thailand?
Inheritance tax in Thailand is applied to the transfer of assets from a deceased person to their heirs.
The tax rules depend on two main factors:
- Relationship to the deceased: Spouses, children, parents, and other close relatives benefit from higher exemptions than distant relatives or unrelated heirs.
- Residency status: Thai residents and foreigners can inherit property, but certain rules apply to non-residents, particularly regarding immovable property.
Inheritance tax must be declared within 150 days from the date of death, and the payment is generally made before the transfer of ownership.
Thailand uses a progressive tax approach for certain categories of beneficiaries, with different exemptions for each.
What is the inheritance tax rate in Thailand?
The Thai inheritance tax rate is 5% for spouses and direct descendants and 10% for other heirs on amounts above 100 million THB.
- Direct descendants (children, grandchildren, spouses): 5% on amounts exceeding 100 million THB
- Other heirs (siblings, nieces, nephews, non-relatives): 10% on amounts exceeding 100 million THB
Thailand offers generous exemptions for immediate family members, making inheritance tax less burdensome for spouses and children.
What is the inheritance tax in Thailand for foreigners?
For foreigners in Thailand, the same 5% and 10% inheritance tax rates apply once inherited assets exceed 100 million THB, with no preferential treatment based on nationality.
Foreign spouses and children of the deceased are taxed at 5% above the exemption threshold, while foreign siblings, extended family members, or unrelated heirs are taxed at 10%.
The key difference for foreigners is not the tax rate itself, but how Thai law treats asset location and ownership, especially for real estate.
Inheritance tax applies only to assets located in Thailand, such as Thai property, bank accounts, shares, and other domestic investments.
Assets held entirely outside Thailand are not subject to Thai inheritance tax, though they may be taxable in the heir’s home country.
For foreign heirs, inheritance tax must be settled before legal transfer of ownership, and additional regulatory approvals may apply when inheriting restricted assets.
Can foreigners inherit property in Thailand?
Yes, foreigners can inherit Thai property, but there are restrictions.
- Land ownership: Foreigners generally cannot own land outright but can inherit land through a lease or via a Thai company structure.
- Condos and buildings: Foreigners can inherit condominium units in compliance with Thailand’s foreign ownership rules.
- Bank accounts and securities: Financial assets can be inherited without restriction, but taxes may apply on amounts exceeding the thresholds.
Inheritance planning is crucial for expats who want to ensure that their heirs can legally inherit their assets in Thailand.
Who is not allowed to inherit from parents?
A person is not allowed to inherit if they are not legally acknowledged as a child under Thai law or if they are disqualified under succession rules.
This includes individuals who were never legally recognized or legitimated, as well as those expressly excluded by a valid will.
Heirs can also lose their inheritance rights if they intentionally committed serious wrongdoing against the deceased, such as fraud, coercion, or causing death, as provided under Thai succession law.
Foreign nationality alone does not disqualify a person from inheriting, but legal status, documentation, and compliance with Thai inheritance procedures are critical.
In the absence of a valid will, Thailand’s intestacy rules determine who qualifies as a lawful heir.
How much can you inherit from your parents without paying inheritance tax?
If you are a child or spouse of the deceased, you can inherit up to 100 million THB in Thailand without paying inheritance tax.
This threshold applies per inheritance event, which means multiple inheritances from different family members can each benefit from the exemption.
For other relatives or unrelated heirs, the threshold is the same, but the tax rate applied above it is higher at 10%.
Example calculation:
- If a child inherits 120 million THB from a parent, the first 100 million THB is tax-free.
- The remaining 20 million THB is taxed at 5%, resulting in 1 million THB inheritance tax.
- If a sibling inherits the same 120 million THB, the tax rate is 10% on the excess 20 million THB, resulting in 2 million THB tax.
Who is exempt from inheritance tax in Thailand?
Spouses, children, and parents are fully or partially exempt from inheritance tax in Thailand.
Specifically:
- Spouses, children, and parents can inherit up to 100 million THB tax-free.
- Other relatives, such as siblings or cousins, are generally not fully exempt, though certain deductions may apply depending on the estate’s total value.
- Charitable donations can also reduce the taxable portion of the inheritance, providing additional planning opportunities.
This structure ensures that immediate family members benefit from generous exemptions, while more distant relatives or non-family beneficiaries may face taxation based on the remaining estate value.
How to avoid inheritance tax in Thailand?
You can legally reduce Thailand IHT through lifetime gifting, trusts, insurance, and charitable donations.
1. Lifetime gifting: Transfer assets to heirs during your lifetime, ensuring proper documentation and compliance with Thai tax laws.
2. Trusts and foundations: Establishing a Thai foundation or trust can help structure the inheritance more tax-efficiently.
3. Insurance policies: Life insurance payouts to beneficiaries can sometimes be structured to avoid inheritance tax.
4. Charitable donations: Donations to approved charities may reduce taxable amounts.
Careful estate planning with a qualified Thai tax advisor is recommended for foreigners and expats.
Conclusion
Inheritance tax in Thailand is straightforward for immediate family but can become complex for other heirs and foreigners.
Understanding the rates, exemptions, and legal restrictions early can help expats and non-residents protect their assets and plan efficiently.
Proactive estate planning, proper documentation, and professional guidance are the keys to minimizing tax liabilities and ensuring a smooth transfer of wealth.
FAQs
Does the UK have a double tax treaty with Thailand?
Yes, the UK and Thailand do have a double tax treaty, but it only covers income tax matters (such as business profits, dividends, interest, and royalties).
However, there is no treaty between the UK and Thailand that covers inheritance tax, so UK residents inheriting assets in Thailand must still follow UK inheritance tax rules without treaty relief.
What is the right to inherit property?
The right to inherit property, also known as succession rights, refers to the legal entitlement of heirs to receive the deceased’s assets under Thai inheritance law.
This is governed by the Thai Civil and Commercial Code and can be affected by wills, intestacy rules, and applicable tax regulations.
How to avoid Thai tax on foreign income?
Foreigners can reduce Thai tax on foreign income by ensuring proper residency planning and understanding the sources of their income.
Income earned outside Thailand and not remitted may not be subject to Thai income tax, but inheritance and gifts originating within Thailand remain taxable.
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