All depositors earning interest income are required to provide consent to banks to submit their interest income data to the Revenue Department to avoid losing a 15% withholding tax exemption if they earn income of less than 20,000 baht a year.
The move is meant to stem the break up of deposits into several accounts at more than one bank to avoid the withholding tax.
Depositors who earn interest income below 20,000 baht per year must offer permission for financial institutions offering deposit accounts to report their interest income information to the Revenue Department in exchange for maintaining the 15% withholding tax income waiver, said a source at the Finance Ministry who requested anonymity.
Those earning interest less than 20,000 a year are exempt from the withholding tax on interest.
The interest income information submission is a crucial part of a notification from the department's director-general issued on April 4, 2019.
After depositors provide consent, banks are responsible for reporting the interest income information to the Revenue Department via its website.
Banks must submit information on first-half interest payable by June 30 in July, and full-year interest payable by Dec 31 within January of the following year.
The source said depositors who fail to comply with the notification are barred from the withholding tax waiver and banks must withhold the tax and remit to the tax-collecting agency. Any banks that do not withhold the tax must remit it plus a fine of 1.5% per month to the Revenue Department.
The latest notification also requires account holder names and taxpayer identification numbers to be the same as on interest or return recipients.