Dogmatix

I think the problem is that the RD seems to give far less leeway on gifts that are not to spouses, children or parents. The wording sounds broad, "Maintenance income derived under a moral obligation or gifts made in a ceremony or on occasions in accordance with established custom..." but there is a RD case study where the RD disallowed the payment of "maintenance" by a farang overseas to his gf in Thailand on the grounds that that they were not officially married. If they had been married, the implication is that it would have been accepted. There are other cases when a lower court disallowed a gift to a relative who was not a spouse, parent or child on the grounds that it was not made on the occasion of a ceremony or occasion (such as marriage). So I would avoid gifts to a partner to whom you are not legally married to completely to be safe. For gifts to spouses, children and parents, there is no case material that I have been able to find giving any indication of how the RD, in the total absence of any detailed regulations, might check that the giftor has not be able to benefit from the gift. This would be particularly difficult in the case of spouses who typically have comingled funds and whose assets acquired after marriage are automatically deemed common conjugal assets under the Civil and Commercial Code, regardless of which spouse's name they are in. Perhaps some cases will emerge in future. Gift Tax Case RD KK0702-530 11 Feb 2023.docx

A picture of Thaksin surrounded by 100 of his bodyguards walking down a street he wouldn't normally be seen dead in. Quite ridiculous. Thaksin was hated in most of the South including Phuket before he went on his extended holiday. I wonder how much that has changed, now that most Thais under 30 have only a vague idea who is or was.

No idea what was in his disrespectful videos but it seems to me that Thai police should rolling up their sleeves and going out to catch dangerous criminals, rather wasting taxpayer money on this sort of nonsense which is also interfering with freedom of expression and making Thailand look stupid.

For those filing taxes, it's worth knowing about the system of tax deductions for shopping. For the last few years Thai governments have been offering tax deductions for shopping. It started off at 30k but for the 2024 tax year it was increased to 50k. You need a tax receipt and from this year it was necessary to buy from a retailer registered in the e-tax receipt system which all the big ones are. Last year I got e-tax receipts, even though that wasn't yet compulsory. When I did my tax return online last month the shopping tax deduction just popped up automatically. If you are married and opt for joint filing, you both get the 50k deduction but the spouse's tax receipts must be in her name. To get the tax receipts take along your passport and evidence of your TIN. This year's scheme ran from 1 Jan to 15 Feb. So the next opportunity will probably be next January for the 2025 tax year.

Talking about tax receipts for the last few years Thai governments have been offering tax deductions for shopping. It started off at 30k but for the 2024 tax year it was increased to 50k. You need a tax receipt and from this year it was necessary to buy from a retailer registered in the e-tax receipt system which all the big ones are. Last year I got e-tax receipts, even though that wasn't yet compulsory. When I did my tax return online last month the shopping tax deduction just popped up automatically. If you are married and opt for joint filing, you both get the 50k deduction but the spouse's tax receipts must be in her name. To get the tax receipts take along your passport and evidence of your TIN.

Your accountant is correct. You will have to present tax receipts in the company name to claim deductible expenses. My house was originally purchased in my company name and I set up the utilities in the company name, imagining I could charge all to the company. But the accountant said your office is only about 1/8th of the house, so you can only charge 1/8th of the utilities to the company. The account vets the documents and hands it to the auditor who trusts her and approves on her say so with only limited scrutiny. So the accountant is really doing the auditor's job for her.

A lot of people spend many years working abroad and marry a foreigner but plan to retire in the UK. I think they should make the threshold the same as the state pension which is the lowest in Western Europe by long way, while healthcare in the UK is also the worst nowadays.

Thailand's first effort was to go after large tech companies like Netflicks selling into Thailand without a permanent establishment to try to avoid tax. Made them register for VAT which I think has been fairly successful. The small packages tax was originally in the same bill but was dropped by the Prayut government.

I had a problem like that on an expensive item ordered for 2,000 euros in a Black Friday sale with free shipping offered too. The vendor put the gross value before discount and the shipping cost before deducting it on the invoice, then deducted the discount. Guess what? I was forced to pay duty and VAT on the gross price plus shipping.

Amazon and Ebay and some couriers have been operating a system whereby Thai taxes are collected in advance which means that items can be delivered to your door. The taxes are described as deposits and you could be charged more or get a refund. On the rare occasions I have used this service, I have been charged more than the actual Thai import duty and VAT but not got refunds. Others have told me they have received refunds from the Amazon service though. Both Amazon and Ebay have never distinguished items valued at less than 1,500 baht and charged Thai tax on them anyway which was not refunded. I guess the way to go for Aliexpress and for items drop shipped from Lazarda and Shopee from China to Thailand will be to do something similar but only charge VAT below 1,500 which is easier because the rate is a universal 7%, whereas import duty varies from 5% to 40%. There should also be a system to pay VAT online for packages sent by individual senders or those too small to get into this type of sender. But introducing it through a bureaucratic order, bypassing parliament without any of this in place and without worrying about the volume of packages on which the cost to collect it will be more than the VAT is undemocratic, shameful and stupid - all hallmarks of this latest Thaksin government.

And will cause inflation and chaos with no benefit to anyone.

Packages not exempted by the current regulation are taxed on the landed cost value. That means import duty applied to the landed cost which includes insurance and freight. Then VAT is applied to that. Some items like wine also have excise duty and municipal tax applied before the VAT. But VAT has always applied to imports of goods in Thailand ever since it was introduced. If you import products that are manufacturing inputs or you re-export the whole thing. as you say, you can claim the Thai VAT charged at import back. But you cannot claim back any foreign taxes and I doubt China charges VAT on exports anyway.

The coup government tried to do this but shelved the bill. It was revived by the Prayut government but they dropped the cancellation of this exemption, presumably because it was viewed as impractical and costly to implement relative to the amount of VAT, given the large volume of really low value items flowing in from China. At least one can say that the Prayut government put things like this through the democratic parliamentary process with public consultation according to the constitution. This latest Thaksin government rules by decrees put out by bureaucrats, like the foreign remittance tax. Thaksin has always liked to rule by decree and just do things without any planning and preparation and let the system figure it out. An example is his 30 baht healthcare introduced with no planning on the funding. It made the government hospitals technically bankrupt, so they had to be bailed out by the government, while it was later determined under the Sarayudh government, after Thaksin got booted in the coup, that the cost of collecting the 30 baht was more than 30 baht. So it became free. I assume this will be totally chaotic with huge backlogs created to collect tiny amounts of tax per package. Right now you have to go to a post office and stand in long queues to pay taxes on overseas packages over 1,500 and they open every single one over 1,500 too. Anything that looks a bit out of the ordinary and may need an unobtainable import licence, like herbal supplements, you have to pick up from the postal customs at Laksi in Bangkok. I assume there are some provincial offices but probably only in provincial capitals. Often they have no clue what needs an import licence and have to go off and ask someone. But technically all supplements need an import licence. So this could destroy iHerb's large Thai business which comprises many supplements unavailable in Thailand. So the business may just be destroyed rather than going to Thai middlemen. The whole argument about introducing fairness for Thai middlemen that want to sell the same products marked up is obviously complete BS and I am sure they don't even believe that story themselves but don't want to tell the truth that they are trying to grab as much tax as possible and don't care if it costs more to collect it than the tax or that it will be inflationary. If Thais can buy the items direct from China with VAT added by no mark up from a Thai middleman, that is, of course, what they will do. But what is actually happening is that Thai and Chinese middlemen operating in Thailand are taking orders from Thais without keeping any stock themselves. When they get an order, they get the several huge Chinese stockists to drop ship individual packages direct to the Thai customers. Since import duties are still exempted under 1,500, this system will continue. Thai middlemen don't want to keep stock and, if they imported in bulk, they would have to pay both import duty and VAT. So still more expensive than shipping direct from China. Even though this has been talked about since the coup government bill planned to introduce it in 2016 or so, it is still and as unthought through as can be and is likely to cause chaos. If they have to do it, far better to announce that planning is in progress to make it viable and set u a system of online payment, so that goods can still be delivered by postmen without causing chaos at post offices and backlogs. They should also just accept the declarations of most of the low value packages without opening them up, as they do now. Opening an addition 1 million + small packages a month is going to require additional staffing and space and is not worth the cost.

The exemption from import duties and VAT has only ever applied to things coming by post. Things coming by courier never had any exemption.

The Customs Dept order has not yet been posted in the Royal Gazette.

I read something in Thai a few weeks ago that said that taxpayers in areas not covered by an RD branch or sub branch and wishing to deal with RD officers face to face should go to their district office but I can't remember where that was. I assume there are a handful of RD officers stationed in these district offices but have never encountered them. Fiscal responsibilities upcountry are otherwise with the thesabans and thesaban tambons which cover areas that are not the same as tambons that are subdivisions of the amphurs. Land and buildings tax is collected by the thesabans and the dividing lines are totally arbitrary. I have two pieces of land in a medium sized town upcountry that are contiguous, in the same condition of unsuccessfully trying to grow bananas and in the same amphur, with the same Treasury Dept appraisal prices but are in two separate thesabans that collect Land and Buildings Tax at different rates, based on their view of whether the land is utilised or vacant. That gives an idea of how whacky and inconsistent tax assessment can be upcountry. Given no regulations or guidelines on the remittance tax, zero understanding of DTAs or anything "foreign" and limited command of English, there is no reason to assume that assessment of remittance tax will be any less whacky or less inconsistent upcountry that Land and Buildings tax.

I am not an expert on the UK's non-dom rules, which are LIFO ++ or modified LIFO. HMRC demands that in remitting funds to the UK, a non-dom must prioritise the funds that will incur the greatest UK tax liability first. Roughly speaking and simplifying it the priority of types of funds would be something like this" 1. Foreign source income - foreign tax unpaid. 2. Foreign source cap gains - foreign tax unpaid. 3. Foreign source income - foreign tax paid. 4. Foreign cap gains - foreign tax paid. 5. Capital that is non-taxable in the UK. Unsurprisingly they want to rig things so that they collect as much tax as possible. In the UK cap gains are subject to a lower maximum rate of tax and are filed separately, so they don't push you into a higher tax bracket like they do in Thailand. In Thailand it will be mainly foreign cap gains that will cause a problem because there are special arrangements for individuals for cap gains from SET listed stocks )exempt) and property (taxed according a complex set of rules but not lumped in with regular income. Since there are not regulations in Thailand, I wouldn't be surprised, if the RD will start insisting that the income taxable in Thailand at the highest rate is deemed to have been remitted. That will mean them demanding information on all sources of income in the account, so they can assess the correct priority of remittances. In lieu of government certified documents in a format that is similar to what exists in Thailand that RD officers can understand, the line of least resistance will be to ask the taxpayer to submit it all and we will decided later, resulting in a decision to tax the whole lot without approving any tax credits.

Khun Lavaron the DG of the RG who issued order P. 161/2566 just before being transferred is now elevated to permanent secretary at the finance ministry. He has now announced that he will be getting rid of the exemption from VAT on small packages under 1,500 baht imported by post. Because it will take too long to do this using the normal democratic process of amending the customs law in parliament, he will order the Customs Dept DG to issue an order to short circuit the democratic process. The Postal Customs department has no plans for how it will open and assess for tax an additional 15 million small packages a year, many of which are low cost items from China costing less than 100 baht. The current system involves not delivering taxable packages but summoning recipients to post offices and often to the Postal Customs office in Laksi,, Bangkok, for clarification, even for quite common items like musical instrument accessories like reeds. Often they challenge declarations and look up online to see if they can find a similar item selling for more than the declaration and use that value instead. It seems like this order introduced with no planning will create total chaos at post offices and cause huge backlogs. Without doubt the cost of collecting under 7 baht in VAT on the packages under 100 baht will cost more to collect than the tax raised, just like the 30 baht medical charge had to be scrapped because it cost more than 30 baht to collect. At the very least, they should set up a way to pay online and let the packages be delivered by the postmen as normal. They could just asses the items under 1,500 without opening them. But they have no online system and probably will want to open everything to check it is properly declared. It seems like there is a patern with this government and Khun Lavaron in particlar. Rule by decree to avoid parliamentary scrutiny and public consultation. Introduce measures that require detailed planning without any planning or preparation, will likely cost more to administer than revenue collected and will cause chaos. The same is true of the same official's plan to tax remittances. They have no plans of preparation for a far more complex issue than taxing international packages. But under the new Thaksin regime, the bureaucrats need to show they are getting things done. No problem if the systems to implement it takes years to put in place or it turns out to be net money loser. The purpose of this post is not to generate replies about the postal tax (there is another thread for that) but to show that the new system in taxation is not introduce new taxes without thinking it through or caring what chaos it causes.

There is yet another method, I think used in the UK for remittance tax on non-doms' remittance of income. Income is remitted first, then capital. For example you have 100k and earned 50K in capital gains and dividends in a tax year. You want to remit 20k declaring it as 18k tax exempt principal and 2k taxable income. No dice. HMRC requires you to remit all the 50k taxable income before you can remit the tax free principal. So First out income, last out principal FOILOP may be the new Thai accounting standard when they get around to it.

It occurs to me that I have two Thai staff at my company earning 15k a month each who have never filed tax returns in their lives. One of them has been with me for about 15 years and will have several years worth of 2,000 baht fines and interest to pay, if she is ever tracked down for one of those 10 year audits. Our accountant has always said their was no need for them file because they have no tax to pay. Perhaps I need to check she is still of this opinion.

At least the linked document from the RD says documents to show tax paid overseas can be in English or Thai but, since this is a PR release, and not an order to RD officers, they may choose to demand certified translations to Thai, notarised by the MOFA anyway. They say ominously that tax documents certified by the foreign government are "recommended" which no doubt means obligatory in many RD offices. Actually demanding government certified documents will save the officers a lot of trouble, given that most Western countries will not supply them. A perfect solution for RD officers.

Seems like Srettha's days are numbered but Thaksin might keep until after the digital wallet, so he can take the hit, if there is a legal backlash. Thaksin eager to get his daughter in, so he now longer has to deal through a nominee. Money can buy anything in Thailand.

For interest my company was audited by the RD going back four years, despite having filed all tax returns on time. They are restricted to going back 2 years for companies and individuals who have filed proper tax returns but that can be extended, if they think the taxpayer might have intentionally evaded tax. In my case it appeared they gave themselves the right to do this without any ceremony or explanation and trying to refuse them would only make them more determined to dig. The RC doesn't say anything about how far they can go back for individuals or entities that don't file tax returns, So the statute of limitations in the Civil & Commercial Code of 10 years applies in this case. But, if you didn't file because you had no taxable income over the threshold after deductions, they are not going to find much in a 10 year audit, even if you had been tax resident that long. The worst case would be 2,000 baht fines for those years and I think the requirement to file tax without having taxable income has been in place for less than 10 years which would mean you could only be fined for the years after it was introduced. With the large backlogs the inspectors have and the low revenue potential of such an audit, you can decide for yourselves how likely it might be.

Anyone who wants a TIN and is refused one face to face should ask the official to put that in writing or film him or her saying that.

The provision for tax filing for singles is 60k of income, other than income from employment, and 120k income from employment, including employment income from pensions. But what is unclear here is whether state pensions are included in this. There are no Thai state pensions and this form of income is not mentioned anywhere in the RC. So are state pensions income from employment? Not really because they are not paid by employers. Are they derived from employment? Yes indirectly because most countries only pay them to retired workers who generally have to pay contributions. Perhaps an issue to be decided by the Tax Court. Whether they are considered income from employment has a bearing not only on whether they are taxable at all but on whether the 100K allowance for income from employment is applicable to them If you have income over 120k or 60k, depending on the type of income, but no taxable income and you want to be 100% compliant with the letter of the RC, by all means get a TIN, if your tax office will give you one, and go ahead and file a tax return. In deciding this and/or calculating tax, it is up to you whether you decide that remitted state pension income is income from employment, income from investment, or not assessable income at all because it is not mentioned in the RC. Personally I would not bother to file for the time being, if my remitted income is below the tax threshold. That provision is not enforced on Thais and it is unlikely it will be enforced on foreigners at this time. The situation with expat tax returns will be highly chaotic and there will widespread non-compliance with the reinterpretation from both Thais and foreigners, largely because confusion due to the RD's refusal to publish any clarifying guidelines. So the idea that the RD is going to start trying to track down foreigners who remitted peanuts into the Kingdom to fine them 2,000, when they don't do this with Thais, is preposterous.