Dogmatix

No fines for not filing a tax return, if there is no assessable income. The contentious area is where a tax resident has assessable income over 120k but no tax is payable, due to income less deductions being less than the tax free threshold of 150k. Bizarrely a tax return is required in this case on pain of a fine of 2k but there is no evidence that this part of the law has ever been enforce. As previously mentioned the Prayut govt introduced the requirement to file in this situation claiming that it would put the govt in the position of being able to pay benefits to those low income earners. There has been no further mention of these welfare payments and there was never any explanation why those earning less than 120k should be left out, if that had been a genuine argument. The real reason was of course to try to force more people doing sole proprietor business into the tax net, i.e. get someone into the habit of filing on the premise they will have no tax to pay, then whoops they suddenly find a couple of years later they do have tax to pay. To your more pertinent question. No, you do not have to file a tax return for a year where your only onshore income comprises foreign source income that arose prior to 2024. I think that because a tax return is only required where you have assessable income over 120k this is something where there is no doubt, although it is possible that the RD, if it has details of the remittances, could ask for clarification.

He was Pravit's boy and allegedly his bagman. But now Thaksin is back he feels invincible because his father was the police driver of Thaksin's (ex)-wife's father who was a top police general.

I understand your logic and respect your decision but I am still personally of the opinion that an informal, unauthoritative tax guide is not something that AN should be doing. I am not surprised no one stepped into the breach. If comments are tightly controlled, it will not generate meaningful traffic anyway.

I agree the interview with RD official Nathanan Junprateepchaiat the Swiss embassy raised many more questions than it answered. He did confirm that gifts from overseas to spouses in Thailand were exempt up to 20 mil but he also contradicted himself by saying that gifts to children were not exempt having just said that gifts to direct ascendant and descendant relatives were OK. What is a direct descendant relative, if not your child? It was just a superficial attempt at PR with a embassy but when you analyze it, he was so confused and vague that it was useless. And that is a senior official the RD assigned as a spokesman on the subject. What hope for RD officials dealing with tax returns from expats living in Nakorn Nowhere.

Yes, your remittance to her Thai bank is a remittance and is assessable income for her, assuming you are not married. There is an RD case about exactly this. A Thai woman received remittances from her foreign boyfriend abroad and it was deemed taxable income because they were not married. If married the RD would have accepted that the remittances were gifts from a spouse which is tax exempt up to 20 million baht a year. If you gave her the money in cash and she hand carried it back to Thailand, it is also assessable income. However, if you were able to get Thai baht in HK, there is no way it could be detected, unless it were more than the amount of cash allowed to be carried out of HK or the amount allowed to be carried into Thailand and she was caught by customs at either end. I think the HK export allowance is the lower amount and is about US$10,000 now (previously no limit). If she give her USD or other foreign currency, she will have to show her ID card to change it at a license forex dealer, although I doubt that goes to the RD. She could also change it with an unlicensed forex dealer without ID or with a friend who wants to travel overseas. USD cash no longer seems useful in the US as everyone has gone cashless now and $100 bills have always been treated with suspicion.

I thought you said you were not going to have anything to do with the tax guide or any tax threads only a few days ago.

I think that is going to be a big problem. If even the RD legal officers at the provincial level have not bothered to study the DTAs and have no opinions on how to apply them, what hope is that an RD officer in Nakorn Nowhere is going to be familiar with the details of the 60 or so DTAs and will suddenly know how to apply them, having never had to before. In his article when P. 161/2566 first came out Prof Kitiphong, a leading tax lawyer and former chairman of Baker McKenzie pointed out that the fact that the RC has never been amended to reflect the existence of DTAs and that it thus doesn't confirm that DTAs are even applicable to PIT could be a problem in implementing this arguably unlawful RD order. There is just one ruling on record relating to use of DTAs vis a vis PIT which relates to income from temporary employment abroad which apparently came about because the RD was reluctant to accept the tax credit from the tax paid overseas. There are no rulings on DTAs applied to capital gains or other investment income or pensions or anything else. There is no regulation on which method will be applied to DTAs - 1) tax everything in full and let the taxpayer claim a refund from the other state; 2) don't tax anything that has been subjected to tax in the other state; 3) demand the difference between Thai tax and the tax rate already paid in the other state, if the Thai rate is higher. There are indications the RD intends to use method 3 but there are no regulations to that effect. RD officers could easily choose to demand full payment of Thai tax and let the taxpayer claim a refund of tax paid. That saves them the trouble of studying the DTAs and being accused of not collecting enough tax and many will be scared of being accused of taking a bribe to reduce a tax bill. They will not get into trouble for charging too much. The RD officer in the interview with the guy from the Swiss Embassy said they will not be issuing any regulations about DTAs and hinted it will be up to individual officers to decide how to apply them. Since it is not a law and is probably unlawful anyway, it would be difficult to issue regulations to support it. If the order gets successfully challenged in the Tax Court, the RD would be digging itself into a deeper hole by issuing unlawful regulations to support a non-binding, unlawful order.

There are influential figure criminals all around him - when he goes to cabinet meetings, when he goes to pay obeisance to his boss. He could them all arrested any time.

Another interesting question that comes up is whether foreign pensions are classed as income from employment. Income from employment is exempted under Royal Decree 743 on LTR visas. It is also subject to a tax allowance of 100k or 50% whichever is less for those who don't have LTR visas. Re-looking at the Revenue Code I think foreign pensions are counted as income from employment, as it is listed under Section 40 (1), even though Royal Decree 743 doesn't specify pensions which unhelpful, given that it is partly directed at wealthy pensioners. There is nothing in Section 40(1) to say that only Thai pensions are covered. However, I think it should technically be income directly from a former employer. So income from a private savings type pension or a lump sum taken from a pension pot and used to buy an annuity might not pass and may be classed as investment income, if subjected to scrutiny. 40 (1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.4

The answer to the question about what are the consequences of an individual tax resident not filing a PND90/91 tax return, if he has income over 120k but not enough to pay tax is that there is a fine of up to 2,000 baht for this under Section 35 of the RC. Section 17 is the relevant section in the context of Section 35. The amendment to require tax filings by people with no taxable income seems fairly pointless and it would obviously create a nasty backlash, if the government ordered the RD to raise a few billion in fines by rounding up millions of low income earners and fining them all 2,000. Section 35 Any person failing to comply with Sections 17, Sections 50 Bis, Sections 51 or Sections 69, unless in case of a force majeure, shall be subject to a fine not exceeding 2,000 Baht. Section 17 is the relevant section in the context of Section 35. Section 17 In relation to tax return filing, it shall be filed within the time limit specified in the Chapters regarding taxes and in accordance with the form prescribed by the Director-General. The amendment to require tax filings by people with no taxable income seems fairly pointless and it would obviously create a nasty backlash, if the government ordered the RD to raise a few billion in fines by rounding up millions of low income earners and fining them all 2,000. So I believe the RD has never been instructed to follow up on these non-filers. I expect this will continue to be the case but who knows what they decide to do. In future they may track everyone better and mail out reminders to file tax returns or, horror of horrors, may require tax returns from foreigners renewing visas. This latter actually seems quite possible, as foreigners are expected to have income over 120k for long stay visas. So logically they should have copies of tax filings. However, I think it would take some years to get to this, if they ever do.

I agree. That could be used as an excuse to get rid of the LTR tax exemptions. Under the old interpretation the LTR exemption was actually redundant, as it was no different from the exemption available to any Thai or foreign taxpayer. But now it stands out like a sore thumb.

Actually the RD issues its own exchange rates for a long list of currencies that apply for certain periods for calculating tax. So, in fact, the officer should not rely on the evidence of the actual exchange rate produced by the taxpayer but is supposed to look up the RD official exchange rate for that period. However, if you have evidence of the remittance, you will have evidence of the exchange rate used by the bank anyway. To compute baht value of a tax credit would the exchange rate of the period in which the remittance was made be used, or the date on which the tax was paid creating the tax credit or the date the income arose? Who knows? Probably 3 different RD officers will give 3 different answers. From the document you linked it looked like the Dutch DTA is more detailed than most of the others which tend to all look the same. The RD would probably need at least 5 years to prepare to implement DTAs which are not even supported by anything in the Revenue Code and there are very few cases regarding Thai implementation DTAs for PIT because under the original interpretation there was hardly any need for anyone to pay PIT on remittances.

A loan is definitely not taxable income but loan documents would definitely be requested if audited by the RD. Don't forget that you have to pay stamp duty on any agreement made in Thailand, which the RD will pick up on (don't ask me how I know this). If you have a BVI company to make the loan, you need to be careful that a BVI company extending interest free loans will be deemed "in scope" which means that it has to pay staff or a service company in the BVI. I was looking at this but decided against it from the BVI perspective. It probably applies to the Caymans and other jurisdictions too.

The BOI is, indeed, under the PM but LTR was conceived under Prayut, not under the current Thaksin regime, whose brain child was Thai Elite. So LTR is effectively orphaned under this government and has been way less successful in pulling people in than was projected. I don't expect the government would issue another Royal Decree just to scrap the tax exemption but it could be repealed "in the interests of fairness" in new legislation to amend the RC, as there is no one in the current government who would resist that. If so, it would be applicable until LTR visas expire.

But Royal Decree 743 only exempts income from employment, business abroad or derived from property abroad, if earned the previous year and remitted to Thailand. It could be argued that a company pension paid directly by the company counts as income from past employment, even though you are now longer in employment but pension income is not specified which is odd, given that it covers wealthy pensioner LTRs. I would definitely clarify with the BOI.

Up to 20 million per gifted by ascendant relatives (parents) is exempted under the gift tax amendment. So you should be fine.

You didn't mention which DTA you were looking at but in the UK one and most others the types of income you highlighted -income from an employment, or from business carried on abroad, from a property situated abroad or income from a state pension - may be taxed in the UK (and/or Thailand) and the RD has indicated it will indeed tax all of those. Where the DTAs say "may be taxed" that means there is an option to tax them and thus either or both parties may opt to tax it. Where DTAs say "shall be taxed" that means it is mandatory to tax the income in that country and the other country shall not tax it. In the case of state pensions the US is the only country I am aware of that insisted that its state pensions (social security) shall only be taxed in the US in its DTA. Most other countries have an exemption for government pensions of former government employees but not for state pensions paid to all citizens.

I always thought it was not OK to publicly discuss other members in the thread.

This is insane. The government is taking a third from this year's budget, a third from next year's budget and borrowing a third from BAAC with no plan on how it will repay the loan. The loan for Yingluck's corrupt rice pledging scheme 10 years ago has still not be fully repaid, as far as I know. The economy not in crisis as PM Srettha-Thaksin claims. It just suffers from chronic structural problems due to long term mismanagement and failure to make it competitive by reforming education, investing in R&D and a lack of investment in worthwhile infrastructure (not land bridges). So after resorting to such ruinous means to fund the thing, what recourse will there be, if the economy enters another real crisis - another crippling loan from BAAC, allocations from future budgets after 2026?

As you say 2024 was just used as an example because it is the current year but in 2025 LTR holders will have exemption on remitting the types of income specified in the Royal Decree that were generated in 2024, which will not be possible for those who are not LTR visa holders, including Thai citizens.

This company's advice is in line with Royal Decree 743 and spot on about foreign income being taxable, if remitted in the same year it arose. The only part I would question is whether dividends earned in the prior tax year would be exempt, the decree is specific about what type of income is exempt and it doesn't include dividend income or capital gains from equities. It specifies exemption only for income "...from an employment, or from business carried on abroad, or from a property situated abroad, and brought into Thailand." Interestingly pension income is not specifically exempted which may be a blow to LTR visa holders in the wealthy pension category, if interpreted literally by the RD. However, it could be argued that an occupational private pension is income from an employment but a private pension set up by the pensioner which is not directly paid by the former employer would be a stretch. This interpretation also cannot be applied to state pensions, although US SS is exempted in the US DTA. In addition there is no mention of interest income or any other investment income other than from property, e.g. gains from precious metals or crypto. They could have just said LTR visa holders were exempt from tax on any assessible income under Section 40 from the prior year but that is not what they said. It is interesting that the tax exemption offered to LTR holders by the BOI was at the time of the Royal Decree the same tax exemption offered to everyone. Whether by luck or judgement the BOI managed to get it put into law, so that LTR holders could retain the privilege in spite of a flaky reinterpretation by the director general, who is now permanent secretary for finance. Royal-Decree-743 LTR visa tax.pdf

Right the guy that sold the Prayut cabinet on the LTR visa scheme projected a million LTR visas in a fairly short space of time. Now that he and the Prayut government are gone, this may well be an orphaned project. It was put under the BOI which is part of the PM's office to prevent Immigration interfering with it and they must have been furious. At the time the tax exemption wasn't thought a big deal because it was so easy to avoid tax on foreign source income by remitting in the following year. But now it is a big deal. Since LTR no longer has a champion in the cabinet and it has sold far, far less than billed, it would easy to see it scaled down with some privileges withdrawn, e.g. the tax exemption, in future. But since that came from a Royal Decree, it takes a bit of effort to cancel it but it might happen when there are other amendments to the RC to be made through a Royal Decree or an Act of Parliament.

At least they didn't murder anyone like that gruesome school headmaster.

A 5% tax rate on gifts to spouses or ascendant or descendant next of kin is applied, only if the gifting exceeds 20 million in a tax year. What makes you think a spouse cannot use a gift to buy property? And what do you think are the criteria the RD uses to determine hat a spousal gift is a true gift or otherwise, particularly given that all assets acquired by either spouse after marriage are immediately deemed common conjugal property under the Civil & Commercial Code. The law has been on the books for 9 years now. So you should be able to find ample evidence to support your interpretations.

It is 20 million baht a year, not 1 million. The gift tax law was introduced in 2015 in tandem with the revived inheritance tax. The law appears very broad and doesn't place any particular restrictions on gifts to spouses or what they may do with them. There is only one known case where the RD has challenged gifts remitted from overseas and that was on the basis that the couple were not officially married. So the gifts were deemed not to qualify as exempt gifts on that basis. I attach the law and the case. In lieu of more detailed information or regulations on this from the RD, you need to use your own imagination to interpret this regulation, as many posters have already done copiously here. Gift Tax 2015 EN.docx Gift Tax Case RD KK0702-530 11 Feb 2023.docx