Klonko

1 hour ago, Mike Lister said:

Can we be clear what you think my approach to Gift Tax is, because to the best of my knowledge, I don't recall ever setting out any approach? The Introduction to Personal Tax concludes the following on the subject of Gift tax, which really does mirror my personal views:

 

"Because Gift Tax is predominantly a domain of the wealthy and depends to a large extent on local practise, there is a shortage of confirmed information on this subject". And,

 

"Members wishing to exercise this option should seek qualified advice before using this option to Gift untaxed funds". And,

 

"Until this becomes more clear, it is critical that anyone wishing to use Gift Tax, seeks professional advice".

 

 

 

Very clear before my post. Exclusively recommending professional advice for any gifts is a restrictive approach. It is your tax guide and your choice not to elaborate on publicly known parameters.

Based on my experience with a reputable Thai tax consulting firm last year, which did not provide specific answers to specific questions, I would not expect too much clarification beyond the known parameters (traditional gift) and each one has to make his or her own assessment. Given the Ferrari example it is not necessarily a domain of the wealthy. 

18 minutes ago, redwood1 said:

 

So expats could Gift each other 2 or 3 or 5 million baht a year...

 

 2 expats with good harts giving each other money....I would consider that very legitimate.......

And and to show what a true friend you are you might just want to gift your friend a few million every year....And your friend would return the favor....

 

Thailand can be known as country full of expat gift givers...

Now that will be some good PR for Thailands expats...

Although I consider Mike's approach to gifts as too restrictive and  have set up a structure with a gift component for myself, IMO your structure is tax evasion.

6 minutes ago, Lorry said:

I don't get that.

 

If Mr U sends a birthday gift of 1m THB from his US account to his friend's (Mr T) Thai account, Mr T would have to pay Thai gift tax (if over 10m). Sure.

And don't let us talk about US taxes.

 

Imho, Mr T does not have to pay personal income tax for this 1m, because it is a gift.  No matter,  whether any income tax in any country has been paid for this 1m.

Nor does Mr U have to pay Thai personal income tax for this 1m. He never got this money in Thailand.  (Ok, @Etaoin Shrdluthinks he got that money for an imaginary microsecond - it was still Mr U's money on the way between crossing the border and landing in Mr T's account. So, what if Mr U transferred the money to Mr T's US bank account, supposed Mr T has a US bank account?).

Am I mistaken?

 

RD 161/2566 specifies which kind of income are taxable according to RD 161/2566 - gifts are not. That has been clarified by the RD in the video Klonko posted.

Neither are inheritances, BTW. Bringing inherited money to Thailand you shouldn't have to pay personal income tax, but inheritance tax if over 100m THB. Regardless of what taxes have ever been paid for the inherited money in any other country. 

Imho.

 

I may be completely wrong, I am financially almost illiterate, please elaborate. 

 

 

 

 

The THB 1m gift is not subject to tax if it can be classified as traditional gift. In your example, it depends on the circumstances if it is a traditional gift.
 

AFAIK inheritances are taxable regardless of remittance to Thailand.

3 hours ago, JimGant said:

They've never said that. Assessable income, whether remitted to your bank account, your GF's bank account, a PO Box, or a shelter for soi dogs -- is still remitted assessable income, subject to Thai taxes, if it exceeds exemptions and allowances.

 

Where folks are getting confused is -- unlike in the US (and I assume other Western countries), the gifter is the one who pays the gift tax (or gets a credit towards a final estate tax). And it is a gift tax, not income tax, on after-tax income, i.e., disposable income now inclusive in the estate. Thailand, however, apparently taxes the recipient, not the gifter:

 

Thus, a gift to your GF is totally divorced from your taxability on this money -- that action is separate from the gifting action. Now, your GF is in an interesting situation. If she gave nothing of value for the receipt of that gift, then, yes, it is a gift -- and she'll have to file a personal income tax return to declare an amount over 10M baht. However, if she gave several really superb hum jobs, she gave value for the money received -- so now she has to declare the whole enchilada as income. In both situations, she's the one filing a tax return for the money you gave her, not you adding this on to any tax return you had to file. But if that gift you gave was assessable remitted income to Thailand -- you've got to declare it on a tax return, as it has no exclusionary aspects by later becoming a gift (or income for rendered services). Sorry, folks. The gift aspect doesn't seem to be a viable tax avoidance. 

The Deputy Director of the Legal Affairs Division of the TRD (Swiss Embassy Townhall February 27, 2024):

1 hour ago, Lorry said:

 

a friend will bring money into Thailand that he inherited in his home country. He can easily prove the money has been inherited. It should be tax-free, right?

(Thinking about it, I could do the same,  but I might have comingled the funds already,  I will have to check)

AFAIK Thai tax residents are subject to inheritance tax on inheritances received regardless of the domicile of the testator, the country of inherited real estate (often not protected by DTA), and the remittance of inherited funds to Thailand. However, exemption thresholds are high and inheritance tax rates low. Better to file for inheritance taxes if necessary, at least when you plan to remit inherited funds to Thailand.

3 hours ago, JohnnyBD said:

And, many many more never filed and it wasn't strictly enforced.

My question still stands, what makes some think this will be strictly enforced now?

TRD will probably set up a system to tap the broader tax base after the the following year remittance loophole has been closed. I do not expect strict enforcement because the cost outweighs the benefits for TRD. I consider a THB 220k remittance hurdle not to be efficient. A non tax paying Thai tax resident remitting THB ≥ 1m per year could be a promising target and better does some tax planning. May be the retirees with the minimum required income will fall out of scope, but nothing is granted.

4 minutes ago, Mike Lister said:

… And who knows, we may yet find out that TRD doesn't have a policy on commingled accounts and decides against having one, wouldn't that be nice!

Nice if the TRD officer is lazy from a tax collection point of view. Less nice if the TRD officer chooses the accounting method which is maximising tax collection. I do not expect TRD to establish consistent rules on accounting and DTA. I would be happy to be proven wrong.

6 hours ago, Mike Lister said:

…. We are not aware of the TRD policy regarding commingled funds or even if one exists. If you hold funds in this way, until such time as the TRD policy on this is made clear, you only have two options open to you. The first is to keep detailed records that describe all the feeds into the commingled account and hope that will be sufficient, or separate the sources into their own accounts.

Given your general cautious approach for example as regards gifts, I consider it quite aggressive to recommend the keeping records option even with the hope caveat. I would recommend keeping detailed records in order to be able to use the TRD accepted accounting method once, if ever, TRD has made up its mind, but in the meantime, segregated accounts are the only valid option.

4 minutes ago, richard_smith237 said:

…

Thus the ops 20.5 years of remaining membership with unlimited perks that the op is offering for 3.4 Million baht is 1.6 Million Baht cheaper than the prevailing rate - it also doesn't limit the new member to 120 points.

…

BUT - IF someone is in the market for the 20 year Thai Elite Membership - the Ops deal (and my deal) is a good one - the issue of course is that most people in this forum are not in that market and can't understand those who may be.

There are quite a few people on this forum and many elsewhere who could benefit from a lifetime Elite Membership. However, such people are likely to have already Elite or LTR visa. Further, a prospective buyer needs to play golf and live in the right area for the perks. BTW, the new point system is rather a sales strategy for cheap charlies than for wealthy people.

2 hours ago, Henryford said:

 

I would disagree. I would consider the dual carriageway to be the "main road" and thus have right of way. Anyone entering from the minor road over the railway line should give way.  In any event i always proceed with great caution at that intersection and would never cross unless the way was clear.

Crossing the intersections on this dual carriageway not being able to stop under the assumption cross traffic has to give way is, as said, recipe for disaster. You have a "stop" line on the dual carriageway way, a minor cross road,  left (car) before right (tricycle) and the tricycle on the intersection before the car. There is no common understanding of the applicable traffic rule among the drivers using sich crossings The discussion of the right of way is interesting to allocate responsibility after an accident. Else, common sense rules, and you better not drive in Thailand if you do not get accustomed to.

Better than new privilege memberships but expensive compared with LTR.

Insisting on the official traffic rules is a recipe for a disaster especially in Thailand. Both drivers were driving recklessly. I have driven both roads by car and motorcycle and never would drive across this intersection from either side without looking for other vehicles  and being prepared and able to give way even if it's my right of way. Anticipating the Thai style behaviour of other drivers, I feel as comfortable as driving in Europe.

28 minutes ago, patman30 said:

not for me to check what can be carried where and on what airlines
your statement also makes no sense
checked luggage,...... coming through security.......
which is it?
if checked he would not take his luggage "coming through security" till he gets to destination
so i will just ignore any more of your comments
all i can say is my old man has brought all sorts or tools through as have many other people i know
i think i will just trust Ai response more than a rando AN member

From my experience: air transport of (at least larger) motorcycles is limited to cargo planes. You need a box or a platform. Battery must be disconnected and fuel tank (almost) empty. It cost me >USD 4000 for  Stuttgart - New York and Denver - Stuttgart in 2005.

USD 50 may be for a small pocket bike.

AN still preferable to AI.

I plan to import front and rear shocks for my motorcycle which parts are not available in Thailand, value < THB 100'000. I would prefer to use a shipping company such as DHL if the customs clearance can be handled by them or an agent and I do not have to travel to customs. Else I could bring the shocks with me when my wife and myself will return from Switzerland. Our main domicile is Thailand. What is your recommendation (I will not gamble on the green customs  channel).

12 hours ago, 4myr said:

Would like some feedback on my tax filing example according to the Simple Tax Guide.

 

I am filing for tax resident year 2025 using this PD90 form. In 2024 I was not tax resident.

I will remit all [assessable and exempted] income cases I can possibly have in 2025, just for the sake of this example.

I never filed a tax return in Thailand before.

 

Income Excluded from PD90

According to STG, I can exclude all exempted income of RD ruling P161/2566 and DTA exemptions as assessable income, so I will not declare them in PD90, but I will keep records for audit purposes:

1. all earnings before 2024
2. all savings before 2024
3. I was not tax resident in 2024, so all earnings of 2024 I can exclude, i.e. capital gains on sold stocks in 2024, director’s fee 2024, state & company pension 2024, dividend 2024 
4. my NL DTA exempted income from tax resident years, i.e.:
   1. director’s fee of 2024/2025
   2. state pension of 2024/2025
   3. sold property in NL with profit in 2025 and remitted principal and profit in 2025 

Income declared in PD90

• item 1 / salary, wage, pension: company pension 2025 [paid NL tax 30%]
• item 3.3 [dividend from foreign company] - dividend 2025 [paid NL tax 25%]
• item 3.x / capital gains sold stocks - where I can declare gains of sold stocks in 2025? [no NL tax paid]
• item 7 / income from business or sale property: not declared sold house 2025, because exempted
• item 8 / income from sale property: not declared sold house 2025, because exempted
• item 11 / tax computation
  • 11.12 / total tax payable
  • 11.13 / Less: is this the place where I can declare my total foreign tax credits from items 1 and 3.3?

Record keeping for audit purposes
Record keeping not described in STG.

• 2025 / all foreign sourced Wise transfers to my thai bank accounts. Wise also reports exchange rate 
• pre-2023 / 2023 / 2024 / 2025 - all exempted earnings, e.g. director fee or state pension statement, deed transfer 2025 of sold house, company registry extract with names of directors, annual bank statements, buy / sale receipts on sold stocks in 2024 / spreadsheet profit calculation, dividend in 2024, optional tax assessments NL-RD 2023 / 2024 / 2025
• non tax residency 2024: I will not use eGates of Suvarnabhumi so I collect all passport stamps, reminder emails 90-day reporting, 90-day reports, boarding passes exit /entry Thailand
• 2025 assessable income
  • company pension statement of 2025 [tax credit]
  • dividend statement of 2025 [tax credit]
  • tax assessment NL-RD 2025 [accrued tax credits]
  • buy / sale receipts on sold stocks in 2025, spreadsheet profit calculation
     

It shows that record keeping and respective potential discussions with Thai RD will be cumbersome.  I have remitted a large amount in my non-tax resident year 2023. keep some existing savings on a non-interest bearing account for later tax free remittance, and I will use remittances with DTA credits only as last resort. 

1 hour ago, 4myr said:

Avoidance is I'm afraid not possible if you're a tax resident. However you can bring in money which are exempted in the P161/2566 ruling, e.g. earnings before 2024, or for which you have a tax credit evidence available. 

 

I was watching back a TRD legal expert called Khun Nathanan Junprateepchai talking to the Swiss ambassador that the Swiss pensioners should not worry, as he referred to the Swiss DTA that Swiss pensions will not be taxed in Thailand. Compare that to the position of his colleagues in my local office.

Your statement re Swiss pensions is not correct. There are two type of pensions in Switzerland, the federal first pillar pension and  the second pillar pension from employment. If the employer was the state, a public subdivision, or a local authority thereof, the respective second tier pension is taxed in Switzerland and exempt from Thai taxes. All other pensions are not taxed in Switzerland and constitute assessable income if remitted to Thailand.

Where do I get a decent espresso or ristretto like in almost every bar in Italy?

Two years ago 5 years DL at Banglamung and 3 years IDP at Chonburi. 2 year extension may be a problem because AFAIK IDP requires for 5 years DL.

10 hours ago, Mike Lister said:

Can everyone say what are their three biggest/top three issues in the don't know/unclear category, please?

(1) Accounting method  for commingled funds (no clue at all). (2) Gifts from untaxed foreign income (though I feel rather comfortable with my modus operandi). (3) Tax filing if no taxes due (bureaucratic hassle).

For 

1 hour ago, Mike Lister said:

In that situation I would be inclined to baseline the funds as at 1 January 2024 because anything earned prior to that date is free of Thai tax. I would then try to ensure that any income/interest earned on that amount, was paid away into a separate account, thus leaving the base capital amount unarguably free of tax. TBH that would be a reasonable tax mitigation practise to adopt in any country.

This was also my initial thought, but not (cost) efficient for my actively managed investment portfolio. I now work with funds remitted to Thailand in my non-Thai tax resident 2023, funds on a foreign non-interest bearing account, gifts to my wife and the possibility of DTA eligible income, ensuring a favourable tax situation for many years.

Assuming pre-Thai tax residence savings of EUR 1m generate EUR 50k annual income and remitting  EUR 50k = THB 1.9m every year. TRD has not confirmed the applicable accounting method(s) for traditional savings. Applying FIFO, no assessable income and no tax due for 20 years. Hurray, but good luck if TRD will not accept FIFO and taxes are due. In my situation I would love FIFO, but I will never risk it given the current state of information.

1 hour ago, JimGant said:

They don't have LIFO either. So, how do you assess what's principal and what's income on a chunk of fungible remittance? Like back in the first world, your competent tax accountant will recommend -- in a gray area situation -- the option that is most favorable to the client. So, under current "non guidance from RD," the competent recommendation is FIFO.

 

 

Nobody knows if TRD will apply FIFO, LIFO, poisoned account or another method, consistent across TRD offices, or leave the choice to you. IMHO only valid recommendation is to keep savings and DTA eligible income on separate non-interest bearing accounts for later tax-free remittance to Thailand. Choosing a specific accounting method now may burn you.