anrcaccount

Difficult to address your questions without starting it again, but I'll try. Of course, this has no Thai tax implications at all for the "someone else", assuming they are a Non resident. It has no Thai tax implications for you, either. This is an example of the kind of scenario that makes foreign credit card spending simply unenforceable / non auditable. You get into the realm of the absurd - Like what airline was the ticket brought from ( was it Emirates, or Thai Airways etc) and then that ludicrous example of leaving the country to purchase the ticket.........as if the exact location of the individual while the transaction was made makes a difference!! Spending isn't taxable under Thailand PIT. Income is taxable, if declared as income and assessed. If you want to declare assessable foreign income that you transferred from one foreign account to another, to pay off a credit card used for a transaction in Thailand, as a remittance of foreign income to Thailand, go ahead. You'd probably be the first individual to ever do so. But the idea of being in another country when the ticket is bought, won't make any difference.

Really? No one knows this? No readers / their families/ friends have ever owned a rental property in Thailand with a mortgage? Be great to get some experiences on this.

Proof that it is not please How about some proof, that it is a fact?

Great question. Can anyone clarify whether mortgage interest is a deductible expense for a Thai rental property? Can "actual costs" be deducted and does this include mortgage interest, typically the biggest cost? Pretty basic question, but seems that it is not clear!

In Thailand, you cannot rigidly separate the law from the practical application of it, doing so makes the discussion of little use in the real world. Income used to pay off a foreign credit card overseas, for spending in Thailand, may be considered a remittance and ‘technically assessable’, but it is practically much different to an inbound transfer to a Thai bank account. An inbound transfer to a Thai bank account is much more likely to be verifiable by the TRD. It's not EXACTLY as assessable, practically. The foreign credit card ‘spending’ is not taxable. The income used to pay off the credit card may be technically assessable, but is ‘practically non- auditable’ by the TRD. That is why, multiple established tax advisory firms state that foreign credit card usage will be “safe”. It’s ‘safe’, because it’s next to impossible for the TRD to confirm this is foreign income ‘remitted’. It could be termed ‘technically assessable but practically non auditable’. It will only be assessed, if that individual decides to declare this voluntarily as foreign income to the TRD. It would take exceptional circumstances for the TRD to even consider requesting a foreign credit card entity disclose transaction level detail, and then to have to parse and determine which of these transactions were considered ‘remitted to Thailand’. For anyone who may think this, no, the CRS regulations do not give the TRD the data they would need to even start to try and to do this. It would first take an audit (exceptionally rare) , and then, an exceptional request to the foreign credit card entity, to even start to investigate. It’s likely not a single satang of tax has ever been paid in Thailand on a foreign credit card ‘remittance’, despite likely billions of ‘assessable’ same-year income earned has been transferred between foreign bank accounts and foreign credit card accounts, to pay off foreign credit cards used to buy goods/ services in Thailand.

That is so true. Information of expats having been audited and fined for tax evasion in Thailand on their foreign income remittance would have spread like the plague. IMO few audits have happened but for substantial reasons, not by throwing darts on a list. Yes, common sense tells you it would have been reported. No doubt at all. I honestly don't believe any substantial amount of foreign income remittance Thai PIT has ever been declared, let alone someone has actually been contacted by the TRD regarding it, been investigated, and made to pay. In reality, there must be billions of baht of same year earnt , foreign income, remitted to Thailand every year by (technical) Thai tax residents.

Fair enough, based on that, I wouldn't use him for my own or friends / family's advice! That said, I do agree with his general views on the implementation of taxation on foreigners / foreign remittance. 15 months(and counting) to try an process a single, straightforward DTA credit.............. Imagine the absolute chaos that will ensue at the TRD, if even 5% of expats somehow manage to register for a TIN and file a return by March 2025.

I doubt there has ever been any enforcement of the foreign income same year rule. Never heard of a case, and it is the type of thing that would 100% definitely create news in the expat community, had it ever occurred. I would go further than this, and wouldn't be surprised, if there has been little/no tax ever paid on foreign remitted income to Thailand.

I'll agree that he talks a bit of BS ( even more later in the video re the Hong Kong stuff) , but I believe his examples I noted were factual, and I do agree with his views on the practical implementation of taxation of foreigners / foreign remittance. Plus, he actually has been doing this and dealing with the TRD for many years, unlike many other agencies that have sprung up opportunistically since the 'new interpretations' were publicised last year.

Thanks for posting this video. To balance this out, see the video from around 1:01-1:07 , where the AITA tax adviser Thomas Carden discusses his views on the practical implementation of taxation on foreigners. Note with his firm( vs others that were created only in 2023 year and are currently very actively soliciting expats), is AITA have actual experience processing tax returns in Thailand AND dealing with the TRD. His opinions are: · the TRD does now know how / if they will implement taxation on foreign remittance, and thinks further change/delay is likely. · The TRD lacks the infrastructure to handle the complexity , and secondly there is no enforced requirement to register for a TIN. · The tax code they have, and the procedures in place, and is not sufficient to handle the complexity of actually processing these returns for foreign nationals. He cites 2 examples: 1. A case where a foreigner asked the TRD to tax them on his foreign income, he was told “leave, we don’t know how to do that” 2. Another case they have been working on, where a Thai resident sought to claim a low $ value DTA tax credit from when they worked in the US for a period. They have been working with the TRD on this for 15 months to get a single credit, and the TRD is still saying “ we cannot determine how to process this in our system”. Overlay these real-world examples with the theory of processing of 300,000 expat tax returns, and consider that. Food for thought.

Because the rules are written for Thai rental income. Foreign remitted rental income has quite possibly, never been taxed in Thailand before. If you think about the different scenarios, in some of them applying that deduction defies logic. You wrote : “It was discussed a long time ago that any rental income that is remitted to Thailand would be considered gross of all home country deductions/expenses which would be replaced by the 30% Thai standard deduction, or, if actual expenses were greater and all receipts were available, the greater amount, per the TRD Code”. For example, gross rental income might expect to be reduced by agent fees, local taxes, cost of repairs etc. For Thai assessable income purposes, the amount of rental income remitted to Thailand is presumed to be gross and not to have been reduced by the value of those deductions/expenses. Then you said, you'll remit your own rental income less agent fees (net, not gross) which makes it "reduced by the value of those deductions or expenses", so going against the advice provided in your own tax guide. Anyway, as you say, you're under the TEDA so it is immaterial, to you. If you take the Thai standard deductions on this, you're either remitting actual gross , or you're remitting net, then getting additional deductions on top of deductions you've already made ( that would be a nice scenario). Beyond your own situation, consider one where the property is in fact highly leveraged and makes no profit (common in property investing) : here, you could be faced with situation like this: Gross rent: 20000. Foreign deductions including interest: 20000 If you take your guide as is worded above, you could then remit 20000 'gross income' to Thailand , claim the "actual expense method" deduction , and have no liability.

I do believe that almost all foreign income thais earned and remitted has never been reported on Thai tax returns. I also believe the TRD code does not cater sufficiently to foreign income- this view is shared by major accounting firms and business associations who have been lobbying the TRD since the new interpretations were released. Yes, it is the Wild West in many respects, and avoiding / evading tax is almost a national sport! I don't believe you can do this. Lets assume firstly getting the Thai rental income deductions ( 30% or actual) is possible on foreign remitted rental income ( I am not certain of this yet). But assuming that is the case, you would need to remit the gross and then apply either deduction method. You are not remitting a gross amount, if you remit 535 -96. There are a multitude of more complex scenarios that will create issues unless the legislation is rewritten. One of the biggest of these is, how to handle mortgage interest paid on a foreign rental property as a deduction. Many foreign property investors are highly leveraged. Right now, it looks that without legislation change it is impossible to logically apply those Thai deductions to remitted foreign rental income, if it is considered as truly gross. Either you remit only the net, and no Thai rental income deductions are possible, or the legislation is updated.

I don't agree. I think Thais have relied on the following year remittance rule + lack of enforcement, and in the vast majority of cases, simply not reported foreign income in any categories. Here are the parts of your opinions I don't believe are factual: Thailand Revenue has no interest in knowing what deductions were made from overseas funds, prior to them being remitted to Thailand. TRD is only interested in knowing whether remitted funds are assessable income and of what category. If this was true, there would be no such thing as DTA's.........they're also interested in any tax paid in a foreign country on those remitted funds assuming a DTA. “It was discussed a long time ago that any rental income that is remitted to Thailand would be considered gross of all home country deductions/expenses which would be replaced by the 30% Thai standard deduction, or, if actual expenses were greater and all receipts were available, the greater amount, per the TRD Code”. For example, gross rental income might expect to be reduced by agent fees, local taxes, cost of repairs etc. For Thai assessable income purposes, the amount of rental income remitted to Thailand is presumed to be gross and not to have been reduced by the value of those deductions/expenses. These statements are why I tried to give an example with worked figures, how would this example work under your 'facts' above? How can the amount of rental income remitted be considered gross, when it's already net of those deductions applied in the foreign country? And if it is considered gross, but then 'actual expenses were greater and all receipts were available....the greater amount" was deducted, you'd arrive at the same figure as just remitting the net, right? Try to think about the practical application of something like this, User @JimGant tried to show you a practical example of this earlier in the thread. If you do see how remitting 'gross' foreign rental income and then applying Thai rental property deductions to it would work , please do share? I'm not baiting here, I just cannot see how it logically would work, so if someone else can, great I'm all ears! This is fair enough, agree. That's not a fact, that's your assumption.

Thanks Mike, a useful response. Can I just point out a few things that highlight the difficulty, complexity and lack of clarity present, (in what may be) - trying to apply existing regulations, that are designed for Thai sourced income to foreign income. So, maybe, you can just use the remitted (net) value, and then 'not try to' offset any expenses incurred in Thailand ( of which, of course, there are none, for foreign rental income) . Or , you can use some kind of calculation as you've attempted, where you use the gross income and claim a portion of receipted expenses in Thailand ( again, none of these expense have been incurred in Thailand) Or, maybe, you can deduct an additional 30% off the net remittance? Who knows, while that seems unlikely, it is no more implausible than the other scenarios. The only thing that’s clear is - the funds you have remitted to Thailand are already, in reality, net of deductions in a foreign country. The deductions have been spent on the property, and the net is the subject of the remittance. This point is very valid and again highlights the complexity and uncertainty, again. Where are the permitted deductions for Thai investment rental income listed? Is mortgage interest one of them (there is a blanket 100,000 deduction available for ‘residence mortgage interest’, does this include foreign investment property ?) Surely, this is fundamental, basic information for any Thai who owns property ( on or offshore), but it would appear that these scenarios are not well known. These type of questions, show why many major tax firms believe taxation of foreign source income is practically impossible in Thailand via referring to existing legislation ( that is not designed or written for foreign remittance scenarios) , and significant overhaul and time, will be required before this can be applied, in practice.

OK. Seems difficult to apply your wording to reality. Let's try an example to see if I am understanding your opinion on this: Foreign gross rental income - 20000 Foreign expenses deducted ( e.g. agent fees, maintenance, interest on mortgage, etc) - 10000 Net before tax - 10000 Tax paid in foreign country - 2000 Remaining- 8000 8000 is then remitted to Thailand. How would you see that the TRD computes the assessable income, deductions, and tax credits (assume dta) in this scenario?

Only you are interested in the US DTA, the poster I responded to is a Brit. Goodbye. Yet, Britain has a very similar set of deductions for rental property taxation as the US, which makes the advice/observations given that Thai deductions of 30% (gross) apply on foreign remitted rental incomes, equally invalid and assumptive. These type of statements, including ones like the below, are simply opinion, and not based on any established facts or professional accountancy advice: It was discussed a long time ago that any rental income that is remitted to Thailand would be considered gross of all home country deductions which would be replaced by the 30% Thai standard deduction, or, if actual expenses were greater and all receipts were available, the greater amount

You are certainly over thinking my response! You also seem unable to engage with posters who do not agree with your "informing", or challenge your assertions. I'd be very careful with taking guidance from an agency that was created in October 2023, that would logically have limited practical experience filing Thai tax returns and dealing with the TRD. If one of the established accountancy practices has any published advice re standard deductions on foreign rental remittances, it would be great to see it. As you say- many Thais do have investments that include rental property overseas. What I suspect (and happy to be shown as wrong) , is that in practice they have never paid thai tax on remittances of this income, regardless of year received. If it was common practice for Thai tax to be paid on this, there would be more published information available. This scenario, which is one of many similar, highlights the difficulties inherent in the application of new POR interpretation. Without significant further guidance from the TRD, consistent and practical application of thai taxation of foreign sourced income is going to be next to impossible. Several major accounting firms and related associations have been highlighted this and have been actively engaging with the TRD.

Right, but you just advised the poster that this standard deduction applies to both Thai rental income and foreign rental income, remitted to Thailand. If anyone has this advice from a Thai tax consultant, I'd be interested to hear it. Almost any foreign rental income is net of deductions and tax already paid overseas. To apply a standard deduction on gross rental income remitted, does not seem to make any logical sense. In addition, whether the standard deductions can apply to different income categories 1-8 as listed in your link, if these types of income were earned in a foreign country and remitted. This, again, appears to make no logical sense, as the regulations appear to be written, for only Thai sourced income.

Both, either/or So, are you advising that a foreigner (Thai tax resident) who remits rental income from a property located overseas, to Thailand, can claim a standard 30% deduction on the gross income?

Please, can we stop the tax discussion on these visa related threads. There is far too much if it , there are many dedicated tax threads to have that discourse in, and it adds no value to these visa news threads , just creates another same/same circular discussion. .

Spot on, so many reports of approvals already. I believe 5000 + have been issued already, and this program has already resulted in more visas issued than the LTR , as a comparison.

I wouldn't be surprised if an Immigration officer at the airport cannot even tell if the DTV was granted for soft power or Workcation purposes. Let alone, access the specific details of what proof was provided at the time of application. If I had to guess I'd say they'll just see DTV and stamp it in.

I understand your point of view, but I don't agree. I think this visa is designed specifically to let people stay as much as they like for 5 years. They want people to stay here long term, it is why they released this visa. It's already attracted thousands of applicants and approvals in a relatively short time. They really could have just made it a 5 year METV but having the "purposes" of workcation or soft power probably helped them get this setup internally.

I don't agree based on the intent of the visa program and the statements of the foreign ministry so far. It's essentially a 5 year tourism visa. You don't have to "maintain" it, it's valid for 5 years, unlimited entries in that time. Once it's in your passport you're good to go in/ out for 5 years and are unlikely to be questioned at any land or air border. The visa is valid for entry. It's been granted to you. This is based on whats been said currently. It's not like the Education Visa. The exception which is unknown currently, is the in country extension process, which can be avoided altogether of desired. But if you do extend, there's 2 ways this could go. One is you have to show your "purpose" is still valid i.e. Proof of soft power or Workcation. Second and IMO most likely is - its just a extension fee tick and flick exercise, you pay 1900 baht and some photocopies and you're extended for another 180 days.

I think over time there'll be far more types of activities accepted under "soft power" than have been currently. There's far more to it than Muay Thai and medical appointments. Other examples mentioned are attending concerts / events and "sports" but yet to see many of these alternatives reported as accepted. Agree that thai language courses should definitely qualify. If you struggle 1 just book a medical or dentist appointment, seeing many reports of these being accepted even without any long term treatment plan. Then you can do whatever you want when you arrive, study Thai to your hearts content.