Mike Lister

It is not my role to approve anything, simply to try and help when asked and to provide input. I'm happy to debate this topic with you but must insist you don't personalise it towards me, which is the direction your post above is moving towards. Debate the post, not the poster, please.

"Under section 41 of the Revenue Code an individual Thai citizen or foreigner who lives in Thailand for one or more periods totaling at least 180 days in any tax (calendar) year is, for tax purposes, deemed a resident of Thailand and subject to tax on all assessable income derived from sources within the country, whether paid within or outside Thailand, and on assessable income derived from foreign sources to the extent that it is brought into Thailand in a year in which income is received. A non-resident individual is subject to tax only on assessable income from Thai sources, regardless of payment location". Above/Below is as told to you many times, persist in making your false and partial claims/quotes and face a warning. https://www.thailandlawonline.com/table/revenue-code/#:~:text=Under section 41 of the,from sources within the country%2C

You monopolised several hours of my time yesterday Cyclist, today is somebody else's turn, so no, no questions. https://www.accaglobal.com/gb/en/student/exam-support-resources/professional-exams-study-resources/p6/technical-articles/double-tax-agreements.html

I agree there were consistent budget deficits but they were not large by any means, the IMF even encouraged the government in 2021 to use larger deficits to build out infrastructures, which they have done. Mostly this was because the country's debt levels are so low, around 60% of GDP plus around 96% of that debt is in THB with almost no foreign debt. Most of the deficits over the years have resulted from handouts and giveaways to the rural poor which were not budgeted.

The main tax earners are VAT and Corporate tax, the aim of the Revenue is to increase the tax net which in part is what the new ruling is all about, catching Thai people with untaxed offshore earnings. BTW, the size of the grey or informal economy is estimated to be equal to 48% of GDP or around USD 260 bill. per year. These are people who work cash in hand and or don't declare or sub declare their earnings.

Only 11% of the labor force (38 million people) file a tax return, only 6% pay tax. Many of the 5% who file a return but don't pay tax are similar to my wife. They are self employed and make substantial incomes whilst taking advantage of generous allowances that benefit small traders. At the risk of repeating myself yet again, (which I know annoys some posters), my wife just paid under 10k baht tax on last years sales of 1 million baht and a profit of over 600k or 50k a month, all legit, all declared, all above board.

My point is that it's foreigners from overseas who come to Thailand and buy property, many of them are unable to sell property in their home market because rates are high and markets depressed, ergo, they are unable to free up funds to buy here. I am one such person, I have property in the UK I want to sell but can't because of market conditions. I will wait until Spring and then maybe try again, when I do sell I will import those funds to Thailand will buy a rental property here.

I have an interest and back ground in finance and economics plus I've lived here for over 20 years. I'm keen to help people understand the tax issues and producing the Simple Guide is a vehicle for that. I can't help that people think I have other motives, nor that they think they are being told to file tax returns and pay tax unnecessarily, that's their comprehension issue. I must have had over 50 posters contact me directly in the past two weeks, asking for help in understanding the issues and putting their minds at rest. I feel pretty good that I've been able to help and I get nothing out of this apart from stress and long hours. Inevitably there will be skeptics out there, again, it's their problem to deal with, not mine.

I fail to see your link between the new tax rule and the decline in the property market, is there one? Much of Thailand would still comprise fishing villages were it not for backpackers, tourists and pensioners, Hua Hin is not unique in making progress in that respect. Global property markets have fallen because of higher interest rates, that's not a Thailand tax issue. https://www.reuters.com/markets/poll-global-house-price-downturn-fades-most-markets-rise-2024-2023-09-01/

I agree, the property market in Thailand is reliant on foreigners to a greater degree, particularly in places like Phuket. Interestingly, we have not heard much from the property sector who if they were really hurting because of the new rule, would have been screaming by now. And let's not forget, the PM is an ex CEO of a huge property company. I think the reality is that there is no real link between the two things. Property markets globally are having problems, it appears to be a buyers market. Responses on this forum to the tax issues are not representative of foreign buyers in Thailand, I'm almost certain of that. Most people who come here to buy property understand the tax issues and have taken them in their stride. What we seem to be hearing mostly is a few complaining pensioners who still really don't understand the whole business.

H. Are Pensions considered to be assessable income? According to the two links below, yes they are: if an expat receives a pension in 2024 from their work or business in the past, the pension will be taxable in the year that the expat remits income into Thailand. https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Thailand-Tax-Foreign-Income-Taxable-from-2024 2.1 Under Internal Regulations In Thailand In Thailand pension income is regarded as assessable income under Section 40 (1) of the Revenue Code. https://www.rd.go.th/fileadmin/download/nation/Norwegian_answer.pdf https://aseannow.com/topic/1316818-personal-income-tax-guide-for-foreigners-thailand/

My wife runs a baked goods business via the internet, she started it four years ago, why?

There are several other threads in this section asking similar questions, you may wish to read those first.

Nobody in these threads about Thai tax have suggested that anyone should file a Thai tax return unnecessarily. What has been advised is that all readers should examine their tax status in Thailand and act accordingly. The purpose of this and other threads about tax are to advise and inform, not instruct. Will you please explain what you mean by Revenue practise regarding foreigner's and explain how you know it hasn't changed.

Added and closed H in the unclear items at the end: H. Are Pensions considered to be assessable income? According to the two links below, yes they are: if an expat receives a pension in 2024 from their work or business in the past, the pension will be taxable in the year that the expat remits income into Thailand. https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Thailand-Tax-Foreign-Income-Taxable-from-2024 2.1 Under Internal Regulations In Thailand In Thailand pension income is regarded as assessable income under Section 40 (1) of the Revenue Code. https://www.rd.go.th/fileadmin/download/nation/Norwegian_answer.pdf

I agree, I think it's important the Revenue doesn't go after tax dodging foreigners too, whatever next!

Another report from Australia

I've updated Section 33 of the document in the OP, unresolved issues A & F are now closed until new evidence confirms otherwise: 33. UNRESOLVED, CONFLICTING or UNCLEAR ISSUES A. The exact nature of the imported income taxation rules between the Thai RD and countries with whom it has DTAs Individual DTA's are available for download and inspection, they are all different. Thai law appears to state that all income is assessible, until it is proven to be otherwise. F. If, as far as expats are concerned, the existing tax code/law really does pertain only to income derived from inside Thailand, which existing tax code rules, obliges resident expats who receive offshore income to file a tax return, eg is Section 40/41 intended to include such people or not? Section 41 of the RD Code is very clear and pertains to overseas income hence foreigners are required to declare assessable income, under the existing code.

And yet again: Expatriates living in Thailand also raised concerns about unclear tax conditions on taxable foreign-sourced income. One point raised is whether the pension fund they receive from their home country’s government will also be taxed when remitting into Thailand. Under the new interpretation, the pension fund is likely to be considered income from a foreign source that is taxable if it is related to the employment or business of the taxpayer overseas. Therefore, if an expat receives a pension in 2024 from their work or business in the past, the pension will be taxable in the year that the expat remits income into Thailand. https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Thailand-Tax-Foreign-Income-Taxable-from-2024

And another, albeit from the Revenue itself: 2.1 Under Internal Regulations In Thailand In Thailand pension income is regarded as assessable income under Section 40 (1) of the Revenue Code. A resident of Thailand must declare his worldwide income on the basis that the income received from abroad in a tax year must be brought into Thailand within the same year, based on Section 41 paragraph 2 of the Revenue Code. https://www.rd.go.th/fileadmin/download/nation/Norwegian_answer.pdf

Another anecdote: "A wealthy pensioner residing in Thailand for at least 180 days is subject to a tax rate under the new tax law. Pensions brought from their country of origin may not be subject to the law if the person can prove that they have been taxed prior to being transferred to Thailand". https://www.siam-legal.com/thailand-law/relationship-between-the-new-thai-tax-law-retirement-visa-holders-and-long-term-residency/#:~:text=A wealthy pensioner residing in,to being transferred to Thailand.

We can always hope that will be the outcome, I certainly do. But pensions take so many different forms, its not exactly simple to see what is a pension and what isn't. UK State pension is easy, company pensions get slightly harder, annuities even harder whilst SIPP's are a nightmare, are they all intended to be free of tax? RMF's are free of tax if held for the minimum period, seven years as I recall, LTF's are the same. I cashed a LTF after 5 years and paid 5% tax. Those investment products are not age or work related, they are mutual funds that must be held for a minimum period and can be paid for from savings rather than income, not quite the same as a pension. Moving on: Regardless of the eventual answer, I think we need to standardise the verbiage. Just because money received in Thailand is income to you, doesn't mean that it is income in the RD sense. I propose: Remitted Funds - All money received in Thailand Exempt Income - Remitted funds, exempt from assessment by virtue of the DTA or RD T&C's, eg savings. Assessable Income - Non-exempt remitted income that is subject to TEDA (Tax Exemptions, Deductions and Allowances) Taxable Income - Assessable income less TEDA, funds that are subjected to the Tax Tables. Lastly, in light of yesterdays exchange about what is assessable income and the understanding that all income is assessable until it is not, let me once again put up our definition of Assessable Income to see whether or not it can be agreed: "Assessable income in Thailand is any income that was remitted to Thailand and was earned after 1 January 2024, whilst tax resident and which is not exempted by the DTA between Thailand and your home country, or by the Thai RD". And this one: if anyone is going to a RD office for any reason, perhaps they can ask the simple question, does the Thai RD regard overseas pensions as assessable income? Lastly and purely anecdotal: Four years ago at the RD with my wife, whilst doing her business taxes, I asked if she could claim for the cost of my health insurance. The normally nice RD lady wasn't pleased at my question and became stern for a moment, her reply was, yes she can, but that would mean we have to look at all your overseas pension income. I didn't so they didn't! Which is one of the reasons why I don't think there's necessarily a blanket exclusion on overseas pensions by the RD.

Yes

Because in law, as another poster in another thread so conveniently just posted, "In general, all types of income are assessable unless expressly exempt by law". Separately, whilst I'd love to continue this with you, I've had a full day of Thai Tax on AN and then some, don't be upset if I have a break and pick this up tomorrow.

Why Jim, does that mean you don't agree! 🙂 Can you please point me to where it is said that a DTA between any two countries is all inclusive of every type of consideration and that anything that is not included, is non-taxable, by default....please