Mike Lister

So does the gift become ring fenced perhaps and excluded from marital assets, in the event of a subsequent divorce....dunno. I guess that's the risk that needs to be considered, the husband gifts funds to the spouse to avoid tax and ends up losing everything in the divorce court.

The point is that any potentially taxable event is formed when the person arrives at the hotel and accepts the offer and hands over their card to the hotel in Thailand and provides consideration. That is when the contract is formed. That means that IF the TRD considers spending on overseas CC to represents assessable income, the liability occurs at that point.

Back to the idea of Gifting funds to a spouse. Most people seem to agree that this form of Gift is allowable, unless the Gift is discreetly returned to the Gifter, in which case, it can be seen to be tax evasion which is illegal. But also in play in this scenario is conjugal property, which says that assets acquired after marriage are owned 50/50. In a hypothetical example, presumably,4 the Gifter gifted the funds to his wife, from pre-marriage owned assets which means the gift is valid, but what about after it is received? Is that Gift still owned by the wife or did it become conjugal property once it was received? Or more likely, is that gift ring fenced and excluded from conjugal property? Ooo, how exciting, I do love a good mystery. It should be clear to everyone by now that Gift Tax is not as straight forward as first thought and that there are plenty of potential pitfalls along the way.

Obviously a Keith Moon fan.

https://ltr.boi.go.th/

A contract needs three things in order to be formed, an offer, acceptance and consideration. When the hotel in Thailand offers you a rate that you accept, the consideration is provided by the credit card. Services have been provided here, you accepted those services here and you provided consideration, the contract has been formed at that point. The charging and billing components overseas are not relevant, that's just settlement, back office stuff.

'Tis done.

Agreed

Can I just say that a loan is a different beast to a revolving line of credit and a credit card is not the former..

is.........:)

Er, no, the bank is remitting the funds to Thailand to pay for your purchase, they are acting as your agent.

Income is income, no matter that it is remitted in different ways. Cash, TT, debit card, cheque, bankers draft it doesn't matter, they are merely different vehicles for moving funds. A credit card is a debit card with an extended payment option, no more no less. A debit card is the new way to write a cheque and a phone app replaces all of them. But they are all the same basic things, a way to move money from A to B. Has the TRD addressed CC's? Certainly the TRD is aware of CC's but they are very unlikely to have a policy or documentation on them specifically, why would they, they are just another ways of moving money. The TRD is interested in income, no matter how it is moved. Now, would I personally declare my CC receipts as part of my assessable income? No I wouldn't, not unless it comprised substantial or frequent expenses or extended periods. If it's casual spending, I wouldn't bother.

Jim, why so uncertain, I hate people who sit on the fence. 🙂

You say that a debit card transaction is considered assessible income, because it reduces your bank account balance, but not a credit card, because it doesn't do that.....really, is that what you really said! A credit card charge is nothing more than a deferred debit card transaction, I make my credit card behave like a debit card each month, because I always pay down my balance. But I don't have to, I can spread my payments over time, if I chose. According to your logic, I have the ability to determine what is assessable income and what is not, just by deciding whether to pay off my credit card bill, or not. Mike says, do not pass Go, do not collect $200! I take the view that a personal balance sheet comprises assets, liabilities and credit lines that have been granted, especially where that credit line has been drawn down. We don't agree, it wouldn't be the first time, let's not belabour the point.

This is a very important distinction in these debates that everyone should pay attention to. The issue with all these things is whether something is allowable or not. not what the chances are of getting caught when using something that is not allowable or borderline. The former discussion is OK, the latter is very much not OK.

You chaps across the pond have some funny ideas on such things, you think that having an intermediary make a payment for you, absolves you of any connection with that payment..........it wasn't me guv, he paid for it, not me (whistles in the air and walks away). Frank Wilson would not be impressed. 🙂

I have no idea on this, if I had to guess I'd probably say no since the school fees are necessary expense that would have to be paid anyway. If the child was yours who lives with you, I'd say no. If the child was unrelated and lived elsewhere, it stands a better chance. Gifting your own child school fees is like gifting them living and accomodation expense when they live with you. Bottom line, I don't know.

Come on now!!! This is not the Dark Ages, people use bank accounts, debit cards, phone apps and wire transfers.

UK non-doms overseas credit card usage in UK, HMRC https://community.hmrc.gov.uk/customerforums/sa/86d51480-349f-ee11-a81c-000d3a0d1e21 Condo's??? If somebody remits funs to Thailand to pay for a condo, the money is either assessible or it's not. If it is, the remittance itself is the taxable event...or are you saying/asking something completely different?

I suppose that there's always a chance that Thailand doesn't regard that as Tax Evasion, unlike every other country in the world so yes, I suppose you are right, it's merely my opinion. Perhaps they say, go ahead and Gift whatever you want to somebody else and later, when we 're not watching, they can give it back to you. That way you want have to pay us tax and we wont say anything....cool.

Will you put that in writing, sign it and indemnify us all?

Up to you what you believe, gift away with impunity I say, if you don't care! For everyone else, it's tax evasion.

We've been through all this weeks if not months ago, is the way life is going to be every few weeks/months.......oh, I didn't remember that, can you provide a linkl!! What was pretty much agreed previously on this was that when the CC holder acquired the goods or services abroad, that contract for payment represented the taxable event. It doesn't matter that it was done on credit, once the buyer agreed to buy and the seller agreed to sell, at the agreed price, the contract was formed. UK HMRC credit card debt in the UK using overseas cards, equals remitted funds...google it.

Jolly good. "For tax planning purposes, it’s crucial to understand that you must not derive any benefit when gifting assets. For example, if an expat sends money from overseas to their Thai spouse and it covers their living expenses, it is not considered a gift. Attempting to bypass the tax regulations in this way is likely to be considered tax evasion, potentially resulting in severe penalties". https://www.expattaxthailand.com/gift-tax-2024/

I'm sure that's the case. But we're talking in this example of a married couple who maintain a certain spending pattern and lifestyle, then suddenly, he gifts her 1 mill and his bank account spending pattern changes to almost zilch, even worse is that change takes place just as new tax regs are introduced. That can be seen.