JimGant

The reason the gift tax came about at the time the inheritance tax did, was to have fat cats realize a penalty if they tried to give away enough of their estate to slide below the 100M threshold for the inheritance tax. So, yeah, the govt gets to collect some of those taxes lost by the fat cat's estate dipping below 100M due to gifting. But the fat cat doesn't really pay a financial penalty, since the gift recipient is paying the tax (if any) -- and the govt doesn't really care who pays it, so long as the future loss of inheritance tax is mitigated, to some extent, by the gift tax. Having said that, do you think the govt is going to allow the fat cat to exempt from taxation all those funds going as gifts? Not only would this widen the gap between lost inheritance taxes and collected gift taxes -- but it would reward the fat cat by possibly pushing him down to a lower tax bracket (well, maybe not, as he's probably well above the 35% marginal tax rate). In any event, the govt is not going to reward, via tax exemption, someone gifting away his estate in order not to have his estate eventually pay inheritance taxes.

I can't seem to find the 'remitted income' exception anywhere in that pub. A little help, please. Thanx.

Got a source for that?

Why? What if it's not income, or if it is income, that it's exempt income via DTA, or exempt because it's pre 2024 income? Or it's loan money you wired from home, to buy that condo. This money is nothing the RD needs to know about. Just keep good records, and hope you're not inconvenienced by a very low probability audit.

You can call it a fried banana, as far as taxation implications go. You remit income into Thailand -- it's purpose (as we've scrutinized to absurdity) is not important. You report your assessable income remittances on your tax return -- where nowhere is the purpose of the remittance recorded, thus nowhere to get a tax exemption for a gift purpose. If the landlord you remitted your rental fee to wants to call it a gift, or if you want to call it a gift, makes no never mind to the bottom line of your tax bill. However, the only tax implication is whether or not the landlord calls it a gift, and not actually the income it really is -- and (mis) files his tax return accordingly.

Huh? I send remittances of assessable income to my gf; my landlord; the soi dog hospice 😉; my housekeeper; blah blah. Never ever send on nickel to my bank account in Thailand. They're still remittances, all of which I have to determine, for tax purposes, as to whether or not they're assessable income. Matters not that they never passed through any financial account of mine in Thailand.

No, it's not the son's income. And the father is not a Thai tax resident -- so it matters not what the nature of the funds being sent to the son consist of (after tax, before tax, savings -- Dad has to sort any tax implication out with his resident country.) Thus, if the son receives a chunk of money from Dad, no strings attached, it would be considered a gift. Which leads to the question: The son received a gift from Dad, say in excess of 20M baht -- is he now subject to the Thai gift tax for the excess over 20M? Nope. Say Dad is a resident of the US. The DTA covers such a situation, whereby double taxation on gifts and estate taxes is avoided. Thus, Dad will be subject to a gift tax on that gift to sonny boy. And sonny boy won't need to file a tax return with Thailand for the excess gift over 20M.

TRD hasn't the foggiest interest in the purposes of the remittances -- because the purpose of the remittance in no way affects the assessability nor taxability of the remittance. It's up to you to self assess the nature, thus the potential taxability, of the remittance. For a Yank, govt pension, social security, VA disability payments, for example, are not assessable income -- and wouldn't be noted anywhere on a tax return. But a pension check from Boeing would. But other cash flows into Thailand need not be noted as assessable, like loans you're bringing over to buy a condo; an inheritance from Uncle Joe; and a gift from Aunt Martha (in this case, the only gift reporting onus is on Aunt Martha, who reports it to the IRS, if above a certain amount). Thus, there's nothing on your Thai tax return that reflects, or is affected by, the fact that the final destination of this remittance is as someone's gift. Now, the burden of any gift tax will now lie on that recipient -- not you. Sorry, then -- no tax exemption on remittances of assessable income destined as gifts. Even to a monastery -- yes, charitable deductions are available -- but only on after-tax (disposable) income, not on incoming remittances.

But why wouldn't it be relevant to a gift tax -- are you inferring importations destined as gifts are somehow unique compared to the purposes of other importations? Anyway, we seem to be on a treadmill here. Maybe we should just agree to disagree.

No, not unique, as in: gifts, like money sent for expenditures, to buy a new car, to buy a condo, whatever -- are NOT UNIQUE. Thus, the purpose of imported foreign income has no bearing on its taxability, just as you said in your quote: "The Thai Revenue Code does not consider the purpose of the funds that are imported, only whether the funds are assessable or not." Ergo, money imported, whose final purpose is a gift, is NOT UNIQUE from other importations, and thus is not tax exempt if otherwise assessable.

Au contraire: "The Thai Revenue Code does not consider the purpose of the funds that are imported, only whether the funds are assessable or not." What could be more encompassing of whether or not funds destined as a gift are taxable -- than the Thai Revenue Code stating that the purpose of the funds has no impact on their assessability and potential taxability. Sarcastic, how? That really has me scratching my head.

You need to include your post, upon which I was commenting on: Then, my observation: I'll leave it up to the reader to determine whether or not you agreed with my assumption that gifts are not unique in that their end use exempts them from being assessable foreign remitted income. Now, if that is not what you meant, well then, I'll give you a chance to give your reasoning as to why they might be exempt from being assessable income. To include the whole rationale behind Thai gift taxes, which like the US, are a means to penalize gifting away your whole taxable estate to avoid inheritance taxes. Which, for Thailand, has majority relevance to domestic gifting, not gifting from abroad -- and where providing a tax break for the gifter doesn't seem very relevant to anything, 'lest there actually is a law, with the implied corruption behind it, to exempt remitted income identified as having an end result as a gift. If that's what you believe, then, yes, maybe remitted foreign income slated to be a gift is exempt from being assessable and taxable. And, I guess, we'll have to leave it at that, until we identify such a law. Cheers

Does this mean we'll not enjoy your sage wisdom at our annual black tie get-togethers? Don't know whether to cry or puke....

Yes, everything over 20M will be subject to a 5% tax -- and yes, the first 20M of gift would be exempt from taxation. And, yes, it's up to the recipient of the gift to file the tax return -- not the gifter. Certainly you're not saying there's another tax angle, namely: The gifter gets a tax holiday on 20M, otherwise taxable, because it is a gift -- and not an investment or expenditure...? If you are saying this, please give me your source. Thanx.

Again, this is a legitimate gift -- and you're alluding that that makes it non assessable income? Where in the tax code do you get that assumption from?

Give it a rest. Giving practical advice, that won't bite you in the a**, vs quoting what the (nonsensical) law actually says -- is probably what's best-serving on this forum on taxes. Sure, state what the laws are -- then advise how to maneuver around them, if practical. Otherwise this forum, and thread, might as well just quote Thai tax code. Sorry, my former job was helping clients navigate potential taxation gray areas, without any non ethical deviations. ***Flame and comment on moderation removed

For tax purposes, he effectively did.

Relax. Even with assessable income, if after all deductions and allowances, you have no taxable income -- then no TIN needed, no taxes due, and no real need to file a tax return, as they're not going to waste resources coming after you for a 2000 fine for not filing a nil tax return.

If Mr U had assessable income -- had it been remitted to Thailand -- then it would be subject to Thai taxation, regardless of its final destination or purpose. But, yeah, if Mr T had a US bank account, to which Mr U transferred a gift into -- then Mr T's subsequent remittance of this gift to Thailand would be non assessable. Same as if I remitted an inheritance from Uncle Bob, or a loan from Aunt Agnus -- these monies are ALL NOT INCOME -- and, of course, therefore non assessable for Thai tax purposes.

Ok. But say it was a legitimate gift -- no strings attached to the recipient. Does this now make it tax exempt? Say you, the sender, is called into RD for a chat about your remittances. And you're a Yank. Your spreadsheet shows a military pension remittance; social security remittance; and a remittance from a pre 2024 savings account. All, per DTA and recent ruling, are non assessable income, to do with as you please, including gifting, loaning, and spending. Now, the last entry on your spreadsheet is a private pension remittance -- which, per DTA, is the exclusive taxation right of Thailand. But you have an asterisk next to it, stating: This is now non assessable income, because I gifted it to my neighbor somchai. What ruling would you show the RD clerk that makes it so? I certainly can't find any such animal.

Let's get our eyes back on the ball -- tho' it appears they never were on the ball.... First of all, the Thai gift tax has nothing to do with the source of the gift -- or whether or not it's a domestic transfer or an international transfer. Thai 'income tax on a gift' is just a tax on gift amounts over 10M (using as an example a friend as the recipient), which the recipient has to self-assess and is responsible for filing the related tax return. The sender can just be using the friend as an intermediary for receiving his (the sender's) money. Thus, no gift implied, no gift tax due (and in all cases, no tax question for the sender to ponder). The sender just shows up and collects from his friend, if being used as an intermediary. Again, the money could have been a domestic or international transfer. In both cases, there's a separate, completely unrelated question -- was that money subject to income tax (and, if so, have such taxes been paid). Or, for international transfers, were those transfers assessable for Thai tax purposes -- a question completely divorced for what those funds are later used for, be that a gift, a loan, daily expenditures, whatever. Yes, when I send a Wise of SWIFT transfer, they ask the purpose. But if I say "gift," this has no significance for anyone in Thailand -- it's to let the US IRS know that I might be subject to a US gift tax. So, again, there is no Thai tax angle on gifts for the sender -- only the recipient might have some tax obligation. The determination of assessable income is completely unrelated to the eventual use of that income.

The taxation character of a home country's pension remains when subject to a resident country's taxation -- at least in this example from the tech explanation of the UK-US DTA: This is a 'read between the lines' explanation, as you won't see anything so definitive in the actual treaty. And, since these technical explanations seem to be US generated, probably no such animal for an OZ-Thai tax treaty. But, recent OECD studies to modify their Model tax treaty examples, have introduced just such language as seen in this technical explanation. And this can be found on-line with a little research. Thus, you could have a notebook of why international flavor supports no taxation of Oz tax exempt pensions in Thailand. And Thailand is petitioning to become a OECD member -- doubtful, then, they'd piss on any OECD sanctioned argument. Bottom line: Don't declare your remitted Oz tax exempt pension as assessable income. Always give yourself the benefit of the doubt in gray area tax situations. Thus, in the unlikely event you're ever called in for a chat, your notebook will give your position credence. You might still be taxed -- but certainly no malfeasance to attach a penalty or fine to. Definitely worth the risk. Ask a Chartered Accountant, the Oz version of a US CPA. They'll know what I'm talking about.

Bottom line? I couldn't quite understand the thick accents.

Yes, but again it is the recipient, not the giver, who's on the hook for taxation above a certain amount of gift: Or ten million baht, for GF's. Nothing in this about how, why, or when taxation takes place for the amount gifted. Meaning, amounts of assessable income remitted to Thailand for the initial, or subsequent, purpose of being gifted -- are treated without consideration of their final gift purpose.

You're right. Good catch.