JimGant

On 5/20/2024 at 4:07 AM, Mike Lister said:

That French video has caused more problems than it has solved.

Yeah, the Maginot Line wasn't very helpful either....

On 5/19/2024 at 4:37 PM, Middle Aged Grouch said:

Will banks start to deduct tax at source on every foreigners bank account even if the foreigner does not stay more then 180 days ?

Only on interest earned in the bank account. Are you asking it they'll deduct taxes on all wired money into their bank? Use your noodle -- how would they determine what part of that wired money is income, or not?

22 minutes ago, Mike Lister said:

They want to know if the remittance represents assessable income, or a Gift that will negate the assessability of that income.

There's no free lunch for grif..., er, gifters.

2 hours ago, Mike Teavee said:

What's the point in having Gifts at all then as by the logic being proposed here If I were to Gift my wife 30Million out of untaxed funds from the UK, I'd have to pay the tax on the whole 30Million & then she'd have to pay Gift Tax on 10Million... Isn't that a classic example of double taxation?

Nope. Two kinds of taxation -- income and gift. If I give my nephew $20000 out of my after tax savings, I'm nailed for a gift tax on $1000 (other countries, the recipient would be nailed for the gift tax). Certainly not double taxation in the classical sense. I'm afraid some of the confusion on this thread is not differentiating between income and gift taxes. And it certainly doesn't help that Thai RD refers to gift taxes as "PIT."

2 hours ago, Mike Teavee said:

if she did give monetary gifts to her staff then why if she was still liable to pay tax on the money?  

Because it became income, not a gift. Why she, not the workers, had to pay the tax -- dunno. This whole drill was a sham.

2 hours ago, Mike Lister said:

If a Gift to a charity, you get to write that off as a deduction

Right. But only after you declare that assessable income on your tax return -- so (I don't know what charitable deduction rates are) it's probable the deduction won't completely zero out the tax on your remitted assessable income.

3 hours ago, topt said:

Sorry if this has been posted already but you have any official link for that? 

Nope. Not sure there are any official links mentioned on this, and similar, threads.

12 minutes ago, Lorry said:

I gift 200MB to my Thai wife in Bangkok.  She is the receiver and has to pay gift tax on the 200MB. But it's only 5%, and the first 20m are completely exempt from gift tax. So, she only has to pay 5% x 180m = 9m.

This is a very good deal for her, because if she would have to pay regular income tax on the 200m, her tax burden would be almost 35% x 200m = 70m.

Why define the nature of the 200MB? The gift tax journey is about having Thai fat cats having to pay (or have their recipients pay) a tax for bygone future estate inheritance tax receipts on assets that may have been given away as gifts. Don't define it as a gift, but as a loan, due in 30 years (or some ridiculous term, known only to you, not the tax folks). Bottom line: No gift tax, since no gift.

And why would she have to pay income tax on the 200M -- no earnings indicated here.

37 minutes ago, Mike Teavee said:

she had to pay tax on the gift regardless of when it was given then she would still have been guilty. 

She had to pay tax on the "bogus" gift amounts given to her cooks, gardeners, drivers, etc, from whom the proceeds were redeposited into her bank account. Pretty sloppy job of disguising gifts.

30 minutes ago, Mike Lister said:

Once that income is remitted direct to Nookie's account in Thailand, it becomes assessable income that he must report on his Thai tax return. Nookie however doesn't have to report anything because the amount is under the Gift Tax threshold.

Of course. Once that money crossed the border, it makes no never mind where it ended up. It is now remitted, assessable income (assuming it's assessable per the DTA). Nookie can call that cash input anything she wants, best just not call it anything. If she called it income for some kind of services provided, then she'd be subject to having to file a Thai tax return. Calling it a gift -- then, yeah, the 20M cutoff for gift tax. Or if the gifter said, "Pay me back in 30 years," then it's now a loan, not a gift. Anyway, Nookie just remain quiet. Cyril, pay the man for that remittance -- again, final destination of remittance completely irrevelant to income tax situation.

2 hours ago, KhunHeineken said:

This a quote from Dogmatix:

There is nothing in the thus amended Revenue Code, as some ignorant, English monoglot commentators have suggested, that delineates how spouses may utilize these love gifts or anything, as some have even more ludicrously surmised, saying that gifts may only be made from income already subjected to Thai PIT.

Yes, gifts may only be made from income already subjected to Thai PIT, or per DTA, income subjected to home country taxation.

1 hour ago, Mike Teavee said:

Ahh, so  we're debating whether a Thai Tax Resident sending his wife a Gift from his overseas account would be liable for Tax on the Gift even if it doesn't come into his account? 

 

IMHO the answer is NO as you are not remitting any money for yourself & (in the case of a genuine gift) will receive no benefits from that Gift 

Remitted assessable income is subject to Thai taxation -- regardless of where this money eventually ends up.

10 minutes ago, Mike Teavee said:

Why would he be over the moon? He's 20 Million out of pocket & got zero benefit from it beyond the warm feeling of giving somebody a Gift

He's over the moon because whatever he gave as a gift is (he believes) exempt from Thai income taxes. If that 20M leaves a hole in his budget, he can discuss remedies with the gift recipient. Meanwhile, he can enjoy maybe a 35% windfall on taxes.

42 minutes ago, Mike Teavee said:

(i.e. the 20Million / 10Million thresholds) but all of the links are very clear that genuine Gifts up to these limits are not subject to Personal Income Tax... 

Not subject to a GIFT TAX. Yes, the guidance uses personal income tax in lieu of gift tax -- that makes matters all that more confusing. Gifts are NOT subject to income tax, period. Only the money that became a gift is subject to income tax.

39 minutes ago, Mike Lister said:

Do you agree that the Gift Tax rules, benefit the receiver of the gift rather than the gifter?

Well, if the gifter gets to exempt the full amount of the gift from Thai  income taxes, then, obviously, he benefits the most. But, I don't believe this is where Thai tax authorities are. And the receiver certainly has an out-of-the-blue windfall, 'tho she (assuming wife/mother) has to pay a 5% gift tax on amounts greater than 20M baht. Thus, the gifter may have a tax holiday in two ways -- income and gift taxes. So, I'd say he's the winner.

51 minutes ago, Mike Lister said:

Do you agree that the benefit to the receiver is a zero rated or reduced rate of tax on income?

The gift is not income, so income tax doesn't come into play (not to be confused with gift tax). But, yes, as a gift the first 20M is exempt from a gift tax; and the whole total amount, as long as a legitimate gift, is exempt from income taxes. So, yeah, good deal for the receiver. But, the receiver DOES have to pay the tax on the 20M excess, not the gifter. (Unlike in the US, where the gifter pays the tax, not the recipient.)

1 hour ago, Mike Lister said:

Do you believe there is a benefit to be derived from gifting the funds?

The recipient of the gift is certainly pleased. Now the gifter -- if he believes whatever amount of previously assessable/taxable income is now tax exempt -- he's, of course, now over the moon. And, if he can believe all the supporting blah blah on this forum, come next March2025, when he files his taxes, can just omit as assessable income that chunk of money he remitted in 2024 that ended up as a gift. [Mike, don't cut that, as it's just an observation, not an illegal endorsement.]

10 minutes ago, Mike Lister said:

Except where invoking a DTA would mean the right to tax, shifts from the UK to Thailand, which means the obligation to tax shifts also.

In either situation, the income that eventually ends up as a gift -- is taxed as income somewhere. You seem to be confusing income taxation of pre gift income with a gift tax, on a sum of after-income tax money subsequently gifted. I think when you said "the UK doesn't tax gifts from overseas." you meant: It didn't apply a gift tax to sums of money gifted from overseas. Totally separate from from any income taxation on this same pot of money.

2 hours ago, Yumthai said:

One field of thought is that Gift Tax cannot be used to escape Thai tax by Gifting untaxed money from overseas. On the other hand, many Western countries, including the UK, do not tax gifts from overseas

The UK doesn't tax gifts from overseas -- because the obligation for income taxing the sum of money gifted is on the source country. The UK, like the US and all other OECD countries, assumes the gift is an after-income tax asset. And there's nothing out there, at least that I can find, that implies Thailand is unique in treating gifts as being exempt from income tax, whether due in the source country, or due in Thailand when remitted, prior to its becoming a gift.

Can anyone recall where this notion that income remitted to Thailand, that is assessable income -- is somehow tax exempt if its final use is as a gift? I think that somehow wishful thinking blossomed into presumed fact....

26 minutes ago, Mike Lister said:

it's not about will they monitor this or that it's not about the various workarounds, discussions about those will not be held here!

Why not? A discussion of possible workarounds is certainly germane to this subject. Yes, if the workaround would definitely be illegal -- then, yes, disallow. Possibly illegal? Allow discussion, with caveat of potential illegality. I guess the one workaround you will allow is: Leave the country.

4 hours ago, Mike Lister said:

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.

A gift tax is what's paid on gifts in excess of 20k to family, 10k to non family. What we're dancing around here is, whether or not a gift makes an otherwise remittance of assessable income -- no longer assessable, and thus now tax free. Sound too good to be true? You bet.

That's why I think the following from the Personal Income Tax guide still applies:

Quote

30) In a second example, funds that you remit to another person, from overseas, might be intended as a Gift, but for your own tax declaration, this intention does not matter. If the funds you remitted to another person are from your assessable income as listed in TRD 161/2566 you have to declare them and you will  have to pay personal income tax on them.

22 minutes ago, KhunHeineken said:

If it's a debit card, it's not a loan. 

Correct. But he asked about sticking a credit card into the ATM machine. So it would be a loan, using a CC for a cash advance.

2 hours ago, steve187 said:

would that be the same as cash taken from an ATM in Thailand using overseas credit card

Sure. That would be a "cash advance," which is a fancy term for a loan. And since a loan is not income, such monies when remitted to Thailand, either by a SWIFT wire or by an ATM machine -- are not subject to Thai taxation.

17 minutes ago, Mike Lister said:

A credit card is a debit card with an extended payment option, no more no less.

Yeah, that extended payment option is called a loan. And there's no need to further discuss why remitted loans to Thailand are NOT assessable income.

1 hour ago, Mike Teavee said:

We’ll agree to disagree, certainly the UK treats CC payments as remitted income but obviously that doesn’t necessarily mean Thailand will 

Only in the odd ball situation of a "non domiciled UK resident," who "opts"to be taxed on his remittances. The other 95% of Brits are not taxed on their remittances, and thus credit card charges are loans, not remitted payments. Where Thailand might head is a good question. But wherever that is, no foreigner is going to declare credit card charges, or even debit card charges, as remitted, assessable income. Thailand's cost/benefit analysis will certainly show it ain't worth it to pursue such charges as assessable income. Even Forest Gump would come to this conclusion.

1 hour ago, Mike Teavee said:

but the discussion was around whether Foreign Credit Cards used in Thailand is remitting money or not

not

10 minutes ago, Mike Lister said:

you think that having an intermediary make a payment for you, absolves you of any connection with that payment...

Mike, you've lost your compass. Yes, a bank making a foreign payment of your debit card charge has the appearance of a remitted income, as the account is instantly reduced by the amount of the charge (I say appearance, because your bank account may be full of savings, not income). But a credit charge does not reduce your bank account balance by the amount of the charge (duh), because, of course, it's a loan -- paid back in full 30 days later, or 2 years later, if you make minimum payments and pay interest. There's is no remitted cash flow from your bank account, that can be construed as remitted income.

The payment for your hamburger is the banks money, not yours.

Yes, the UK has a remittance income system, somewhat bizarre, where a non resident is considered a resident (kind of a transgender-like tax situation), where they've then transformed credit card charges into debit-like charges, meaning, we'll treat your money as being remitted, not the bank's.

That Thailand will follow this system, will remain to be seen (actually, they could have followed it the last 30 years, as this would have been a prima facie case of same year income, being remitted same year, thus taxable. But, good sense -- and history -- says, RD will never look at credit card charges as other than what they are -- loans. Just like a loan for condo remitted to Thailand.