JimGant

Yes, ignoring laws that have no practical value is what most efficient organizations do. That I might be called in for a chat, 'cause I tripped some wire when I bought high priced air conditioners at Home Pro, with my credit card -- and credit card purchases are deemed assessable income by Siam Legal -- give me a break. TRD isn't stupid enough to waste resources to query Home Pro about large credit card purchases by farangs, and then have to research whether or not those farangs were tax residents -- with the highly probable result that non assessable cash paid the credit card bill. TRD certainly can do cost/benefit analyses -- and the above scenario certainly wouldn't be a keeper. No, I'll certainly risk a 2000 baht fine for not filing 'cause I have 120k in assessable income -- knowing full well the chances of an audit are slight. And, with no tax evasion, nothing serious could happen, even if an audit occurred. Yeah, the same law firm that tells you you have assessable income using your foreign credit card in Thailand. That you're comfortable with their overall advice -- is ludicrous.

He's a charlatan. When you have time, grab a beer, kick back, and read this thread. https://aseannow.com/topic/1008555-tax-specialist-in-chiang-mai/

Which was exactly my point, to go after the Siam Legal beagles that just flatly said, "credit card purchases are a taxable event" Period. Without consideration of payment source. Anyway, I guess we're on the same frequency.

Not sure of your point.......if the credit card you use for purchases in Thailand is paid off with non assessable income/funds, then there is no taxable event. Plain and simple. What am I missing?

Ludicrous. Even if the credit card purchase I make in Thailand is not considered a loan, but a marker to be paid back from my checking account -- who's to say that money in my checking account is income, or even assessable income for Thai tax purposes? In my case, all the money in my checking account is from direct deposits from my govt pension and from social security. And this money is non assessable by Thailand, per DTA. Thus, when my bank direct debits my checking account, to pay back the loan -- it's tapping non assessable income. And this would be even more obvious, should I use a debit card, whereby the payment to Thailand is a near instant suck from my checking account. So, unless Thailand is treating all foreign remittances as assessable income -- even in the guise of a credit card purchase -- then you can't say all remittance scenarios are taxable events. And, it's unimaginable that Thailand is treating all remittances as assessable income, nor do they have the resources to parse all remittances for assessability (they would need a data base incorporating language from 61 DTAs). So, another situation where self-assessment is a necessity. Thus, Siam Legal seems to have a few holes in their thought process. Not sure I'd want to rely on any of their guidance.....

Ah, now I understand our disconnect. You're only remitting part of your rental income. And as such, you can call that remittance from either a gross or net figure -- and, of course, gross allows you to take the 30% deduction. I'd been assuming you were remitting all your rental proceeds. And since remittances are a cash flow situation -- and since cash expenses reduce you cash rental income -- then that rental remittance cash flow to Thailand -- would be net rental income. We were on different frequencies. But, when we go to worldwide income, this cash flow peculiarity will disappear -- and what will be subject to Thai taxation will be net rentals, i.e., using the US example -- the rental figure included in the "gross income" line on your 1040 (yes, a confusing contradiction of terms -- no one ever called the IRS bright). I guess a discussion for another day.

Actually, as you've subtracted out your only expense on that rental income, what you've remitted is your net rental income -- and you'd be on the wrong side of integrity if you subtracted out a further 30% deduction for expenses. So, no, you haven't remitted gross rental income. But, what many of us have said here -- what is remitted to Thailand is what is considered "gross taxable income" [gross, because it hasn't been reduced by standard deduction]. And taxable income is revenue minus expenses. And this is how you have to characterize cash flow remitted to Thailand -- it is an amount, not net of taxes, that both countries can use a baseline for their taxation purposes. Then, you have no reason to participate in a thread affecting expats. Jeez, it's your UK-Thai DTA that says Thailand has a secondary taxation right in your rental income. So how can you say you have no interest -- when what we're talking about is completely affected by the DTA?

Oh, ****, why do you go off on these stupid tangents. You've already said that you don't give tax advice, which is good, since you're not qualified. anr's observations are right on the money, at least as they apply to Yanks -- so it IS of interest to the American expat community in Thailand. First and foremost, Thailand is interested in remitted income, after it's been thrashed through the wringer, and comes out on a home country tax return as "gross income." For US rental income, it first goes through Schedule E wringing, where expenses are deducted from rental proceeds, and the resulting figure is put on line 5, "additional income," on Schedule 1. This figure is included in the final Schedule 1 figure, that is put on the front of Form 1040, and shows up in line 11 as "adjusted gross income." Thus, the net figure on your Schedule E, becomes a finalized gross figure on your Form 1040 -- and this is the amount you self-assess on your Thai tax return. Why declare your US rental income on a Thai tax return? Well, the DTA gives primary taxation rights for this income to the US. But it also gives secondary taxation rights to Thailand. So, to be correct, you're supposed to declare this rental income on a Thai tax return. However, Thailand has to give you a credit for the taxes paid to the US for this income. Thus, on the back of an envelope, you could determine whether or not this rental income, after subtracting the tax credit, even brings you into being a Thai taxable income situation. If not, and there are no other taxable income scenarios -- don't file -- if you have something more important to do, like a tee time.

Actually, if you're a Yank, you can still not be stupid by filing a Thai tax return to get back your withheld tax on interest -- and just take a tax credit on your US tax return for those Thai withheld taxes. No proof of Thai taxes withheld is needed with your US filing -- and if those taxes are below 20,000baht ($600), filing jointly ($300, single) -- only a single line item entry is required. For higher amounts, a Form 1116 is required -- but it's an easy fill. All this plugs easily into your TurboTax actions. The only requirement is that you're unable to get a refund from the Thai govt. But to get a refund, you need a TIN. And as we know from this forum, there are plenty of examples of folks being denied TINs for not having a work permit, etc. Good enough excuse for an IRS audit. Thus, one more reason not to get a TIN -- and to avoid all contact with the TRD.

Someone already explained that your "government pension" was actually a social service payment of some kind, not a pension for services rendered to German government. This would be akin to the UK, where their State Pension is not for services rendered to the govt -- and is taxable by Thailand. But a UK pension paid for service to the govt is solely taxable in the UK -- same for a German pension paid for your work for the govt.

....and your tax position, as shown by your filled-in null tax return, is that you don't owe any taxes. What could be easier to understand? Duh. But you're not, I hope, suggesting you unload all your remitted income data to the agent, and have her determine which is, and which isn't, assessable income -- which, of course, would involve her knowing your DTA's particulars -- which would be a ludicrous position to take. Seems to me some guy named **** actually did offload all his income data to TRD, to have them decipher which was, and wasn't, assessable income. I remember this distinctly because of its nonsense value.

Well, I guess there are two of you out there that filed a null tax return five years ago -- and were queried by the clerk as to why you were filing if you didn't owe taxes....

She thought you were crazy?

Taking the advice of a TRD official to do nothing -- sounds like official advice to me.... Come on, ****. You've been beating this subject to death for over a year now. I guess you're the kind of guy who always drives the speed limit in the fast lane -- driving the more realistic folks nuts.

OK. And Stat's talking about the equivalent of US Social Security.

Why do you say that? The DTA says German govt pensions are exempt from Thai taxation.

You're right. So, unless I have Thai taxable income, I won't file. However, you and your crowd, with 120k in assessable income, should plan to get a TIN, and to file, 'lest you worry over this. Nevermind the absurdity that you'd need another 440k in assessable income to even have any taxable income.

Is that because you'd now be paying more in total taxes between your home country and Thailand, if you were a Thai tax resident?

Of course. Just common sense. As a non filer, you'll never be on the TRD radar screen anyway. Sure, they can guess that you receive remittances to live on. But they certainly can't parse those remittances for assessability, as even they understand cost/benefit analyses. No, the chance of ever being called in for a chat about why you didn't file a tax return would seem to be zero. And if you were, what big deal would occur? This was heavily discussed months ago, and I was banned for a week for giving advice to break the law. The cause of that banning no longer participates here.

oldcpu -- not sure where you got your English translation of the German Thai DTA? Here are two sources I Googled: https://www.rd.go.th/fileadmin/download/nation/germany_e_221057.pdf https://www.expattaxthailand.com/wp-content/uploads/2024/03/Germany-Thailand-Double-Tax-Treaty.pdf And here's what these sources say: What I make of your translation is that it refers entirely to private pensions -- and may be taxed in Germany only if, as a German pension, the payment of that pension is subtracted from the income sheet as a cost against profits (the ordinary situation, I presume). Your translation goes further than mine, where it adds a paragraph 2 delineating that a German resident of Thailand, receiving a Thai pension, has that pension only taxable by Thailand. My paragraph 2 covers government pensions, and is pretty clear in its statement that govt pensions are taxable exclusively in the country paying the pensions. And both our sources are saying the same thing re private pensions, although it's a little weird that it gives the country where the private enterprise is located -- taxation rights only if that company treats its pensions as a cost (what enterprise doesn't?). Anyway, OECD treaty language uses the language "may be taxed by country A" to mean country A has primary taxation rights -- but country B has secondary taxation rights. So, in this example, if you're a German tax resident of Thailand, receiving a German private pension (which is a cost to the company -- then Germany has primary taxation rights. Thailand, however, can, if it chooses, also tax that pension -- but has to absorb a tax credit for the taxes paid Germany. Of course, if Germany doesn't tax that pension -- and Thailand does -- Thailand has no credit to absorb, and thus gets to keep the whole bundle. But, if you're a German expat in Thailand -- I'd probably seek some further clarification.

Are you sure? The following is from the English translation of the German-Thai tax treaty, Article 18:

Don't forget it's only assessable income we're concerned with. All those govt pensions, social security, pre 2024 income, and for some (Canadians), even private pensions -- are probably most, if not all, the income remitted to Thailand. Thus, assessable income well below 560k.

We seem to be on a semantics circle jerk.... Let me show this quote again: So, if you live more than 180 days per calendar year in Thailand -- and have a UK private pension that you remit to Thailand during this year -- then per the tie breaker rules in the UK-Thai DTA -- Thailand is your country of residency for the purpose of the DTA. Thus, you pay taxes on the private pension to Thailand. And per DTA, NO tax is payable to the UK. Double taxation is avoided. Unfortunately, the UK-Thai DTA is silent on private pensions. But OECD and UN Model tax treaty language holds that income not described in any DTA article is exclusively taxable in country of residency (as determined by the DTA).

This is about taxable income, which is assessable income after Thai deductions, allowances, free 150k are deducted. Nothing left, no taxable income. Certainly this is not about "total assessable income," which is meaningless, if there's no taxable income after the deductions. Assessable income, for Thai taxation purposes, will be all that income the DTA says is taxable by Thailand. This could be, for example, private pensions, which Thailand has primary taxation rights on -- or rental income from US property, which Thailand has secondary taxation rights on. Or it's not assessable income, like US govt pensions. IRS deductions and allowances play NO role in the Thai taxation equation -- only the deductions and allowances in their tax rules. It's only when certain deductions and allowances, like the US good-deal for long term cap gains, which Thailand doesn't copy, that you find the disparity will hurt the Yank taxpayer. For the simplistic tax return that I highlighted for my situation, the Yank will not be hurt by these new Thai tax rules.

Nope. Here's what my taxes would look like if Thailand went to the worldwide system -- actually, it wouldn't be any different than if they stuck with the remittance system. What I'm looking at here is what income would be taxable by both the US, and by Thailand -- per the DTA: My Air Force pension, and Social Security would be exempt from Thai taxes. But my Required Minimum Distribution (RMD) from my IRA would now be primarily taxable by Thailand -- and secondarily taxable (because of the treaty's saving clause) by the US. My Standard Deduction with the US would be, for single, age over 65, $16,200 (TY 2024). For Thailand, my so-called TEDA (Standard Deduction equivalent), comprising for a single over age 65, with a pension payment, and including the 150k freebie: 500,000 baht ($15,200, at latest FX rate - 32.8) Ok. Now my RMD is all into the US tax bracket of 22% ('cause the govt pension and SS get me there). So, my average RMD for the last few years -- of $20,000 -- would be well into taxable income territory -- and at 22%, would cost me $4,400 in US taxes. Now, this RMD of $20,000 is the equivalent of 656,000 baht (again, FX of 32.8). And to get into Thai taxable income territory, I need to exceed their equivalent of Standard Deduction, which as we outlined, was the 500,000 TEDA. And we do get into taxable income territory. Thus, my taxable Thai income is: 156,000 baht. Which amounts to 8,100 baht in taxes, or $247 -- which is $4,153 less than what I pay the US on this same RMD -- which, of course, can be subtracted from my US taxes, as a credit, leaving me with the same tax bill I would have, if I only paid US taxes, and not Thai taxes. Hmmmm. Maybe it's not time to relocate.... And what if my US taxable RMD, plus maybe some interest income from both the US and Thai banks -- equaled $40,000? Again, I'm still in the 22% US tax bracket (for a tax bill of $8,800); but have now crept into the Thai 20% tax bracket. However, most taxation occurs at lower bracket rates, so my effective Thai tax rate is 13%, or 107,400 baht, or $3,274. Again, much less than the US -- and completely available as a tax credit against US taxation. Hey, I'm not sure of how much of an average Yank I am -- I have about 30% of my securities in mutual funds, held by my standard IRA. So, all my cap gains are taxable as ordinary income, both in the US and in Thailand. But for Yanks heavily involved in individual stocks, and thus get a great tax advantage on US taxes for long term cap gains -- and qualified dividends -- well, then, they'll take a hit, as Thailand won't reciprocate those nice US tax breaks. So, yeah, maybe a few Yanks looking to vacate. But, I surmise my example is more the norm for Yanks -- and I won't be losing some American pals.