JimGant

The DTA already says the type of money I'm remitting is not taxable. And, where on a Thai tax return would I put my Air Force and Social Security income, and designate it as "exempt per treaty?" No, declaring to Thai RD my "non assessable income" just opens up more areas for confusion. A poster here has been declaring his non assessable income on his return for years, and has gotten nods, "yes, no taxable income -- thank you very much white man (snickers in the background)."

Yeah, but the operative word is "income." And how will they know what part of my remittance is income, and which part is an inheritance from my Aunt Martha? They can't know, so self assessment will necessarily come into play, because the alternative -- tax all cash flows coming into Thailand -- is bonkers. Thus, I'll memorize the DTA, and know that amounts I send to Thailand that don't exceed my Air Force and Social Security payments (exempt by treaty from Thai taxes) are not taxable; and additional amounts, since it's a Wise transfer from a savings account established with inherited money, I'll just claim FIFO. Now, that accounting term is probably only applicable to inventories, not remittances. But I'll let them chew on that, because who's to say I can't pick and choose from a fungible pot of money. My take: no assessable income here. No tax filing required. (stay tuned, of course)

In one of these threads, someone asked about Thailand's taxation rights on Roth IRA distributions (which are tax exempt in the US), since Thailand has exclusive taxation rights on ordinary IRA distributions (remitted, of course -- for now). Here, in the first quote, is what the IRS says: Well, unfortunately, there's nothing in the US-Thai DTA covering this, unlike in the US-UK DTA, where this, from the tech explanation, is said: I mention this, even tho' the Thai-US DTA doesn't have such exemption language, so that folks with Roth distributions, and the like, can, with full integrity, assume the treaty intended (or would under a protocol) such exemptions. In fact, the latest OECD Model treaties include such language, meaning, if the Thai-US treaty had been written under current OECD guidance, such language would have been included. Hey, it's never going to come to this. Thailand doesn't have the resources, but does have the smarts, to know dissecting every DTA out there for what's what in taxation priority wouldn't be worth the cost or effort. Instead, self-assessment seems to be the way forward, at least as a first step. In my case, I'd now declare my IRA distros to Thailand for taxation, take a tax credit against my US taxes, and have the same total overall tax bill as before. Multiply me by thousands of others, and Thailand could reap some impressive new tax income -- without hiring a zillion new clerks and treaty lawyers. Yeah, a little more paperwork for me -- but not much. So, if you've got a Roth distribution, use the OECD consensus that it's not taxable in Thailand (and that the DTA just hasn't caught up). No integrity issues here -- and it would be an interesting Perry Mason moment if it ever got to that, which it wouldn't.

...... unless he's a tax resident of Thailand, and certain incomes defined in the DTA say Thailand can tax these. If you parse the language in the Code, it doesn't say all US citizens are tax residents of the US -- it says they'll be "treated" as if they're tax residents of the US, meaning, whether their residence is in Boston or Bangkok, their annual tax bill will be the same (with a few exceptions, like having an FEIC). Anyway, yes, some of this language can be confusing. The term "derived" particularly. However, logic would dictate that para 3 is not addressing an American tax resident of Thailand's treatment of an annuity generated by a Thai insurance company. Instead, an immediate pay annuity from the US would logically be treated just like private pensions, IRAs, etc addressed in para 1, namely, Thailand has first taxation rights.

Ok, replace derived with obtained or received. And as previously discussed, taxable "only" means -- in this para on annuities -- exclusivity in the Contracting State of residency, i.e., Thailand. How you arrive at the US having taxing priority over these kinds of annuities is beyond me. But why care? You're liable for taxation on an annuity by both Thailand and the US (due to the saving clause). This should be a neutral taxation situation, due to tax credits -- unless you owe no US taxes (i.e., standard deduction greater than AGI), but owe Thai taxes because your annuity exceeds the allowances and deductions. But, as you've already said -- if you do owe Thai taxes, it won't be much. Relax.

That's what the DTA says that Ben provided. But that's not the norm, at least for private pensions. Here's what the US-Thai tax treaty technical explanation says: "Generally taxable" sounds a little wishy washy. Here's what the actual treaty language says: "Taxable only in that State" implies exclusivity (but, again, there is no exclusivity in US DTAs, due to the saving clause). Anyway, this is why advice on this forum over the years has said to not have your Boeing or IBM pension direct deposited into Thailand, since Thailand would have obvious taxation rights, to include remitted in year earned.

Thank you.

This may help define terms. It's from the Technical Explanation of the US-Thai DTA, and it pertains to Article 6, rents; but the highlighted terminology applies to all articles. The language of the OECD and UN model tax treaties uses this language to define: Exclusive taxation rights, e.g., "taxable only in the first mentioned contracting state." The next level is illustrated above, where "may be taxed" defines the "primary right to tax," leaving the second contracting state with a "secondary right to tax." In the above example, the US would have first taxation rights (primary rights) on rents from property located in the US; but Thailand, if that's where you're a tax resident, can also tax this income. In this example, the US gets to keep all the collected taxes, while Thailand's tax revenue, if any, is what's left after having to absorb the US taxes as a tax credit. Sounds like a waste of time, unless you're in a high Thai tax bracket, and a low US tax bracket..... But, how Thai RD sorts out all these DTA subtleties, if they even decide to, should be interesting.

We must be on different frequencies..... I was responding to your, "If the the USA-Thai DTA article 20 Pars. 2 & 3 are applied, I won't have any tax bill in Thailand at all." And, yes, para 2 will keep your Social Security from being taxed. But para 3 clearly states that any income from an annuity owned by you is taxed by the contracting state in which you are a resident. Thus, Thailand, if you're a tax resident, gets first taxation dibs on your annuity income (if remitted). If you're just saying you won't have any Thai tax bill, it's not from any protection you believe para 3 is giving you.

Yes, for para 2 (Social Security). But para 3 treats annuities the same as private pensions, IRAs, other 40x type plans (para 1), namely: Thailand, as resident country, has exclusive taxation rights (although "exclusive" is moot, since the US also taxes this money via the saving clause, found in all US DTAs). So, if you won't have any tax bill in Thailand, great. But it won't be because of para 3.

If your US tax bill is $100/mo, your Thai taxes will be a one for one tax credit.

I assume your "retirement savings fund" is an IRA, 401k, similar. And, unlike Canadians, the US does not have exclusive taxation rights on private pensions and IRA type programs. So, Thailand has priority taxation rights on your IRA -- but, not your Social Security. So, if remitted, your IRA would be subject to a Thai tax filing. As there's probably no other income to include, maybe after allowances, that IRA would be little enough not to be taxable. If not, it probably wouldn't be much. However, as you say you wouldn't owe any US tax on this, the Thai tax credit would be for nought.

Christ, here we go again. Until they abandon the "remittance" angle, they'll never be able to parse out money "sent" to Thailand (and an ATM pull could be construed as "sent") between savings and income. In my case, all money sent is from a Wise transfer from my savings account, which has money from inheritances, IRA drawdowns, direct deposits of gov't pensions, interest, stock sales, etc. It's a fungible pile of dollars -- and the only before-tax income in there is interest. Now, Thailand says they're going to tax "foreign source income." Fine -- if foreign source income is direct deposited into a Thai bank. Other cash flows coming into Thailand cannot have any income aspect separated from the whole. Thailand knows this -- and that's why we're occasionally hearing, 'we'll just tax all remittances.' I won't even honor that statement with the obvious. So, the only alternative is to identify foreign income at the source, which thru CRS and FATCA reporting, and info exchange language in DTAs -- is relatively easy, compared to the impossible task of identifying income in remittances. Heck, Thailand knows all my income from last year, when I presented a package of 1099 tax forms to BoI -- in my LTR application. Certainly, under the info exchange rules and avenues available today, Thai RD could suck up 1099's of all Americans (and similar for other nationalities). No, the remittance avenue won't work. They'll have to abandon this approach, and go to the income scenario. Or, just abandon the whole thing (which may happen, if Thai fat cats have their say). And, as far as how DTAs might be affected -- Thailand is not about to violate treaties protected by Vienna conventions. Heck, if things go where I think they will, the Thai-US DTA is to their advantage, as now Thailand will have "first dibs" on taxing my IRA proceeds, and other private type pensions. I won't be out any more money, as the Thai taxes will be a credit against my US taxes. But Thailand will now be able to use DTAs to their advantage.

According to the Thai-Canada tax treaty, Canada has exclusive taxation rights on both government and private pensions: Thus, per treaty, your Canadian pension(s) are not "assessable (taxable) income" for Thai tax purposes, and thus there would be no reason to file a Thai tax return showing such income strictly for information purposes. At least under current guidance.

The easiest and safest payment method is: pay on delivery. I use this all the time with Lazada, from furniture to vitamins. Never had to return an item, so don't know how this works. But, certainly paying the delivery man the amount described in the contract, is a no-brainer -- no worries about paying for something never delivered; nor worries about credit card info going astray.

Just create your own fillable fields using Adobe Acrobat. Yeah, I know -- the cost is ridiculous, plus you can't buy it anymore -- you have to subscribe and pay annually. Fortunately, I've some older pirated versions that work just fine -- except with some newer PDF fillable forms. Can you find such software on the street anymore?

Yes, under the current system, where income remitted the following year is tax exempt (and we filter this thru a home bank account, not via direct deposit to Thailand). But if all remittances, whenever remitted, are subject to taxation, and income has to be parsed from savings, then it becomes unmanageable (when I Wise a huge chunk of my savings account to Thailand, a savings account consisting of multiple after tax direct deposits) -- and established with an inheritance -- and where accounting rules, like Fifo or Lifo, don't apply to remittances (these are GAAP terms) -- how are you going to sort out this fungible mess of dollars?). Anyway, we've heard rumblings about converting to an income vice remittance system. And, if Thailand is serious about collecting more taxes from overseas income, then this is the way they'll have to go; because their current 'brought in next year' is very clever at tax avoidance, and doesn't require a parsing between income and savings: It just gives blanket cover to all cash flow sent into Thailand, with the understanding that any income involved had to be earned in a previous year, otherwise the sender was nuts. Now, however, with the new proposed rules, parsing must take place, as you can't tax all remitted cash flow -- and such parsing is impossible, with reasonable screening resources. Thus, we'll either return to the old system, if the fat cats have their way -- or income, not remittances, will be the taxation of the future.

Oh, yawn. How are they going to determine what amount of your remittance to Thailand is income or post-taxation savings? They can't, and they won't, as they're not brain dead about all the negatives being addressed on this thread. Most importantly, foreign direct investment (FDI) would evaporate if the they taxed all remittances -- and they're not about to go there. Yes, there's income out there to be gained, if Thailand did away with the remittance rule (and the Thai fat cats didn't prevent that tax avoidance scheme from happening). So, say they did -- now worldwide income, subject to DTA exemptions or primary taxation authority rules, would dictate how taxation goes forth in Thailand. In my situation (US), I still would not need to declare my Air Force pension and Social Security pay as assessable income in Thailand (as US has "exclusive" taxation rights on those). But my IRA annual payout (due to RMD) would, under the DTA, be taxable primarily by Thailand, with the US as secondary taxation authority -- meaning, Thailand keeps all the taxes; the US keeps only the taxes, if any, not negated by the tax credit from Thailand. For me? Since Thai taxes would be less than US taxes on this IRA payout, my total tax payout from both countries would be no different than under the old rules, where I didn't need to file with Thailand. And, now, in all fairness -- Thailand finally gets those taxes dictated by the US-Thai DTA -- which had been precluded due to the 'remitted in a a later year' Thai law. Fine by me. Anyway, for Yanks, nothing's going to change with your worldwide tax bill -- only that more of your taxes may go to Thailand, where before they went to the US. Thus, no need to plan for a 185 day vacation from Thailand (186 in leap year) to avoid taxes. Now, for those of you screaming about the unfairness of having Thailand tax some of your income, but who now have none of your income being taxed, including in your home country -- welcome to the new OECD effort for "fiscal fairness." And, yes, CRS and FATCA reporting will be a "gotcha" for you, should Thailand go to taxing income, and not remittances. And Thailand really has no choice, as trying to parse remittances for taxation purposes is a non-starter. But, maybe the Thai fat cats will win out, and this new tax proposal will self-destruct. Thailand will survive -- just jump of VAT a couple of points. If you're a Yank, I wouldn't waste too much time reading this thread, as all the doom and gloom doesn't affect you.

Sounds like the Norwegian example. The Norwegian - Thai DTA has Thailand as the primary tax authority for Norwegian tax residents of Thailand, to include Norwegian govt pensions. All's that's required is for Norwegians to produce a Thai tax return, showing that all their Norwegian income was taxed by the Thais. As such, Norway will exclude such income from their taxes, which, in most cases, would be higher than that of the Thais. But, unlike with other DTAs, there is no provision for a tax credit, with the difference being paid into the Norwegian coffer. Instead, it's just: You pay taxes in Thailand, you don't pay taxes in Norway. Nice. I guess Norwegians (and others with similar DTAs) aren't losing too much sleep over these new tax regulations.

Naaa. Identifying misrepresentation suffices as a hobby.

That would be unusual since every other country I file taxes in or have ever filed taxes in, does. Well, in the US, you don't report these on your Form 1040: Gifts, inheritance, welfare payments, alimony (since 2018), child support payments, health care benefits, life insurance proceeds, credit card cash rebates, scholarships, etc. But, yeah, you do report tax exempt interest from municipal bonds, since Uncle Sam needs this to figure your "modified adjusted gross income," which, if too high, means you pay a higher Medicare premium. Anyway, I'll let you worry about reporting all your non-assessable income, lest the fraud police come knocking. Jeez.

Has it ever occurred to you that, the reason for no place to notate non-assessable income, is because they're not interested in income that has no meaning in regards to your tax bill..... Trying to humor you, perhaps....? And your implication that you'd be guilty of fraud, if you didn't provide info on non-assessable income, is just plain weird.

No, but under current rules I have no assessable income, since to be assessable, it has to be remitted in the year earned. Plus, even if remitted in same year earned, my military retirement pay and Social Security would not be assessable income, since the US has exclusive taxation rights, per the DTA, on this income. Maybe I misunderstood an earlier post of yours which seemed to say you filed an annual Thai tax return that included non assessable income......? If so, why would you do this -- do you think the Thais are interested in numbers that don't result in tax revenue?

Completely wrong.

Thailand woke up a few years back, when they noted that first world countries, like the US, collected taxes from non resident Thai citizens, who had bank accounts in the States, and who maybe visited the States as tourists (but never long enough to become tax residents). Such taxes were 'withholding at the source', and defined as 'final taxation.' By fiat, 30% -- but reducible via DTA, and the filing of a W8BEN with the withholder, to 15%. Of course, this would be the only way to get taxes from these folks, as they weren't required to file a tax return. Thus, a fiat 30%/15%, regardless of what tax bracket you might be in, should you file a return. Thailand took note, realizing a lot of long term tourists had bank accounts, but weren't considered tax residents due to time spent here. So, every bank account with a farang identifier, gets 15% withheld -- even my joint account with Thai wife. Pretty smart, actually, as how many affected tourists have the time or inclination to get back some measily baht withholding tax..... And for full time farangs, probably most, with no other tax obligations, let it slide, to the benefit of Thai coffers.