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JimGant
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23 minutes ago, Klonko said:The difficulty lies not in DTA exempt income, but in handling DTA tax credits, in particular if the tax credits only partially offset Thai tax payable.
Yes. For example, US DTA has Thailand as secondary taxation authority on my US rental income. So, Thailand has to absorb a tax credit for the US taxes paid on that rental income. If this credit exceeded what the Thai tax would be (as figured out on the back of an envelope) -- then, I could just ignore including any line item for taxable US rental income -- since, after the credit, there wouldn't be any.
The above scenario works well when netting out credits leaves a negative figure. But when a US tax credit doesn't erase all the Thai taxes due, you're kind of whistling in the wind on how to incorporate that US tax credit on your Thai tax return (since there's no provision for doing so). I guess you could jigger the rental income figure to, after taxation, reflect what it should be after absorbing the US credit. You'd be completely kosher here in paying Thailand all that's due on that rental income. But, trying to explain how you arrived at these figures would be an interesting discussion, should there be a subsequent audit.
Anyway, while the above seems somewhat mysterious, it is completely doable without hiring a 90k tax agent to navigate the mysteries of DTA tax reporting.
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29 minutes ago, Mike Lister said:At this stage in the game, nobody understands how the TRD may handle DTA clauses that are invoked by foreigners, it could even be as simple as check and pass, nobody knows. And since nobody knows, there is no basis whatsoever for the earlier post that I criticised, ergo it is fear mongering and worst case scenario, nothing more.
Hear! Hear!
For Yanks, at least, the DTA with Thailand is straightforward (as are most, since they're based on OECD or UN Model treaty language, where every treaty is a 90% replica of all the others).
What's so difficult about excluding all income from Thai taxation that the treaty says is excludable, like govt pensions? Or for including income in Thai taxation, like a private pension, where the treaty says Thailand has exclusionary taxation rights on such income? This is pretty much straightforward guidance on how income is treated by two countries involved in a treaty. What could be hard about figuring out how this income is treated on each country's tax return..? And can be done without any reference from a DTA on the actual tax return.
But stat says he's had some difficulty invoking DTA guidance. Would love to hear what those circumstances were; I don't doubt they existed, but I'm just curious as to what they were, since my US DTA seems rather straightforward.
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1 hour ago, NoDisplayName said:An audit by the TRD should be quite the experience. There is very little "official" an expat could provide to show home country tax returns........at least for the US.
Not so.
https://www.irs.gov/individuals/transcript-types-and-ways-to-order-them
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1 hour ago, TroubleandGrumpy said:I have had it confirmed by 2 tax accountant organisations that if I want to lodge a tax return using any part of a DTA for exclusions or allowances or just plain exemptions, I will need to provide detailed techncial and legal information that will be almost impossible for a layman to do in Thailand - they said I will need to use their services
I don't believe it. My US DTA gives the US exclusive taxation rights on my Air Force pension and Social Security. Thus, these figures never need to be shown on a Thai tax return, as there's no taxable income value to them (and where would you put them anyway?). Now, per DTA, Thailand has primary taxation rights on my IRA. So, I report this income, in full, on a line on the Thai tax return. Thailand gets to keep all the taxation, which is all they care about. That the DTA allows a tax credit against my US taxes -- is a no never mind for Thailand TRD -- as they're just happy to collect the full bundle -- and also that they need not report anything to the US IRS (my credit reporting on the US tax return is purely self-assessment, with no official Thai tax return data needed). Thus, this taxation proceeds as if there were no DTA, at least in the mechanics of preparing the return.
So why would you need to pay an agent 90k to file a tax return that uses DTA language to assess which income is reportable on a Thai tax return -- and which isn't? You can figure this all out yourself, assuming average intelligence, as DTA language is not that hard to decipher. Just keep a legible record of how you arrived at these figures, in case you're called in for an audit. Which, in my example above, would be 100% kosher. And probably would be for most other DTA situations.
Sounds like the tax preparation vultures are beginning to successfully scare the low hanging fruit. Beware.
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1 hour ago, Mike Lister said:there's a new emphasis on foreigners filing returns and declaring income.
Says who? There's probably a new desire for foreigners -- with TAXABLE income -- to file a tax return, and pay the appropriate taxes. But a desire to have someone with 120k in assessable income -- but who is 380k short of taxable income (after deductions/allowances/150k freebie) -- to have to file a nil tax return -- is NUTS! Why would TRD want to deal with all that worthless paper, and the cost of processing it....?
But, yes, if now you realize that the new remittance rules mean you owe taxes -- by golly, go get a TIN, and then file a tax return, and pay the taxes owed (and then, per DTA, deduct those taxes from your home country tax return).
But if you don't owe Thai taxes -- then don't get a TIN, don't file a nil tax return, and then relax. The worst that can happen is -- in the miniscule chance they'll call you in -- and you did, indeed, have assessable income exceeding 120k -- you'll owe a 2000 baht fine -- which is cheaper than all that effort to get a TIN and to file a tax return -- assuming your time is worth something.
So, use your common sense with this. Yes, if you owe taxes, file and pay. But if you don't -- not to worry about certain suggestions, including the big house, without vaseline.
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15 hours ago, Mike Lister said:
The TRD Code states that a Thai tax resident must obtain a Thai TIN, within 60 days of exceeding the minimum threshold (60k, 120k or 220k) regardless of whether tax is payable or not.
And if you don't -- naughty, naughty, naughty.
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6 hours ago, Mike Lister said:
Your statement that "there will and must come more clarification from the TRD" is interesting....I'm betting not, why would there be
Yeah, why, indeed, would there be any clarification needed. Thus, as there's nothing in the Thai tax code about accounting convention for remittances -- you're then free to choose whatever convention best suits your bottom line. For me, that's FIFO.
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On 7/1/2024 at 9:41 AM, Moonlover said:
do not use the 'Funds for long term stay' option. That always introduces a delay.
I don't believe purpose of transfer would affect the other parameters. But, I'm curious as to why you think so.
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On 6/26/2024 at 8:33 AM, LuckyG said:
Would a will be considered invalid if not registered?
Absolutely not.
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3 hours ago, NoDisplayName said:I would suggest the assumption will be any funds remitted will be considered assessable unless shown otherwise.
Come on, folks. Use your heads. Are they going to consider all the zillions of dollars of inbound cash flow as assessable income? Then what -- or so what -- will they then interview the owners of all those zillions as to why no Thai tax return was filed? No way. Self-assessment is the only way this thing will work. Yes, if someone has a substantially large remitted amount of money, and no tax return -- then call him in for a chat. But I suspect, to keep these random large-scale audits manageable, what constitutes a 'substantial amount of remittance' will be a rather high number.
But why worry about how they consider all remittances? Makes no difference if you're honest. Just crunch your numbers, and if you have taxable income (i.e., assessable income exceeding allowances, deductions, and the 150k freebie), file a tax return. Period.
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1 hour ago, Mike Teavee said:
So If you switch Thailand for the UK then I am using an overseas credit card (from UK) in Thailand & authorising the overseas/UK credit card company to pay the bill for the goods or service & if I pay that using cash in the UK would be taxable remittance in Thailand IF they applied the same rules.
Interesting -- kinda turns a credit card into a debit card -- and seemingly at odds with their statement I provided. Anyway, hard for me to get my head around this UK carve-out for taxing remittances, just for folks who are "non domiciled residents." Huh?
But, re Thailand -- I guess the operative word in your statement, above, is: IF
And if they don't use the UK example in any definitive guidance -- I'd be comfortable in equating a credit card loan to a loan for a condo. Certainly, this would be a logical argument -- in the unlikely event there would ever be a discussion with TRD on my credit card charges, on which they'd have little to no data.
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40 minutes ago, TroubleandGrumpy said:
Another one - are you serious mate - sanctimonious statements like that just prove you are wrong IMO.
OK, you're right -- only the USA can tax US income. Whew. No more worries about Thai taxation, as US income is all I have.
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6 minutes ago, TroubleandGrumpy said:
if a USA citizen living in Thailand receives a lump sum termination payment in USA, will they be liable to pay income taxes on that amount to Thailand. My understanding is that USA Citizens only pay income taxes to USA on money earned in USA
I've already quoted the Thai-US DTA, giving primary taxation rights to Thailand on certain kinds of pensions, to include periodic payment pensions, and lump sum pensions. Believe I answered this question in my previous post.
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1 hour ago, Mike Teavee said:
Other guys opinion is that a Credit Card purchase is a short term loan & loans are not considered to be assessable income, I originally thought the same but found out that the UK treats any Credit Card purchase as remitted income & as that's the only country I'm familiar with that taxes on a remittance basis changed my opinion.
Nope. For those UK folks subject to remittance tax, here's what is said about using a UK issued credit card to make purchases, either in the UK, or abroad.
QuoteIf a taxpayer who is chargeable on the remittance basis uses a UK credit card to pay for goods or services, either in the UK or overseas and he or she subsequently settles their credit card bill using foreign income or gains, the payment is a taxable remittance.
https://www.gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis/rdrm36130
So, only if you pay off your UK credit card bill with foreign source income or gains, will it be considered a taxable remittance. Pay it off from your UK bank -- no remittance tax.
Thus, only if I pay off my US credit card bill with, say, a check from my Bangkok Bank account -- or any other foreign source money, will the credit card charges being paid off be considered the equivalent of remitted foreign source income (using the UK example, which is the only one I can find).
So, when I purchase something in Thailand with my US credit card -- and pay it off from my US checking account -- this is not the equivalent of treating the purchase value as a marker for foreign source remitted income. Even if the money I pay it off with would be considered assessable foreign source income -- had it been remitted to Thailand to make that purchase in lieu of my credit card.
Thus, a credit card loan to buy a hamburger in Bangkok is treated the same as a bank loan to buy a condo in Bangkok. Both are loans, and both are paid back from a US source -- and are thus not treated as the equivalent of foreign source remitted income.
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40 minutes ago, shdmn said:
Hmmm, 200+ pages of clowns and conspiracy theorists doing their usual whining, or a Thai tax lawyer that does this for a living. So hard to decide who to listen to.
Bingo!
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58 minutes ago, TroubleandGrumpy said:Your second statement in bold above is also nonsense. The USA does not prevent other countries from taxing income that arises in the US.
Of course it's nonsense. The Thai-US DTA is very clear on which US incomes are taxable by Thailand. As an example, private pensions, IRAs, and 401k distributions are primarily taxable by Thailand. Now, the treaty language actually says Thailand has "exclusive" taxation rights on this income. But the treaty's "saving clause," found in all US tax treaties, gives the US at least secondary taxation rights, "as if the treaty language did not exist." Thus, effectively Thailand has primary taxation rights on my IRA, meaning, they get to keep all the collected taxes; while the US, with secondary taxation rights, gets to tax my IRA -- but has to absorb a tax credit for the Thai taxes paid.
And, yes, the US Tax Code does not allow a tax credit for foreign taxes paid on US income -- UNLESS an exception, via international tax treaty, can be shown. This is done by attaching a Form 8833 to your US tax return: "Treaty-Based Return Position Disclosure." Thus, the Internal Revenue Code is trumped by an international treaty. Thailand pockets my taxes in full; and the US pockets the difference, should the Thai tax credit be less than the US taxation.
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3 hours ago, sqwakvfr said:
Would it be a blanket or all encompassing exemption regardless of the income? I only used 50K but some have pension that are much higher. Some have pension that are not taxed by the US Governemnt because some have been declared disabled up to 100% and are not subject to US Income Taxes.
All pensions paid for prior govt service are EXCLUSIVELY taxable only by the US. Period. Makes no difference the amount of the pension, or whether or not it is exempt from US taxation. Social Security also exclusively taxable by the US.
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5 hours ago, Mike Lister said:
Ask yourself, does the way in which the funds are delivered make any difference, TT or cash via ATM
Actually, I think you nailed it in an earlier post, where you said ATM transactions could not be tracked, thus no data for TRD to make any tax evasion case -- unlike for transfers into your bank account, which, of course, would have data for TRD to ask about, "why no tax return?" Thus, just nonsensical to pursue ATM transactions.
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2 hours ago, lordgrinz said:
Lets hope they don't operate like the Immigration Office, because some piece of paper you just printed off online won't cut it.
We still get all our bank statements hard copy, snail mail -- since the wife isn't computer literate for such retrievals.
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3 hours ago, NJHOUSE said:
I have all my year-end statements with the available balance. They can watch me log into my account and retrieve these statements in real time if they want. What else do you think they expect?
Right on!
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7 minutes ago, lordgrinz said:"If" either one of you gets audited, then I will be all ears on how it panned out.
I think the ruling that pre 2024 income is tax exempt from any remittance -- is on pretty solid ground.
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1 hour ago, Neeranam said:
I don't know if I have to declare this to the tax man, anyone?
Not according to a tax professional from MTG associates, whose video was referenced here. Hey, when interpretations of all this new tax stuff is in such a state of flux -- pick the answer that best suits you, and your bottom line (and hope the matter is not later redefined, to your disadvantage). And, of course, record this source's bonafides, for possible use at a later chat with TRD.
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1 hour ago, lordgrinz said:
Yes, because B6 million will go unnoticed by RD? I'm waiting to see how people fair when they try that theory.
I've already sent 5M baht this year to Thailand, in four installments via Wise. Wise taps my savings account, which on Dec 31, 2023, was well north of 5M baht. And, for future wires, I'll have my IRA RMDs (or more, if needed) sent to my savings account -- up to the amount my IRA was valued at on Dec 31, 2023. I guess I could even have my Air Force pension (non assessable via DTA) direct deposited to my savings account. Thus, I'll have a savings account that could never run out of tax exempt remittances, at least in my lifetime.
I guess if I sent many years' worth of large remittances -- and hadn't filed any tax returns 'cause remittances were non assessable income -- TRD might call me in for a chat. But, so what. I'll show them my bank statements and Wise transfer statements. Completely covered.
That I keep good records is just my nature, and not for any deep worry about TRD inquests -- since plan A is my LTR visa. Good records, tho', would be there if plan B is needed.
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19 minutes ago, tomkenet said:
But In my home country I get free good quality schools for my kids, good quality healthcare and I get voting rights and equally treatment.
The most scary part however is having to deal with a revenue department with bad English skill.
Sounds like you're a perfect candidate for not moving.
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Thailand to tax residents’ foreign income irrespective of remittance
in Thailand News Headlines
Posted
Exactly where on the return would you put this information? Per the DTA, this income does not exist for any Thai taxation purpose. Are you suggesting the TRD wants footnotes of all non assessable income not being reported?