JimGant

12 minutes ago, Mike Lister said:

The quote is therefore not specific and directly relevant to Gift Tax, or potentially not even relevant to it at all,

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.

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I and others assumed your post to be sarcasm rather than an objective assessment

 Sarcastic, how? That really has me scratching my head.

You need to include your post, upon which I was commenting on:

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 I agree, we already said:

 

"The Thai Revenue Code does not consider the purpose of the funds that are imported, only whether the funds are assessable or not. For example, funds imported to buy real estate will be viewed in the same way that imported funds for any other purpose will be, there's nothing special about the fact those funds are buying property versus anything else"

Then, my observation:

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 Well, Mike, I think I finally found the answer to the question I've asked you several times, namely: What makes a remittance of assessable income no longer assessable or taxable -- because the end destination of this remittance is a gift? Well, of course, being an end destination as a gift doesn't -- as your answer above clearly states -- there's nothing special about (the assessability of remitted income) due to its final destination. Nothing - not real estate purchase, new car purchase, bill paying, stock investment, soi dog foundation, and gift. And RD doesn't care if it's a real gift, or bogus -- they get their tax payment upfront, before it's distributed, as either a real gift; a bogus gift, with recipient acting as an intermediary; or as a payment to the recipient, for services or products rendered. Those actions have separate tax implications.

So, as you say above, there's no tax exemption of remitted foreign assessable income for any final purpose, to include gifts. There. Glad we got that settled.

 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

1 hour ago, Middle Aged Grouch said:

LTR is absolutely not worth applying considering all the bureaucratic hassle, all the absurd documents they ask day to day or invent and the fact that every year one has to show all the updated absurd documents for insurance etc asked and thus making this LTR definately not a hassle free for 10 years.

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....

2 hours ago, Mike Lister said:

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.

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?

1 hour ago, Etaoin Shrdlu said:

Nor does Mr U have to pay Thai personal income tax for this 1m. He never got this money in Thailand.

For tax purposes, he effectively did.

1 hour ago, Lorry said:

So, what if Mr U transferred the money to Mr T's US bank account, supposed Mr T has a US bank account?

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.

1 hour ago, Mike Lister said:

I do not agree that Thai Gift Tax has nothing to do with the source of the gift, if that source is attempting to avoid Thai tax by claiming the remittance was a Gift to another, when in reality it was intended to be returned to the gifter.

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.

10 hours ago, Mike Lister said:

Gift Tax will work where genuine gifts to relatives are involved, but it is highly unlikely to be robust where the gift is intended to be a work around, is not genuine and involves non-relatives.

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.

6 hours ago, CARLO BALDASSARRE said:

After the age of 60 my australian pension is non taxable , therefore maybe seen in thailand as a taxable income from overseas ....we shall see....!!!.

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:

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However, the State of residence, under subparagraph (b), must exempt from tax any
amount of such pensions or other similar remuneration that would be exempt from tax in the State in which the pension scheme is established if the recipient were a resident of that State. Thus, for example, a distribution from a U.S. "Roth IRA" to a U.K. resident would be exempt from tax in the United Kingdom to the same extent the distribution would be exempt from tax in the United States if it were distributed to a U.S. resident.

https://home.treasury.gov/system/files/131/Treaty-UK-Protocol-TE-7-22-2002.pdf

 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.

56 minutes ago, Klonko said:

The Deputy Director of the Legal Affairs Division of the TRD (Swiss Embassy Townhall February 27, 2024):

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

2 hours ago, Yumthai said:

Gifts are exempted for the purpose of income tax calculation according to RD Section 42 (27) (28) (29). No mention of remittance.

Yes, but again it is the recipient, not the giver, who's on the hook for taxation above a certain amount of gift:

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Income derived from maintenance and support or gifts from ascendants, descendants or spouse, but only for the portion not exceeding twenty million Baht throughout the tax year.

 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.

1 hour ago, Etaoin Shrdlu said:

I think that for laundering statutes to kick in, at least in Thailand, the source of the funds has to be an illegal activity.

You're right. Good catch.

10 minutes ago, Etaoin Shrdlu said:

I think that if the amount given is less than 10 million baht and the gift can be completed outside Thailand, then the gift could be remitted by the recipient without incurring a Thai tax liability. This would require the recipient to have a bank account outside of Thailand.

Yeah, seems like a doable filtering, er laundering scheme.

5 minutes ago, stat said:

Maybe you should mention a source for "TRD will probably set up a system to tap the broader tax base after the the following year remittance loophole has been closed". Otherwise pls label your view as gut feeling. Nothing absolutley nothing points in the direction you mentioned.

Of course there's no source -- this whole thread is mainly conjecture. And, actually, Eta's conjecture makes a lot of sense. Pretty impressive gut feeling, IMO.

2 minutes ago, Mike Teavee said:

They (TRD) don’t need to check with anybody, they just need to ask you about your Tax affairs

So, TRD will use expensive resources to screen all farangs, not just tax residents -- in order to determine who's a tax resident, or a tourist, so they can then restrict their questions to just tax residents?

20 hours ago, Klonko said:

TRD has publicly stated that, while foreign income of a Thai tax resident remitted to himself is tax assessable, traditional gifts [remitted from the benefactor's foreign account to the beneficiary's Thai account] are not subject to income tax.

They've never said that. Assessable income, whether remitted to your bank account, your GF's bank account, a PO Box, or a shelter for soi dogs -- is still remitted assessable income, subject to Thai taxes, if it exceeds exemptions and allowances.

Where folks are getting confused is -- unlike in the US (and I assume other Western countries), the gifter is the one who pays the gift tax (or gets a credit towards a final estate tax). And it is a gift tax, not income tax, on after-tax income, i.e., disposable income now inclusive in the estate. Thailand, however, apparently taxes the recipient, not the gifter:

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As a countermeasure for possible avoidance of the inheritance tax, the Thai Revenue Code was amended to include a new gift tax which came into effect on the same date as the ITA. In brief, an individual receiving certain types of gifts in excess of the tax-free thresholds will be subject to personal income tax at the rate of 5 percent of the exceeding portion with an option to exclude such income from annual income tax computation.

https://www.thanathippartners.com/insights/legal-update/inheritance-tax-and-gift-tax-t2u2.html?show=4

Thus, a gift to your GF is totally divorced from your taxability on this money -- that action is separate from the gifting action. Now, your GF is in an interesting situation. If she gave nothing of value for the receipt of that gift, then, yes, it is a gift -- and she'll have to file a personal income tax return to declare an amount over 10M baht. However, if she gave several really superb hum jobs, she gave value for the money received -- so now she has to declare the whole enchilada as income. In both situations, she's the one filing a tax return for the money you gave her, not you adding this on to any tax return you had to file. But if that gift you gave was assessable remitted income to Thailand -- you've got to declare it on a tax return, as it has no exclusionary aspects by later becoming a gift (or income for rendered services). Sorry, folks. The gift aspect doesn't seem to be a viable tax avoidance. 

7 hours ago, Mike Lister said:

Many people filed under the old rules, I'm one.

Did you actually have taxable income, i.e, assessable income above TEDA -- and thus actually paid income tax to Thailand? Just curious, because you've previously reported that you showed up at the TRD office, declared all your remitted income, and then asked them to discern which was assessable, and which wasn't. Wouldn't the prudent man keep TRD out of the self-assessment phase -- and just keep his self-assessment logic to himself, until the less than 1% chance of a knock on the door?

Obviously, Thai RD never evaluated farang remittances for income applicability, under the old rules, since the fungibility of cash flow could certainly blur same-year remittances -- and what a waste of time and money to try and corner this blur. And, now, farangs can claim pre 2024 income as tax free remittances -- plus several DTA rulings exempting foreign income. No, the cost/benefit analysis says Thai RD is not going to hire 10000 new agents to question tens of thousands of farang non tax payers -- only to find out that there's no there there.  Any new taxes under this new ruling will come from Thai fat cats, who under the old rule, could remit unlimited amounts under the later year rule. Now, Thai fat cats, who have no DTA exemptions to hide behind, will feel the sting. We've already seen, on one of these threads, where Thai RD can assess taxes, of their determination, in situations where 'too much remittance and not enough tax paid' occurs. This is where the new rule will probably bear fruit. Farangs aren't even an after thought, IMO.

7 minutes ago, Presnock said:

Now those arrested will probably beg Biden to forgive their college loans too.

....and ask for laundry fee reimbursements for their Hamas head rags.

18 hours ago, Felton Jarvis said:

Thailand has never paid any attention to Amnesty International of any other organization supporting "human rights'. 

Understandably so, since AI is not culturally sensitive to Thailand's monarchy system. But having said that, ask the average Thai on the street if he's upset that Thailand has some firm restrictions about large crowd gatherings on the street, particularly if those crowds are directed at certain restricted activities. Heck, even Singapore has more restrictions on crowd gatherings than does Thailand (and, yes, AI has directed itself against Singapore -- whose citizens, when factoring in reality, laugh it off).

No, when you look at the freedoms Thailand actually has compared to those in the neighborhood (Cambodia, China, Burma, Laos, and Vietnam), life here, from a human rights standpoint, is quite ok. And, yes, you *do* need a certain degree of domestic real politik -- that drives the hand wringers nuts -- to preserve and promote daily harmony. Need a little more of that back on the campuses in the US. Sure, Thailand could probably cut some slack on youthful exuberation --as the young sometimes just don't know how good they actually have it, until they grow up and factor in reality.

So, let the human rights long hairs moan and groan. Thailand is doing just fine, thank you -- again, when compared to the neighborhood.

10 hours ago, sabaiguy said:

Told them I had 2023 1099-R,  which they accepted in lieu of the 1040.

My 1040 is a married joint return, so the line items are joint, thus not reflecting my portion. Thus, 1099-Rs submitted for each of my taxable items. 1040 submitted as a courtesy copy, but totally worthless in the math department. 1099-Rs totally accepted, with, of course, a cover letter of explanation. Also, only the previous year's tax data required -- no two year requirement, as had been mentioned somewhere. And, current year monthly pay statements, with a cover letter showing monthly payments multiplied by twelve, to arrive at annual amount (duh). Simple math exercise, totally acceptable to BoI.

22 minutes ago, CartagenaWarlock said:

Now I'm in the US.

Are you a US citizen? If so, why do you think your total tax bill, between both countries, will be higher than if the pre 2024 Thai tax rules were still in effect?