Any Westerners long staying in Thailand - ever tax investigation?

[Tanoshi]

1 minute ago, simoh1490 said:

From previous threads on this subject I recall a small number of people being required to pay tax on income from rental property in Thailand.

That's because it's regarded as income earned from within Thailand, same as interest earned on Fixed term bank accounts and other higher interest paying accounts.

 

If the amount earned (on which tax is deducted) is under the personal allowance permitted by Thai revenue, then the tax can be reclaimed.

[ubonjoe]

A off topic video has been removed.

[anon789561]

as far as i understand it you are supposed to pay witholding tax on any money brought over here, that includes money earnt abroad

[stevenl]

2 hours ago, Tanoshi said:

Then please explain why thousands of expats have their foreign incomes paid directly into Thai banks every month, but are not taxed by Thai revenue. That would be current income, not income from previous years.

Answer, because if the foreign income exceeded their personal allowance, it has already been taxed and is therefore not subject to tax in Thailand.

 

Whilst that may not be true of all Countries, most European Countries have these tax agreements with Thailand.

That would be because Thai tax department is not very active.

[stevenl]

2 hours ago, glegolo said:

So I wonder if you even really like what you are saying yourself? I mean, you work during a lifetime in your home-country, pay into your pensionfond over maybe 45 years, and then you say that people overall would prefer that USA Sweden Britain Australia should give away that tax-income to Thailand.... You didn´t think this thru I guess.....

 

glegolo

It is really easy: in some countries home country doesn't charge, but living country. So in case home country doesn't charge but living country does, people get paid gross and receive gross, big savings there. So yes, I think people would prefer to not pay taxes than the home country charging.

Edited May 21, 2018 by stevenl

[OJAS]

2 hours ago, stevenl said:

Who mentions double taxation? Tax treaties often include it should be paid in the land where they are living. So not in home country but in Thailand.

 

1 hour ago, simoh1490 said:

The UK does have a DTA with Thailand.

And Articles 7 & 19 of said DTA make it clear that income derived from UK property and UK public sector occupational pensions respectively, which together form the lion's share of income in my case, is only taxable in the UK:-

 

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/507424/uk-thailand-dtc180281_-_in_force.pdf

 

Thus it would appear that I would only, in theory, be liable to be taxed in Thailand on my perpetually-frozen State Pension. And much good would the resultant peanuts generated for the Royal Thai Exchequer, of course, do in practice!

 

However, those in receipt of UK private sector occupational pensions would also appear to be liable to be taxed in Thailand as a result of the DTA.

 

 

[anon789561]

5 minutes ago, stevenl said:

That would be because Thai tax department is not very active.

that's basically it. it doesn't mean one day they won't be and back date all your taxes owed. most people i know out here don't pay any witholding tax. don't need to but look to the future and see if thailand wakes up and decides it wants that money, which it probably will at some point.

[ubonjoe]

16 minutes ago, Happy enough said:

that's basically it. it doesn't mean one day they won't be and back date all your taxes owed. most people i know out here don't pay any witholding tax. don't need to but look to the future and see if thailand wakes up and decides it wants that money, which it probably will at some point.

Not sure how taxes due could be withheld for income that comes into by the country by way of a transfer. Not sure any country does that.

Some countries do require transfers over a certain amount to be reported.

 

[anon789561]

2 minutes ago, ubonjoe said:

Not sure how taxes due could be withheld for income that comes into by the country by way of a transfer. Not sure any country does that.

Some countries do require transfers over a certain amount to be reported.

 

the question is then, are people like myself who earn money abroad supposed to pay tax on it, which at the moment i am. i'd rather not but have been told i have to by an accountant friend. bearing in mind that VAT has been paid in the UK but not income tax

[ubonjoe]

40 minutes ago, Happy enough said:

the question is then, are people like myself who earn money abroad supposed to pay tax on it, which at the moment i am. i'd rather not but have been told i have to by an accountant friend. bearing in mind that VAT has been paid in the UK but not income tax

You could do a annual tax return to the revenue department by showing the the income that was transfered into the country and pay the taxes that are due. 

You would need a tax ID number to do it.

[NoshowJones]

"What does this stupid farang want here?!?"  Thais saying farangs are stupid?? Surely not?

[canda]

4 hours ago, simoh1490 said:

From previous threads on this subject I recall a small number of people being required to pay tax on income from rental property in Thailand.

Think you will find that rather than being taxed on income directly, at the time one sells a property a higher percentage of tax is applied if rental income has been earned, also more so if the property is less than 5 years old.

CANDA.

[abrahamzvi]

5 hours ago, glegolo said:

Yes I know, but thought maybe good to widen your horizon a bit, and show that there are countries that have done this the proper way, and easiest way for their own citizens.

 

glegolo

Whether the income concerned is derived from pensions or otherwise, expatriates only have to pay tax on the amount imported into Thailand, provided, of course, they don't work here. Additionally, if one can prove that the income imported into Thailand has been earned in previous years ( not the tax year which is being declared on) such income is not taxable. This is the legal situation. Whether people act accordingly, or ignore the tax, must be considered by the individuals concerned themselves.

[micmichd]

5 hours ago, stevenl said:

Not true, quite a few pensioners are paying taxes here, sometimes triggered by questions from back home about tax payments. So in order to avoid paying back home they pay here.

What about deferred compensations? Are they taxed in Thailand even if you worked for them in the West?

[stevenl]

1 hour ago, micmichd said:

What about deferred compensations? Are they taxed in Thailand even if you worked for them in the West?

Is there a tax treaty between the country involved and Thailand?

[Lacessit]

Australia has a DTA with Thailand. Money I earn on investments in Australia is taxed in Australia.

The interest I earn on my retirement account here is taxed here. I understand it is possible to get a refund; however, I can't be bothered with the bureaucratic hoops I would have to jump through.

[Wilson Smith]

2 hours ago, canda said:

Think you will find that rather than being taxed on income directly, at the time one sells a property a higher percentage of tax is applied if rental income has been earned, also more so if the property is less than 5 years old.

CANDA.

it would be hard to believe that the only tax liability would come when one would sell. Sure there would be an income tax liability work permit or not. 

[impulse]

Past performance on the part of the tax authorities is no guaranty of future security. 

 

Just ask the thousands of long stay guys who crafted a decades long Thai life for themselves on monthly visa runs and occasional 20K overstay fines, only to leave it all behind when those loopholes no longer worked.  They figured they were safe, but...

 

I envision the day that some will be stopped on exit at Swampy and presented with a tax bill based on years and years of unreported earnings that come to light as tax department technology develops to where they can figure out how much that travel blog is making, and tax treaties share more and more information.  Or, fill in a thousand other tricks that work today.

 

My bet for the first thing that's going to bite someone?  That idea that income earned outside the country in one year isn't taxable in Thailand if it's brought in the following year.  As if you can segregate money in your account so that only the untaxable part of your savings account comes to Thailand.

 

To be clear, I'm not saying any of that has happened.  Just like I wouldn't have claimed in 2013 that anyone had ever been blacklisted for overstay.  I hope it doesn't happen, but I still remember the sad stories of the guys who sold me their bicycles, golf clubs and kayaks because their Thai adventure had come to a tragic end- some even leaving families behind.

[mokwit]

It is still on the statuates that you have to tax clearance if you have spent more than 180 days in TH and are exiting. It was enforced as recently as the '80's I think and the statement about tax used to be on TM47 until very recently. Old timers who remember please chime in. Remeber 90 day reporting was on the statuates bit had stopped being enforced and now is.

 

I just don't believe there will be no revisions to Thai tax and immigration laws over the next 20 or even 10 years. IMO it may come to it that if they have a record of someone staying here for more than 180 days through 90 day reports but no tax records they may call you in to explain. They can already triangulate like this.

Edited May 21, 2018 by mokwit

[tubby johnson]

45 minutes ago, impulse said:

I still remember the sad stories of the guys who sold me their bicycles, golf clubs and kayaks because their Thai adventure had come to a tragic end- some even leaving families behind.

If true, then I hope you paid them a decent price for the loot in order to help them with their painful exits.

[VBF]

1 hour ago, mokwit said:

It is still on the statuates that you have to tax clearance if you have spent more than 180 days in TH and are exiting. It was enforced as recently as the '80's I think and the statement about tax used to be on TM47 until very recently. Old timers who remember please chime in. Remeber 90 day reporting was on the statuates bit had stopped being enforced and now is.

 

I just don't believe there will be no revisions to Thai tax and immigration laws over the next 20 or even 10 years. IMO it may come to it that if they have a record of someone staying here for more than 180 days through 90 day reports but no tax records they may call you in to explain. They can already triangulate like this.

That all makes sense  but if logic was applied (I know, TIT!) wouldn't anyone on a Retirement extension be assumed (!) to be retired and therefore not earning anyway? 

Don't flame me here - I'm more asking than telling 

 

One related question - is the minuscule amount of interest paid 6-monthly on a bank account in Thailand taxed at source?  Just wondering.....

[topt]

8 hours ago, Tanoshi said:

Wrong.

https://www.gov.uk/government/publications/thailand-tax-treaties

This has come up before. If you read your link I defy you to find anything in their specifically about pension payments which is what I was referring to. I will try and find the other link referred to before which shows this.

 

8 hours ago, simoh1490 said:

The UK does have a DTA with Thailand.

Disappointing and unlike you to reference a partial quote - I actually said -

8 hours ago, topt said:

Unfortunately the UK does not have a DTA with Thailand that is applicable to the state and private pension payments unless you are an ex government/forces employee.

My bolding and underline.

[simoh1490]

2 minutes ago, topt said:

This has come up before. If you read your link I defy you to find anything in their specifically about pension payments which is what I was referring to. I will try and find the other link referred to before which shows this.

 

Disappointing and unlike you to reference a partial quote - I actually said -

My bolding and underline.

Sorry, I missed that part, my apologies. 

[canda]

1 hour ago, Wilson Smith said:

it would be hard to believe that the only tax liability would come when one would sell. Sure there would be an income tax liability work permit or not. 

Why would I need a work permit to own properties here ?

I pay an agent & accountants do any work, they keep me informed on what 's required.

[Tanoshi]

30 minutes ago, topt said:

This has come up before. If you read your link I defy you to find anything in their specifically about pension payments which is what I was referring to. I will try and find the other link referred to before which shows this.

The existing taxes which are the subject of this Convention are:  
 
(a) in the United Kingdom:  
(i) the income tax;  
 

(f) the term "person" comprises an individual, a company and any body of persons which is treated as an entity for tax purposes;  
 

[dabhand]

1 hour ago, mokwit said:

It is still on the statuates that you have to tax clearance if you have spent more than 180 days in TH and are exiting. It was enforced as recently as the '80's I think and the statement about tax used to be on TM47 until very recently. Old timers who remember please chime in. Remeber 90 day reporting was on the statuates bit had stopped being enforced and now is.

 

I just don't believe there will be no revisions to Thai tax and immigration laws over the next 20 or even 10 years. IMO it may come to it that if they have a record of someone staying here for more than 180 days through 90 day reports but no tax records they may call you in to explain. They can already triangulate like this.

Yes indeed. I recall needing to obtain a tax clearance certificate around 1990 as I had been in Thailand in excess of 180 days during that year. I was not working in Thailand, merely being between contracts for my UK company. I vaguely recall that a travel agency advised me of the requirement (no Thaivisa in those days!) with a total cost of around Bt4,000 coming to mind. This possibly being a set tax charge based on nil local income, likely inclusive of an 'admin' fee.

 

Based on the below link, this requirement was ended in May 1991(Section 3, 2nd para). But it does look like it could be brought back simply with a revised D-G notification. Now, that would make things interesting, particularly given the huge increase in potential punters who would fall into this category. 

http://www.rd.go.th/publish/23518.0.html

 

[Montnoveau]

9 hours ago, glegolo said:

So I wonder if you even really like what you are saying yourself? I mean, you work during a lifetime in your home-country, pay into your pensionfond over maybe 45 years, and then you say that people overall would prefer that USA Sweden Britain Australia should give away that tax-income to Thailand.... You didn´t think this thru I guess.....

 

glegolo

IF we are talking Sweden, then there are actually no money in those pensionfunds, you only earn the 'rights' to get the pension in the future, which will be paid for those who are working then.

 

You have paid for the retirements of the previous generations.

Today I am paying for them who are retirees today, not for my self.

 

It is only the 'tjänstepension' and 'PPM' funds that contains any actual money, these money are your own.

 

 

 

 

[Paulbuick1]

Those who live in Thailand for more than half the year are considered to be resident in the country for the purposes of tax. If you are resident then you are expected to pay taxes on all income that you earn worldwide. If you are not a resident and are in the country for less than 180 days each year then you are only expected to pay tax on the income that you get from within Thailand. I

[impulse]

2 hours ago, tubby johnson said:

3 hours ago, impulse said:

I still remember the sad stories of the guys who sold me their bicycles, golf clubs and kayaks because their Thai adventure had come to a tragic end- some even leaving families behind.

If true, then I hope you paid them a decent price for the loot in order to help them with their painful exits.

 

I paid every satang they were asking, without negotiating.  That said, they were all fair prices.  Or, to be accurate, I didn't even contact the many sellers asking ridiculous prices while advertising "urgent sale".   But that's another topic for another thread.

 

[topt]

1 hour ago, Tanoshi said:

The existing taxes which are the subject of this Convention are:  
 
(a) in the United Kingdom:  
(i) the income tax;  
 

(f) the term "person" comprises an individual, a company and any body of persons which is treated as an entity for tax purposes;  
 

See page 34 here - https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/707093/Digest_of_Double_Taxation_Treaties_April_2018.pdf

 

It specifically states no relief under "Other Pensions" with a specific Note 4 to the side

This was also mentioned by @OJAS in post#36 which also referenced your original link. I take no joy in this but UK people should at least be aware of it.