Something new - I earned 20 baht in interest and they took out 3 baht TAX

[how241]

3 hours ago, YT3k72Em said:

The only option they have is the report to RD or not choice. I will try and get them set to report and then see what happens next week

As long as they report your info,  they should not take out tax according to the revenue letter.  It may be too late for this tax period and you can claim it back if it is worth the trouble.  What I find interesting is that the banks seem to by default assume that you do Not want to report and thus withhold tax.  I guess they know that 98% will not bother to claim back small money and they are right.  I have a few accts.  that I won't even bother to change or take back the tax as the amounts are small.  The Banks/govt.  wins again

[Felt 35]

https://sherrings.com/capital-gains-personal-income-tax-thailand.html

 

???? Hmm.....seems from now that its best to keep greater savings out of here and interesting to see how quick this change come in the light of the latest demand about dosh in bank year around for retirement visa????

[Pib]

27 minutes ago, Felt 35 said:

https://sherrings.com/capital-gains-personal-income-tax-thailand.html

 

???? Hmm.....seems from now that its best to keep greater savings out of here and interesting to see how quick this change come in the light of the latest demand about dosh in bank year around for retirement visa????

 

Naw....this started early last year when the revenue dept found out some banks were not reporting interest earned properly on certain types of accounts.....and some banks were actually recommending to their customers that when they approach Bt20K interest earned to close the account and immediately open another account/roll the money over to restart the Bt20K clock for that year. 

 

When the revenue dept uncovered these abuses they started discussions with the Bank of Thailand and banks to figure out how to stop the tax dodging/abuse.  Not until Apr/May 2019 did the Revenue Dept come out with their final regulation change.

 

And the link you gave deals with tax on mutual funds/stocks/etc., versus this withholding tax on bank savings accounts.  But is a good example of how Thailand is tightening up tax regs/laws in order to get more revenue.

Edited June 26, 2019 by Pib

[Orton Rd]

1 hour ago, Kwasaki said:

???? Yeah matter of principle OK but come on no matter what country your in if they change tax laws there's nothing you can do about it, it's just not worth worrying about.

OP can get his 3 bht back eventually.

why subsidize these corrupt wretches, they are already stopping us spending our own money if you are on a retirement extension, i'll be claiming every last baht back off them

[Kwasaki]

21 minutes ago, Orton Rd said:

why subsidize these corrupt wretches, they are already stopping us spending our own money if you are on a retirement extension, i'll be claiming every last baht back off them

Depends for me I take my money out put back a few times a year, what tax is taken at the end of bank term is not worth going to tax office for it would cost me just as much in diesel there and back.

[how241]

1 hour ago, Pib said:

Naw....this started early last year when the revenue dept found out some banks were not reporting interest earned properly on certain types of accounts.....and some banks were actually recommending to their customers that when they approach Bt20K interest earned to close the account and immediately open another account/roll the money over to restart the Bt20K clock for that year. 

 

When the revenue dept uncovered these abuses they started discussions with the Bank of Thailand and banks to figure out how to stop the tax dodging/abuse.  Not until Apr/May 2019 did the Revenue Dept come out with their final regulation change.

I hear what your saying BUT this change with the retirement requirements certainly does work in the Thai banks favor as they continue to pay less interest than the west does. It won't be long before they update their computers system and can easily see the TOTAL amount you have in all Thai banks spread across the many different Thai banks.    Big Brother is watching !!!

[how241]

3 minutes ago, Kwasaki said:

what tax is taken at the end of bank term is not worth going to tax office for it would cost me just as much in diesel there and back.

Agreed.  It the tax taken is not at least 1,000 baht it is hardly worth the time and effort to try and reclaim it.  It might aggravate some people NOT to claim back small money but when you think about how people blow money everywhere,  you have to remember the big picture. 

[Felt 35]

6 hours ago, how241 said:

I hear what your saying BUT this change with the retirement requirements certainly does work in the Thai banks favor as they continue to pay less interest than the west does. It won't be long before they update their computers system and can easily see the TOTAL amount you have in all Thai banks spread across the many different Thai banks.    Big Brother is watching !!!

I hear you...and  in a few years more we will ending up paying tax on not only income/pensions transferred to Thailand but also assets included savings currently abroad. Due to a on-going tax system upgrade here which with time will be transparent and connected to databases in banks both here and abroad. All this of course for they here more than 180 days a year and then a resident for tax purposes.

Thanks to "Big Brother" on the other side of the dam.

[how241]

9 minutes ago, Felt 35 said:

Thanks to "Big Brother" on the other side of the dam.

Yes, agree.  The USA makes a lot of problems with their attempts to track everything.  They try to blame it on money laundering but I am not buying that.  You can't hardly use cash anymore in the USA.  I had HSBC  close my acct.  because I bought and sold 2 cars in a month.  One for 6K ,  another for 5K  BUT they thought all that cash was suspicious.  Total  B/S ...Lucky I made my Thai accts.  when I came here in 2011  as many Thai banks do not want USA customers.  Too much paperwork they say.  I believe them .

[adisornc]

A bank manager at Thanachart bank once told me that the 20,000 interest income exemption from tax only applies to Thai citizen. As a Thai citizen, I have not seen any deduction on my bank accounts.

[inThailand]

Is this next tax on bank accounts just a consequence? Now that we need to leave more visa money in the bank?

[Captain 776]

Gee complaining about 3 bhat.....lolol

 

Let me guess which country u are from.....,,,but I wont, cuz it brings 7 days on the bench

[moe666]

Good they are taking tax from you free loaders. I own stock here in Thailand and have been paying interest on dividends and cap. gains since day one, around 10 years.

[atyclb]

"I earned 20 baht in interest "

 

nice, at least you have something to look forward to for the 800,000 baht

[VBF]

Oddly enough I noticed this only yesterday. I post this merely as an "FYI" supporting the thread.

 

My SCB account which I've had for at least 15 years pays interest twice-yearly and the June interest is in. For the first time ever, there was a tax deduction shown on it. Whether the tax was already being deducted but not shown, I really don't know.

 

As the amount i keep in the account is so small (and therefore so is the interest and resulting tax) that I think i shall ignore it. 

 

Edited June 27, 2019 by VBF

[how241]

7 minutes ago, VBF said:

Oddly enough I noticed this only yesterday. I post this merely as an "FYI" supporting the thread.

 

My SCB account which I've had for at least 15 years pays interest twice-yearly and the June interest is in. For the first time ever, there was a tax deduction shown on it. Whether the tax was already being deducted but not shown, I really don't know.

 

As the amount i keep in the account is so small (and therefore so is the interest and resulting tax) that I think i shall ignore it. 

 

Exactly the same story with me . 

As long as they report your banking/tax info,  they should not take out tax according to the revenue letter.  It may be too late for this tax period and you can claim it back if it is worth the trouble.  What I find interesting is that the banks seem to by default assume that you do Not want to report and thus withhold tax.  I guess they know that 98% will not bother to claim back small money and they are right.  I have a few accts.  that I won't even bother to change or take back the tax as the amounts are small.  The Banks/govt.  wins again

[how241]

3 hours ago, moe666 said:

Good they are taking tax from you free loaders. I own stock here in Thailand and have been paying interest on dividends and cap. gains since day one, around 10 years.

Nothing about being free loaders. Thailand and the USA have a dual tax agreement so you don't get charged tax in 2 countries.  Do a little Google reading for a better explanation of this.  Over the years, I also have had stocks and dividends.  You are legally allowed to claim back every baht that was withheld from your stock dividend.  You can still do it ,  going back up to 3 years ago.  If you choose not to reclaim your tax money that is certainly your choice BUT you are legally allowed to do so.   Another GREAT day in Pattaya. 

[VBF]

11 minutes ago, how241 said:

Exactly the same story with me . 

As long as they report your banking/tax info,  they should not take out tax according to the revenue letter.  It may be too late for this tax period and you can claim it back if it is worth the trouble.  What I find interesting is that the banks seem to by default assume that you do Not want to report and thus withhold tax.  I guess they know that 98% will not bother to claim back small money and they are right.  I have a few accts.  that I won't even bother to change or take back the tax as the amounts are small.  The Banks/govt.  wins again

So whatever the letter says, it seems we don't really know if they're taking the tax and reporting, or taking the tax and not reporting. I don't really care (as I said above) but would be nice to know.

Edited June 27, 2019 by VBF

[how241]

1 minute ago, VBF said:

So whatever the letter says, it seems we don't really know if they're taking the tax and reporting, or taking the tax and not reporting. I don't really care (as I said above) but would be nice to know.

Good point !   This might just be free-easy money for the banks but we will never really know.  It doesn't really matter to me as this is a Thai issue. 

[Skeptic7]

Like everything here...totally unclear and contradictory to what is being reported and in the document provided by Pib. 

 

From article in ThailandBusinessNews back in April...

 

"He said bank customers shouldn’t panic because no tax would be charged if their savings account amounted to less than four million baht."

 

Full story: 

https://www.thailand-business-news.com/banking/72075-thai-banks-to-tax-savings-interest-above-20000-baht.html

[Jaxxper]

My understanding is that the Thb 20,000 tax free is still good, however I think the revenue folks believed that many of those that are not in the tax system had split their assets across different banks so as to appear that < Thb 20 k was being earned. By implementing the 15% withholding from all interest / accounts it ensures that all interest is being taxed. I guess the onus to reclaim the withholding is on the account holder.

Not sure how you would go about claiming the withholding back though. For £500 of tax, not sure I'd want to open that can of worms though.

[Skeptic7]

6 minutes ago, Jaxxper said:

My understanding is that the Thb 20,000 tax free is still good, however I think the revenue folks believed that many of those that are not in the tax system had split their assets across different banks so as to appear that < Thb 20 k was being earned. By implementing the 15% withholding from all interest / accounts it ensures that all interest is being taxed. I guess the onus to reclaim the withholding is on the account holder.

Not sure how you would go about claiming the withholding back though. For £500 of tax, not sure I'd want to open that can of worms though.

Just another Thai money grab. Many people won't know/care or won't want to be bothered/not worth it = millions more baht clipped from the farang. Place is more of a Clip Joint every day.  

[quandow]

A new requirement for retirees to keep minimum 800k baht and now a tax on all interest? Coincidence? Hmmmm . . .

[how241]

2 hours ago, Skeptic7 said:

Like everything here...totally unclear and contradictory to what is being reported and in the document provided by Pib. 

The article mentions about 4 million baht BUT they are assuming that everyone has the standard,low paying accounts that pay .05%. 

[JimGant]

20 hours ago, how241 said:

Yes, agree.  The USA makes a lot of problems with their attempts to track everything.  They try to blame it on money laundering but I am not buying that

FATCA, and the subsequent OECD CRS, is about tax evasion, not so much money laundering:

Quote

The Common Reporting Standard (CRS) is an information standard for the Automatic Exchange Of Information (AEOI) regarding bank accounts on a global level, between tax authorities, which the Organisation for Economic Co-operation and Development (OECD) developed in 2014.

Its purpose is to combat tax evasion. The idea was based on the US Foreign Account Tax Compliance Act (FATCA) implementation agreements and its legal basis is the Convention on Mutual Administrative Assistance in Tax Matters. 97 countries had signed an agreement to implement it, with more countries intending to sign later. First reporting occurred in 2017, with many of the rest starting in 2018.

So, eventually, automation will connect your world financial holdings to a common data base. Owe taxes on any of these elements -- knock knock.

 

The OECD is already redrafting boilerplate tax treaty language, to eliminate dual no payment taxation. Heretofore, it has been too easy to avoid paying either the mother country, or the new country of residence any taxes -- because the treaty language built to avoid dual taxation had too many loopholes. That will soon change, with most countries adopting something akin to the US's savings clause, which requires, regardless of treaty, declaration of all worldwide income on your home country tax return -- then, tax credits to avoid dual taxation.

 

For Yanks, you're already declaring that piddly Thai bank interest on your Form 1040, Schedule B, right? (If not, here comes the FATCA potential of banks reporting said interest.) So, if Thai banks are going to withhold taxes on that same interest, just take a credit for it. Lower amounts don't even require filing a related Form 1116. Thus, you end up with no dual taxation, and a few extra key strokes.

 

Yeah, the fly in the ointment is this:

Quote

Taxes paid to a foreign country that you don't legally owe, including amounts eligible for refund by the foreign country, aren't eligible. If you don't exercise your available remedies to reduce the amount of foreign tax to what you legally owe, a credit for the excess amount isn't allowed.

Kinda says, if you can get a refund at the tax department, you're thus not eligible for a tax credit. But, I've seen some reports here on Thai visa where getting a tax ID number (required for the refund) was denied due to no work permit. Surely a bureaucratic oddity, but, nonetheless, a reason why I wouldn't waste the time and fuel to get a refund. And surely a good enuf reason for the IRS, should they even waste resources on such a below-the-radar happening. Besides, there's no tax evasion here -- Thailand, per the tax treaty, is getting first taxation dibs on interest earned in its country; the US, per treaty, has to give a credit. You, the taxpayer, have paid no less, and no more, in taxes.

 

So, come next tax filing, should Bangkok Bank start withholding taxes, I'll just plug in a few extra data elements into my Turbotax filing. Easy.

[how241]

Good post,  JimGant  with lots of info.  It seems as if the IRS  and others try their best to make things as hard/complicated as possible to understand and comply with.  Thanks for the info.  My opinion,  unless the tax refund amount is sizable it might be better/easier to just cross it off as another fee for living here. 

[Naam]

1 hour ago, JimGant said:

The OECD is already redrafting boilerplate tax treaty language, to eliminate dual no payment taxation. Heretofore, it has been too easy to avoid paying either the mother country, or the new country of residence any taxes -- because the treaty language built to avoid dual taxation had too many loopholes. That will soon change, with most countries adopting something akin to the US's savings clause, which requires, regardless of treaty, declaration of all worldwide income on your home country tax return -- then, tax credits to avoid dual taxation.

that seems to be a fairy tale as most countries don't require a citizen living abroad to file a home country tax return.

[JimGant]

10 hours ago, Naam said:

that seems to be a fairy tale as most countries don't require a citizen living abroad to file a home country tax return.

Yeah, some like Norway, just withhold 15% at the source of income generated in the home country on their expats. Don't bother to file, unless you've paid a foreign country, per treaty, taxes on same income. Then you can get a refund.

[Briggsy]

Gosh, me too. 55 Baht tax taken from my savings account interest. First time ever withholding tax was taken from savings account interest. Won't bother to reclaim it. Fancy that, I didn't see that coming.

[Chai19]

Smell another rat here

Only 15% on foreigners interest

Not on Thai accounts!t