Investment Income

[baldkeys]

We hope to retire to Thailand in the near future. We understand that, to avoid having to pay personal income tax, it is possible to arrange for banks to automatically deduct 15% from interest paid on fixed deposits. (Such interest will be the bulk of our retirement income.) That's OK for us if the net amount payable is still around 3% of the amount deposited, as it usually is for 12 month deposits at the moment. However, it seems that interest rates are likely to come down in the near future. Can anyone advise whether there are any safe alternatives to fixed bank deposits in Thailand? (We don't want to play the stock market.) Thanks.

[Naam]

We hope to retire to Thailand in the near future. We understand that, to avoid having to pay personal income tax, it is possible to arrange for banks to automatically deduct 15% from interest paid on fixed deposits. (Such interest will be the bulk of our retirement income.) That's OK for us if the net amount payable is still around 3% of the amount deposited, as it usually is for 12 month deposits at the moment. However, it seems that interest rates are likely to come down in the near future. Can anyone advise whether there are any safe alternatives to fixed bank deposits in Thailand? (We don't want to play the stock market.) Thanks.

forget income tax. you won't pay any as a retiree. i tried to find a way to pay voluntarily a fair amount and the most sympathetic advice was that i should go to a shrink to get rid of my hallucinations.

[soundman]

We hope to retire to Thailand in the near future. We understand that, to avoid having to pay personal income tax, it is possible to arrange for banks to automatically deduct 15% from interest paid on fixed deposits. (Such interest will be the bulk of our retirement income.) That's OK for us if the net amount payable is still around 3% of the amount deposited, as it usually is for 12 month deposits at the moment. However, it seems that interest rates are likely to come down in the near future. Can anyone advise whether there are any safe alternatives to fixed bank deposits in Thailand? (We don't want to play the stock market.) Thanks.

forget income tax. you won't pay any as a retiree. i tried to find a way to pay voluntarily a fair amount and the most sympathetic advice was that i should go to a shrink to get rid of my hallucinations.

On funny pills today are we?

Cheers,

Soundman.

[Firefan]

Baldkeys is refering to the automatically withheld tax on interest from Thai banks of 15% - I.e. nothing to do with retirement account (here in Thailand). Baldkey; it is automatic and you do not have to do anything - and nobody will come asking for income tax on it.

Interests are in the 3-5% range currently. Other (safe) alternatives can be government bonds (short) or gov. bond funds. That said, I would personally not put all in Thailand but rather also in high interest/bond funds abroad for diversification and thereby lower risk.

Real inflation in Thailand is at LEAST 5%, with personal experiences, Incl. mine, being closer to the 10% range - some of that is caused by oil price increases - but there are many other reasons. No matter the reason one should know that at 3% return per year(which one spend) - the REAL buying power of the "safe" nest egg actually drops 5-10% per year. I.e. elsewhere in ones "portfolio" there should be some inflation protection, whether that is inflation adjusted pensions, inflation adjusted bonds or maybe (the horror!) a small exposure to the equity and commodities markets?

Cheers!

[Naam]

We hope to retire to Thailand in the near future. We understand that, to avoid having to pay personal income tax, it is possible to arrange for banks to automatically deduct 15% from interest paid on fixed deposits. (Such interest will be the bulk of our retirement income.) That's OK for us if the net amount payable is still around 3% of the amount deposited, as it usually is for 12 month deposits at the moment. However, it seems that interest rates are likely to come down in the near future. Can anyone advise whether there are any safe alternatives to fixed bank deposits in Thailand? (We don't want to play the stock market.) Thanks.

forget income tax. you won't pay any as a retiree. i tried to find a way to pay voluntarily a fair amount and the most sympathetic advice was that i should go to a shrink to get rid of my hallucinations.

On funny pills today are we?

Cheers,

Soundman.

not on funny pills but informed.

[Naam]

Baldkeys is refering to the automatically withheld tax on interest from Thai banks of 15% - I.e. nothing to do with retirement account (here in Thailand). Baldkey; it is automatic and you do not have to do anything - and nobody will come asking for income tax on it.

i am aware of that and that's why "baldkeys" should keep his money offshore, free of income tax and transfer whatever amounts he needs for living expenses. that of course besides the mandatory THB 800k in the bank for the retirement visa.

nota bene: "Individuals residing for 180 days or more in Thailand for any calendar year are also subject to income tax on income from foreign sources if that income is brought into Thailand during the same taxable year that they are a resident."

of course nobody with a sound mind would transfer money which was "earned the same year" but only amounts "earned in an earlier year".

[naka]

Yes, keep the bulk of your funds offshore ... preferably in a tax free location.

like the Channel Islands.

Why bank in Thailand and get 3% minus 15% tax when you can get 6% in the Isle of Man with no tax

(after you have established your tax free status).

Only bring to Thailand what you really need to have here. If your funds are offshore they are easily transferable,

If they are in Thailand they may not be !

Naka.

Edited May 2, 2007 by naka

[Naam]

Yes, keep the bulk of your funds offshore ... preferably in a tax free location. like the Channel Islands.

Only bring to Thailand what you really need to have here. If your funds are offshore they are easily transferable, If they are in Thailand they may not be !

BINGO! by the way, Singapore beats the Channel Islands. no need to "establish" tax free status which is granted automatically.

[LoveDaBlues]

Yes, keep the bulk of your funds offshore ... preferably in a tax free location. like the Channel Islands.

Only bring to Thailand what you really need to have here. If your funds are offshore they are easily transferable, If they are in Thailand they may not be !

BINGO! by the way, Singapore beats the Channel Islands. no need to "establish" tax free status which is granted automatically.

When you say "beats" the Channel Islands do you mean in interest rates paid? BTW, can I open a Singapore account online or would it require going there in person?

As an American I thought any interest I made ANYWERE on deposits I was required to report and pay taxes on. Am I wrong?

Thanks. LDB

[LoveDaBlues]

Baldkeys is refering to the automatically withheld tax on interest from Thai banks of 15% - I.e. nothing to do with retirement account (here in Thailand). Baldkey; it is automatic and you do not have to do anything - and nobody will come asking for income tax on it.

Interests are in the 3-5% range currently. Other (safe) alternatives can be government bonds (short) or gov. bond funds. That said, I would personally not put all in Thailand but rather also in high interest/bond funds abroad for diversification and thereby lower risk.

Real inflation in Thailand is at LEAST 5%, with personal experiences, Incl. mine, being closer to the 10% range - some of that is caused by oil price increases - but there are many other reasons. No matter the reason one should know that at 3% return per year(which one spend) - the REAL buying power of the "safe" nest egg actually drops 5-10% per year. I.e. elsewhere in ones "portfolio" there should be some inflation protection, whether that is inflation adjusted pensions, inflation adjusted bonds or maybe (the horror!) a small exposure to the equity and commodities markets?

Cheers!

Can you post the Thai bank that currently pays 4% or more for fixed time deposits? Thanks, LDB.

[No beleeeeve!]

Can anyone post some links to some safe offshore/Singapore bank locations???

[8ball]

I am a UK citizen currently resident in Australia; I have some property and investments in both countries. In future I would like to live/retire to Thailand, what sort of Investment structure would be advisable to avoid any tax in Thailand. If I sell any of my properties whilst residing in Thailand would I be liable to CGT in Thailand?

Also would tax be payable on any investment income I receive? I am interested to find out more about offshore banking as I feel that this may suit my needs.

Thanks for any input,

Cheers,

8ball

[Naam]

Yes, keep the bulk of your funds offshore ... preferably in a tax free location. like the Channel Islands.

Only bring to Thailand what you really need to have here. If your funds are offshore they are easily transferable, If they are in Thailand they may not be !

BINGO! by the way, Singapore beats the Channel Islands. no need to "establish" tax free status which is granted automatically.

When you say "beats" the Channel Islands do you mean in interest rates paid? BTW, can I open a Singapore account online or would it require going there in person?

As an American I thought any interest I made ANYWERE on deposits I was required to report and pay taxes on. Am I wrong?

Thanks. LDB

you are right and "taxwise" unlucky that you are an american. but if you move your savings out of the U.S. of A. the IRS won't know what you are making.

[Naam]

I am a UK citizen currently resident in Australia; I have some property and investments in both countries. In future I would like to live/retire to Thailand, what sort of Investment structure would be advisable to avoid any tax in Thailand. If I sell any of my properties whilst residing in Thailand would I be liable to CGT in Thailand?

Also would tax be payable on any investment income I receive? I am interested to find out more about offshore banking as I feel that this may suit my needs.

the answer is a clear NO. Thailand has most favourable tax laws as far as offshore income, capital gains and the like are concerned. these laws also apply for thai citizens. please read my remark "taxable if..."

[Naam]

When you say "beats" the Channel Islands do you mean in interest rates paid?

interest rates are more or less identical but Singapore's banking secrecy laws beats those of the Channel Islands. the chancellor of the exchecker has no access to accounts located in Singapore but he might soon have access to accounts located in the Channel Islands.

BTW, can I open a Singapore account online or would it require going there in person?

i am not 100% sure about that inspite of the fact that i am banking in Singapore. normally the documents (a huge bunch!) are sent back and forth by courier service. a pain in the @ss are nowadays the worldwide "compliance regulations" forced on the banks by the U.S. you have to fill out a lot of forms and state that your money was acquired legally, you are neither a drug dealer nor a money launderer nor a terrorist. some banks are even impertinent enough and ask you to submit a short curriculum vitae. it's silly but then paper is patient and you can write down whatever you want. nobody checks it as the banks just want to cover their butts.

a mandatory requirement to open an account in Singapore is that you have to verify your place of residence by submitting any utility bill stating your name and address.

[Naam]

Can anyone post some links to some safe offshore/Singapore bank locations???

http://www.getformesingapore.com/Info_banks.htm

[lanny]

As an American I thought any interest I made ANYWERE on deposits I was required to report and pay taxes on. Am I wrong?

Thanks. LDB

You are correct, American citizens and permanent residents (green card holders) are subject to US income tax on their worldwide income. Earned income, up to $82,400, may be excluded if you so elect and file a return but "non-earned" income, such as dividends and interest, does not qualify for this.

[LoveDaBlues]

As an American I thought any interest I made ANYWERE on deposits I was required to report and pay taxes on. Am I wrong?

Thanks. LDB

You are correct, American citizens and permanent residents (green card holders) are subject to US income tax on their worldwide income. Earned income, up to $82,400, may be excluded if you so elect and file a return but "non-earned" income, such as dividends and interest, does not qualify for this.

Yes, this is what I thought.

What I'm really looking for then is an institution that:

(1) is solid & reliable and pays roughly 5% on time deposits

(2) does not report anything to the account holders home country

does such an institution exist?

[rambling]

Check Citibank International Personal Banking in Singapore. http://www.ipb.citibank.com.sg

Can anyone post some links to some safe offshore/Singapore bank locations???