The taxman comes calling for crypto investors

[webfact]

The crypto tax will cover five sources of gains: sales or exchange of digital assets, crypto mining, receiving crypto as wages, getting digital assets as gifts or rewards, and benefits or investment returns from holding crypto and digital tokens. (Photo by olieman.eth)

 

Investors are worried about their tax liability and the method of calculation after the Revenue Department issued on January 31 tax guidelines for individuals engaging in crypto and digital token activities.

 

Thais and expats (subject to double-taxation agreements) are required to file annual personal income tax returns by March 31 based on their income earned in the previous year.

 

The tax handbook is the result of extensive discussions between revenue officials and representatives from the crypto community who had strongly objected to levying capital gains tax on crypto investment.

 

Full story: https://www.thaipbsworld.com/the-taxman-comes-calling-for-crypto-investors/

 

-- © Copyright Thai PBS 2022-02-08

 

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[KannikaP]

And if the value of my BitCoins has gone down ??????

[Card]

57 minutes ago, KannikaP said:

And if the value of my BitCoins has gone down ??????

I think the tax only applies when you cash in the cryptos through a bank. If u don't cash it in you won't be taxed, just like most investments, where the profits are only taxed when you cash them in.

[ukrules]

Does this apply like all other earnings tax?

 

Specifically only to profit made inside Thailand during the current tax year?

 

Lets say I sold 10 Bitcoin for about $500k on December 20, 2022 in some foreign country and then had that $500k wired to my account on January 5th. some of it would be profit from the previous tax year, or indeed profit accumulated over many years of simply holding the coins and not selling or trading them at all, profit from abroad.

 

Had that profit been made from any other source (like I cashed in half my Apple shares after a very profitable split) in a foreign country then I believe it would not be taxable as the profit was not deposited in Thailand until the following year.

 

The reason I ask this question is that it was 'proposed/announced' a few years ago by someone in charge of making new rules that because 'blockchain is global' then the tax would cover all global income on crypto - that would be one massive exception to the existing rules.

 

This is an important point that requires clarification.....

[Pravda]

59 minutes ago, Card said:

I think the tax only applies when you cash in the cryptos through a bank. If u don't cash it in you won't be taxed, just like most investments, where the profits are only taxed when you cash them in.

 

Yes. Thailand has one of the worst tax rules on the planet. The same applies to condos. They tax you even if you had a 90% loss. What sane person would want to have their money on any Thai exchange? 

 

[ukrules]

2 minutes ago, Pravda said:

 

Yes. Thailand has one of the worst tax rules on the planet. The same applies to condos. They tax you even if you had a 90% loss. What sane person would want to have their money on any Thai exchange? 

 

Like I mentioned in my post above, the proposal from a few years back suggested that the tax on anything 'crypto' would also tax foreign earnings and apply to previous years profits.

That is what they were talking about going after at the time but we're talking a good few years ago now and many such proposals disappear along the way to legislation - like the withholding tax proposal - that's now gone, I wonder if the foreign / previous year profit thing has now also disappeared.

 

 

 

 

[how241]

It is interesting that if the word 'taxes' and 'crypto' are used together,  many act as if this is the end of the world.  For some reason, when it comes to most all other assets/investments  taxes are considered normal and expected. 

[Dazinoz]

What I am having difficulty with is the Australian Taxation Office taxing unrealised assets.

 

Ok to explain. I have had my ADA staked with Daedalus for around 17 months. For those who don't know they pay "interest" every 5 days in ADA. Talking to my tax agent he informed me that I needed to keep a spreadsheet of each interest earned every 5 days and what the value of ADA was on that day and that had to be declared as income on my last and future tax returns. Last financial year I earned an extra 4269 ADA at a value of $4338 which had to be declared. As I said this is an unrealised asset as the value could be even zero at time of sale. Yes it could be much higher and I would benefit. I have no problem paying my taxes (I don't like it of course) but it just seems taxation offices can see money going out the window so they are making whatever grabs they can.

[ukrules]

1 hour ago, how241 said:

It is interesting that if the word 'taxes' and 'crypto' are used together,  many act as if this is the end of the world.  For some reason, when it comes to most all other assets/investments  taxes are considered normal and expected. 

Dream on, if they taxed foreigners on their foreign income this place would become a ghost town with only 'the skint' remaining.

 

Why do you think many people actually live in Thailand?

 

Think of oil and gas workers, people who have many millions invested in foreign stock markets.

 

Do you actually think any of them pay local tax on their foreign profits?

 

This also applies to Thais who I am assured take every advantage of the rules.

[brucegoniners]

Hilarious!

 

And what makes Thailand believe they'll be any better at tracking crypto transactions than anyone else.

 

Whoever said this doesn't know a thing about it.

[Heng]

Well when you transfer funds out of Thailand through their internet banking interface, at least Bangkok Bank (and likely others) has that note: 'if this transaction is related to cryptocurrency, it needs to be reported to the Bank of Thailand.'     Sure thing.

[Jenkins9039]

2 hours ago, Heng said:

Well when you transfer funds out of Thailand through their internet banking interface, at least Bangkok Bank (and likely others) has that note: 'if this transaction is related to cryptocurrency, it needs to be reported to the Bank of Thailand.'     Sure thing.

Not currently happening, nor are the exchanges providing information (they do to SEC & AMOL) because they can't determine when the crypto was purchased.

 

Aside from that, exchange offshore, wire funds in, tax free after 12 months, take a chance under 12 months.

 

What interests me, is whether you've moved say USDC/USDT in AFTER 12 months whether there's a tax converting that to THB (as income, or as Capital Gains).

[khunphil]

On 2/8/2022 at 1:17 PM, Card said:

I think the tax only applies when you cash in the cryptos through a bank. If u don't cash it in you won't be taxed, just like most investments, where the profits are only taxed when you cash them in.

Cash in through a bank or trade to Fiat in the exchange ? Any confirmation on this point ?

[Neeranam]

What about P2P transfers on exchanges such as Binance?

What about if I buy gold from a gold shop using my crypto.com card, then sell that gold  a year later?

I think they will never be able to tax everyone, there are too many ways to avoid paying taxes.

 

[Jenkins9039]

On 2/18/2022 at 12:10 AM, Neeranam said:

What about P2P transfers on exchanges such as Binance?

What about if I buy gold from a gold shop using my crypto.com card, then sell that gold  a year later?

I think they will never be able to tax everyone, there are too many ways to avoid paying taxes.

 

Would be considered tax evasion, structuring, conspiracy, and money laundering, if you are a yank.

[Heng]

And like any good American, you can simply find a way to launder, structure, and evade in a perfectly legal way and just spin it.  (I'm not supporting war, I'm just invested in Raytheon....I'm not evading taxes, I'm minimising my tax profile...)     

[Whale]

On 2/8/2022 at 2:16 PM, ukrules said:

Lets say I sold 10 Bitcoin for about $500k on December 20, 2022 in some foreign country and then had that $500k wired to my account on January 5th. some of it would be profit from the previous tax year, or indeed profit accumulated over many years of simply holding the coins and not selling or trading them at all, profit from abroad.

I don't think they will have anyway of knowing what the source of funds are other than what you claim on the transfer (i.e. "for living expenses") from your personal savings account.

 

In nearly 30 years of transferring money in I have never been asked and neither have I volunteered to declare. 

I see this whole thing as only relevant to Thai exchanges cashing to Thai banks.