Thai gov. to tax (remitted) income from abroad for tax residents starting 2024 - Part I

[Tony M]

2 hours ago, rabas said:

This is what they will do January 1, 2024.

 

Translation of the new rule:

Section 1: A person who is Persons residing in Thailand according to Section 41, paragraph three, of the Revenue Code who have assessable income due to work duties or activities conducted abroad or because the property is in Foreign countries according to Section 41, paragraph two of the Revenue Code In the said tax year and took that assessable income Entering Thailand in any tax year That person has a duty to include that assessable income in the calculation. To pay income tax according to Section 48 of the Revenue Code In the tax year in which the assessable income was brought in in Thailand.

 

From this coconut article:

The change announced September 15 is meant to close a loophole in the tax system that allows people to avoid paying income tax on foreign assets and earnings by leaving the income abroad until the next tax year.

 

But my UK property rental income is declared in my annual tax self-asessment. So is it covered by the DTA, or will I have to pay tax twice on that income  ?

[ThomasThBKK]

32 minutes ago, RafPinto said:

Wrong: if you go for the "wealthy pensioner visa: either 80k$ a year or 40k$ a year but must have for example a property here for at least 250k$

Can also be a house if you have a "30year lease on it"

Interesting, is there any more info about this, i mean the lease part? 

Would superficies or usufruct also apply? 

[RafPinto]

12 minutes ago, mokwit said:

This is what I mean by 'being reflected in the share price'. When you see that kind of yield you often see a 50% capital loss. If you wanted to get all theoretical the market is pricing in what the dividend will be, not what it currently is, and hence the current high yield.

You're only at a loss if you bought the share double the price they are now with half the yield.
If you buy now, chances that a good company drops another 50% are very low and your take now your higher dividends.
All about timing the market.
The ones who bought f ex Shell during Covid are now 160% up.
Buy when others sell and sell when everyone goes in.
I'm soon out of Shell as I see better  opportunities now.

[mokwit]

2 minutes ago, RafPinto said:

You're only at a loss if you bought the share double the price they are now with half the yield.
If you buy now, chances that a good company drops another 50% are very low and your take now your higher dividends.
All about timing the market.
The ones who bought f ex Shell during Covid are now 160% up.
Buy when others sell and sell when everyone goes in.
I'm soon out of Shell as I see better  opportunities now.

Thanks, hadn't realised buying low and selling high was that easy.

 

First piece of investment advice I remember was get hold of a 50 year old newspaper stock page and see how many names you recognise. I did, and it was not many - they weren't all taken out at a premium.

[RafPinto]

8 minutes ago, Thaindrew said:

RETIREES AGED 50 YEARS AND OLDER WHO HAVE AN ANNUAL PENSION OR STABLE PASSIVE INCOME

you have to be retired for the wealthy pensioner LTR and thats the only one you can do $40K plus $250K

 

Global citizen need the $500K invested

Work from Thailand LTR need to work for a company with turnover of $150M over 3 years thats limiting factor to many

 

NO

Do you know someone who is retired at 50 and is drawing a pension?

 

I got accepted and do not draw any pension.

Personal income under LTR : Wealthy Pensioners’ definition is “unearned income such as a pension, rental, capital gain, dividend, etc”. Earned income (salary) will not be considered eligible income for LTR: Wealthy Pensioners application.

 

[Neeranam]

15 minutes ago, mokwit said:

Do you think that is sustainable?. Perhaps you can tell us HOW 19% that return is generated. Also WHY are they paying out that much when returns are lower elsewhere?

Polkadot's potential for providing substantial returns for staking can be attributed to several factors:

1. Nominated Proof-of-Stake (NPoS) Consensus Mechanism: Polkadot uses a Nominated Proof-of-Stake consensus mechanism, which allows token holders to nominate validators they trust. Validators are responsible for producing blocks and validating transactions. This system incentivizes token holders to participate in staking by earning rewards in the form of DOT tokens.

2. Incentives for Validators: Validators on the Polkadot network are rewarded for their services. They receive a portion of the transaction fees and the newly minted DOT tokens as block rewards. The competition among validators for these rewards encourages them to maintain a high level of performance and security.

3. Nominator Rewards: Individuals who stake their DOT tokens and nominate validators can also earn rewards. Nominators receive a share of the rewards earned by the validators they nominate. This further incentivizes participation in the staking ecosystem.

4. Staking Yield: The total staking yield in Polkadot depends on various factors, including the number of tokens staked, the inflation rate, and the percentage of tokens participating in staking. When more tokens are staked, the rewards are distributed among a smaller pool of stakers, potentially leading to higher individual rewards.

5. Governance and Governance Rewards: Polkadot's on-chain governance system allows token holders to vote on proposals and changes to the network. Those who actively participate in governance decisions may also earn additional rewards. This incentivizes token holders to engage with the network's development and decision-making processes.

6. Network Growth: Polkadot is a rapidly evolving ecosystem with various parachains (parallel blockchains) and projects being developed on its platform. As the network expands and attracts more users and developers, the demand for DOT tokens may increase, potentially driving up the token's price and staking rewards.

It's important to note that while the potential for high returns exists in Polkadot staking, it also comes with risks. Staking involves locking up your tokens for a period, and the rewards are subject to market volatility and network conditions. Additionally, there may be slashing penalties for validators who misbehave, which can affect staking rewards. Therefore, individuals considering staking in Polkadot or any other blockchain network should conduct thorough research, understand the risks, and consider their investment goals and risk tolerance.

[RafPinto]

4 minutes ago, ThomasThBKK said:

Interesting, is there any more info about this, i mean the lease part? 

Would superficies or usufruct also apply? 

As far as I understand, you register the 30 years usufruct.
Not sure is that counts as a 30 year lease.

[mokwit]

8 minutes ago, Neeranam said:

Polkadot's potential for providing substantial returns for staking can be attributed to several factors:

1. Nominated Proof-of-Stake (NPoS) Consensus Mechanism: Polkadot uses a Nominated Proof-of-Stake consensus mechanism, which allows token holders to nominate validators they trust. Validators are responsible for producing blocks and validating transactions. This system incentivizes token holders to participate in staking by earning rewards in the form of DOT tokens.

2. Incentives for Validators: Validators on the Polkadot network are rewarded for their services. They receive a portion of the transaction fees and the newly minted DOT tokens as block rewards. The competition among validators for these rewards encourages them to maintain a high level of performance and security.

3. Nominator Rewards: Individuals who stake their DOT tokens and nominate validators can also earn rewards. Nominators receive a share of the rewards earned by the validators they nominate. This further incentivizes participation in the staking ecosystem.

4. Staking Yield: The total staking yield in Polkadot depends on various factors, including the number of tokens staked, the inflation rate, and the percentage of tokens participating in staking. When more tokens are staked, the rewards are distributed among a smaller pool of stakers, potentially leading to higher individual rewards.

5. Governance and Governance Rewards: Polkadot's on-chain governance system allows token holders to vote on proposals and changes to the network. Those who actively participate in governance decisions may also earn additional rewards. This incentivizes token holders to engage with the network's development and decision-making processes.

6. Network Growth: Polkadot is a rapidly evolving ecosystem with various parachains (parallel blockchains) and projects being developed on its platform. As the network expands and attracts more users and developers, the demand for DOT tokens may increase, potentially driving up the token's price and staking rewards.

It's important to note that while the potential for high returns exists in Polkadot staking, it also comes with risks. Staking involves locking up your tokens for a period, and the rewards are subject to market volatility and network conditions. Additionally, there may be slashing penalties for validators who misbehave, which can affect staking rewards. Therefore, individuals considering staking in Polkadot or any other blockchain network should conduct thorough research, understand the risks, and consider their investment goals and risk tolerance.

Good luck. Is that 19% paid in token? If so how can you be assured you will be able to convert to fiat going forward when you need to pay with fiat?

[RafPinto]

4 minutes ago, mokwit said:

Thanks, hadn't realised buying low and selling high was that easy.

Heard already about average in.
I bought many times f ex my LGEN shares and am close to break even but collect the 8,xx and bank on lower inflation and that the BOE starts lowering interest rates again.
Analyst have a target price for LGEN between 280-335 pence.
Actually around 228 pence.

 

[mokwit]

1 minute ago, RafPinto said:

close to break even

So you actually have a loss?

 

1 minute ago, RafPinto said:

Analyst have a target price

Means nothing.

[placnx]

7 minutes ago, RafPinto said:

As far as I understand, you register the 30 years usufruct.
Not sure is that counts as a 30 year lease.

A usufruct isn't for a fixed number of years but rather for the life of the holder.

[RafPinto]

17 minutes ago, ThomasThBKK said:

Interesting, is there any more info about this, i mean the lease part? 

Would superficies or usufruct also apply? 

For freehold, copy of certificate of ownership of apartment/condo in applicant’s name (Or.Chor. 2) AND copy of the sale and purchase agreement of the condominium unit (Or.Chor. 16 or 23) issued by Department of Land. For leasehold, copy of leasehold agreement issued by Department of Land. For investment on other properties such as owning a villa or a land lease, kindly submit the official sale and purchase agreement which indicates the purchase value of the property OR/AND the land deed which has your name as the owner of the Usufruct property right or leaser

[ThomasThBKK]

3 minutes ago, placnx said:

A usufruct isn't for a fixed number of years but rather for the life of the holder.

30 year usufructs also exist and can be inherited, it's odd if they would accept a lease over 30 year but not something for lifetime tho

[RafPinto]

12 minutes ago, mokwit said:

So you actually have a loss?

 

Means nothing.

NO

Share price has to go up by 2,2%  (not including the re-investment of dividends) to break even but I collect the yearly dividend.

Hold them for 7 years already and am now on a 8,4 dividend.

If figuring in all dividends I reinvested, I am well well above.

You only lose when you sell.
For the moment it is a slight paper loss. If selling now, adding all money re-invested from dividends, I am over 60% up.

 

[RafPinto]

10 minutes ago, mokwit said:

So you actually have a loss?

 

Means nothing.

Means something to me as I can read company results with my background as an Economist.

[Neeranam]

16 minutes ago, mokwit said:

Good luck. Is that 19% paid in token? If so how can you be assured you will be able to convert to fiat going forward when you need to pay with fiat?

Thanks, been getting these rewards, in tokens for 3 years. Originally, from Kraken(a US bank) but I opted for the 12% for no fixed period as it was during a bull run. 

I convert to cash in various ways, one of which is using a crypto.com debit card. I can pay most of my utility bills, shopping etc. I have some at 12% still for instant access and some at 19% which is tied in for 1 month. 

 

[tomkenet]

What is the tax rate in Thailand on received overseas dividends? Will it be added to your personal income or is it a flat rate? What about financial gains , interest?

[kwilco]

17 hours ago, stat said:

You forgot that Germany has the top spot regarding tax rates, with the US and others being a distant competitor. For example if you trade options and future your tax rate can easily go over 100% in Germany, no joke! Top income tax starts at around 65000 USD and is 45%.

Uk and US Middle income actually end up with similar tax burdens.

European tax systems are just better organised.

In Germany Top rate is 45%

If you earn the median income, your income tax is around 18% of your income. The maximum income tax is 45% of your income.

[FritsSikkink]

1 hour ago, mokwit said:

Do you think that is sustainable?. Perhaps you can tell us HOW 19% that return is generated. Also WHY are they paying out that much when returns are lower elsewhere?

Ponzi scheme

[Lorry]

8 hours ago, ukrules said:

Lets say I borrow £250,000 which is currently valued at 11 Million Baht, it's definitely not income in any way shape or form, it's a debt.

 

I then take this loan and transfer it to Thailand to purchase something like a house

 

In this scenario would there be any tax liability under these 'clear as mud' rules when moving the funds into Thailand.

 

No tax has been paid on this money because it's debt.

 

This might be a novel idea to many but I can assure you it's a mechanism that's widely used around the world and for some very good reasons.......

 

Thoughts?

It's the way Mr Bankman, a Stanford tax professor,  got a nice villa from his son (paid in effect with customers' money).

He is being sued now. Not everybody is willing to "believe" these shenanigans.

 

It's all over the news

https://www.theguardian.com/business/2023/sep/19/ftx-sues-sam-bankman-fried-parents

[Arkady]

20 hours ago, Thaindrew said:

I can see them potential saying that you haven't declared enough money to live so how are you living as a way of taxing you above what you have declared as bringing in. That's fraught with danger given the way other government office like immigration deal with things.

 

I suppose as a minimum you'd have to bring in and declare at least 65000 baht x 12 a year as living expenses to match what they insist people on retirement visas bring in (ignoring agents in the whole process for now). But what would the tax be on 780,000 Baht, not small for sure !

I think it is fair to assume that they will do this in the not too distant future. They already demand evidence of tax payment of employee and company for renewal of NON-B visas from what I recall.  Also they may well raise the monthly amounts and lump sum.  Under the first Thaksin regime they were raised  substantially when he first came to power in 2001 (I think the lump sum was raised from 200k, so 4x).   If you have already been in the country long enough for file a tax return and pay tax, there would be a logic to this for sure.  Some double tax treaties allow the country of residence to collect tax and make the taxpayer try to claim a refund of tax already deducted in the other jurisdiction. Others will allow the taxpayer to claim a tax credit for tax already deducted in the country of origin. 

 

If you are earning the minimum required for renewal, currently 65k a month, you are way above the threshold that requires you to do a Thai tax return. So Immigration could easily ask for a certified copy of your prior year tax return.  The current forms have a space to declare foreign income but I don't think there is anywhere you can claim a tax credit under a foreign DTA.

[Lorry]

About DTA:

1. as I said earlier,  it will be a bureaucratic nightmare for you. Dogmatix has explained it.

2. Some have asked whether Thailand can breach a DTA. Yes, they can.

A DTA is a treaty between  2 sovereign states, and if one state doesn't adhere to the treaty,  the other state may take whatever action is deemed appropriate. 

An individual subject of one of these 2 states does not have the right to demand that it's government follow the treaty. 

 

Governments can and do openly breach treaties (including the DTA they have with Thailand).  Their subjects are not entitled to anything.  The other state is.

 

If Thailand breaches the  DTA with Gambia, Gambia can e.g. introduce economic sanctions,  like buying no more durian. Gambian citizens can do nothing about it.

[Dogmatix]

19 hours ago, Thorgal said:

From page 15:

 

My quote with my own wording : "As per another press release of the same subject this income tax change is only for Thai citizens (no need to thank me...)"

 

The coconut media doesn't refer to farangs as tax-residents. It mentions clearly Thai citizens.

I didn't change the quote of the newspaper...

 

I just wanted to warn people on our community that different versions of the Thai income tax changes (as OP) are confusing.

 

Quote from coconut media : "Thais earning income abroad and exploiting a well-known tax loophole are about to have their vibe killed by the country’s greatest party pooper: The government. A statement issued by the Revenue Department Friday announced that all money earned by Thai citizens must be taxed as personal income, effective January 1, 2024." 

 

It is hard to get to get to the bottom of this by only reading English language accounts on various websites.  If you look at the sources, the Revenue Department Order and the Revenue Code itself even in English translation, it is pretty obvious that that tax residence is the key and there is no difference in the way foreign and Thai tax residents are taxed.

[TroubleandGrumpy]

22 hours ago, freeworld said:

''If I bring over 5-10 million baht to buy a property, will the Thai Bank 'withhold' 30% as potential due tax?''

The thai bank will not tax it, why would they. Taxes are paid on income and taxes are managed by tax offices. For such a large amount the bank may ask questions and report it to the tax office. After that it is up to you and the tax office to prove that the income is savings and if the taxes have been paid if it was required.

That makes sense - but that does not mean that it will happen that way (TiT).

At the very least the Thai Govt will instruct the Thai Banks to ensure that they report all foreign sourced deposits (probably over an arbitrary amount) much more rigorously than they did in the past. But as I said, the Thai Govt may instruct the banks to be much more 'proactive' and to get involved in the process of identifying foreign deposits that may be subject to taxation under the revised interpretations from 1 Jan 2024. 

You could be right - I hope so - but there is no details yet provided either way, and it still does not mean I do not have potential tax issues in Thailand.

Until they clarify all the details (like this one), I am going to look for the potential problems and stay acropss the matter, and be open to all potential problems people mention - then when the time is right I will seek professional advice, before making my decision (leave or stay).

To me it is a game changer - if I have tax liabilities in Thailand on my private funds from supoerannuation investments in Australia being brought into Thailand, then we are out of here.

[Hepbub]

Completely confused now! The thread started off about the Thai government wanting to tax money coming into Thailand. Then it diverged into the long term visa, then into stocks and shares?????

 

If I pay income tax on my UK state pension, which is then paid into my UK bank, do I have to pay tax on money I transfer from that account to my account in Thailand? A fairly simple and straight forward question...I don't have any other income.

[TroubleandGrumpy]

Thailand Tax Rates - on total 'taxable income' from Jan 1 to Dec 31.

Taxable Income (Baht)         Tax rate %

1-150,000                                Exempt 

150,001-300,000                     5% 

300,001-500,000                     10% 

500,001-750,000                     15% 

750,001-1,000,000                  20% 

1,000,001-2,000,000               25% 

2,000,001-5,000,000              30% 

5,000,001 and over                35%

 

[stat]

1 hour ago, kwilco said:

Uk and US Middle income actually end up with similar tax burdens.

European tax systems are just better organised.

In Germany Top rate is 45%

If you earn the median income, your income tax is around 18% of your income. The maximum income tax is 45% of your income.

In Germany the top top rate is 50,5 if you count in solidarity surcharge and "Reichensteuer". In Germany the "normal" top tax rate (45%) starts at 65K USD whereas in the US it starts at 283K. Every comparision shows that Germany and Belgium top the tax charts. FYI

 

https://data.oecd.org/tax/tax-wedge.htm

 

Germany tax wedge 50,5%! US 30%! for average earner. If you are "rich" you are much better off in the US then in Germany.

Tax wedge is defined as differnece what the company has to pay in relation to what you get after taxes and social contributions. Granted social security is "better" in Germany then in the US.

I hope you can agree to the simple facts by an neutral organisation.

[Ricardo]

3 hours ago, Mike Teavee said:

I was talking about the tax free lump sum that you can take when you start taking your Private (in my case Defined Benefits/Final Salary) Pension which can be up to 25% of the value of the pension.

 

State pension does count towards your personal taxation allowance and so any additional taxable income can take you over your PTA & you would be liable to tax on the excess.

OK, Thanks for the explanation, I see what you're getting at now.

 

Might I suggest, since your OAA doesn't start until your 66+, you might find it possible to take the 25% tax-free from your private-pension, plus any further unused personal-allowance in your 65th year ?  

 

I missed that, and could have drawn over 30% tax-free immediately, in exchange for a slightly-lower annuity thereafter.  

[stat]

6 hours ago, whiteman said:

as I said b4 it is looking more like a lot of lump sums will be coming into Thailand just b4 the 1st of Jan to get around the new rules.  To get one at least the next few years worry free

Apparently you forgot the proposed wealth tax...

https://www.nationthailand.com/thailand/policies/40028162

[TroubleandGrumpy]

Personal Income Tax | The Revenue Department (English Site) (rd.go.th)

1.Taxable Person

Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.

 

This below is the 'big one' and what worries me because of 'Thai Interpretation' by Thai Government Employees of the Rules and Regulations (example - Immigration Officers from Provice to Province).

 

Assessable income is divided into 8 categories as follows :

1. income from personal services rendered to employers;
2. income by virtue of jobs, positions or services rendered;
3. income from goodwill, copyright, franchise, other rights, annuity or income in the nature of yearly payments derived from a will or any other juristic Act or judgment of the Court;
4. income in the nature of dividends, interest on deposits with banks in Thailand, shares of profits or other benefits from a juristic company, juristic partnership, or mutual fund, payments received as a result of the reduction of capital, a bonus, an increased capital holdings, gains from amalgamation, acquisition or dissolution of juristic companies or partnerships, and gains from transferring of shares or partnership holdings;
5. income from letting of property and from breaches of contracts, installment sales or hire-purchase contracts;
6. income from liberal professions;
7. income from construction and other contracts of work;
8. income from business, commerce, agriculture, industry, transport or any other activity not specified earlier.

 

I cannot find anything on the Thai Revenue Department website that specifically covers foreign sourced funds, and when they are or are not assessable income.

 

Until the Thai Govt clearly states that the funds I bring into Thailand from my personal savings/investments in Australia are not subject to their taxation obligations, because they were already taxed or tax exempt in Australia, then this is a problem that I need to plan for going ahead as an Expat living in Thailand.  It would be impossible for me to prove, to the satisfacytion of an arrogant Thai Revenue Officer who is being poushed to 'get more money', that my super fund has taxed my earnings - the taxes are paid across the whole fund, not at the individual account level.