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

[clearance]

So, for example, if I'm a foreigner who lives in Thailand on an Elite visa. In 2024 I'm planning to buy a house or apartment there. I will transfer money from my savings abroad. And they will tax me for 35%?

 

[pluto_manibo]

3 minutes ago, clearance said:

So, for example, if I'm a foreigner who lives in Thailand on an Elite visa. In 2024 I'm planning to buy a house or apartment there. I will transfer money from my savings abroad. And they will tax me for 35%?

 

Yes, you will pay 0% from 0-150k, 5% from 150k-300k(Baht7500),10% from300k-500k(Baht20,000),15% from 500k-750k(Baht37,500),20% from750k-1 million(Baht50,000),25% from 1million-2million, 30% from 2 million-5million and 35% on anything over 5Million. This is what we know so far.

[Gknrd]

I am already taxed 10% on my dividends from the country where I own the stocks. It is deducted every time I get a dividend from the country. Also I am taxed on the dividends in the US. So, I assume if I bring that money over from the US then I will not be taxed again?

[JimGant]

3 hours ago, jaideedave said:

And you know that any US expats that have  more than 10K USD in Thai Baht in a Thai bank, The bank reports that to the IRS as well. 

Actually, the FATCA reporting threshold is $50K for bank reporting requirements; 10K is the FBAR threshold for individual reporting requirement. Sounds like there's something afoot in Congress about matching FBAR to the FATCA $50K threshold. Since Congress only elects idiots these days, can't see much happening with this ... not until Hunter Biden is tar and feathered.

[JimGant]

44 minutes ago, clearance said:

So, for example, if I'm a foreigner who lives in Thailand on an Elite visa. In 2024 I'm planning to buy a house or apartment there. I will transfer money from my savings abroad. And they will tax me for 35%?

Doubtful. There's no way they can parse a cash flow into Thailand, especially if its from a savings, checking, or credit union account -- to determine what's income and what's principal. The holdings in my savings account, from where my SWIFT, Wise and ATM transfers occur, has my after tax withholding direct deposits from my Air Force retirement; Social Security; and IRA RMD annual payment. Only my annual reinvested interest is not after tax payment (withholding). But, if we're going FIFO for my wire transfers, last year's interest shows up as taxed on my IRS 1040 tax return.

 

Anyway, if I send a load of cash to Thailand from the account mentioned above, there's no way the Thai RD folks could parse what's what for income tax purposes. Stupid if they even tried. And for those arguing about ATM remittances, since these come from the same kind of accounts I'm talking about here -- same argument.

 

So, it will be interesting to see how cash flow remittances into Thailand will be scrutinized to determine what's income taxable by Thailand -- and what's not. That's where this whole new drill breaks down. Best option is to just concentrate on income earned abroad, and identified with the new CRS, or equivalent, data reporting systems. Forget remittance.

Edited September 21, 2023 by JimGant

[lordgrinz]

1 hour ago, Madgee said:

Your Pink ID card has your name in English on it? ...... How unique.
Not one word of English on mine! 

I had to double check myself, oops! Yes, you are right, only Thai name on Pink ID.

[lordgrinz]

1 hour ago, transam said:

No English on mine...................????

Yup, my mistake ???? I assume they translate it themselves.....when entering English, Google gets the reverse translation right at least.

Edited September 21, 2023 by lordgrinz

[Dogmatix]

2 hours ago, Gknrd said:

I am already taxed 10% on my dividends from the country where I own the stocks. It is deducted every time I get a dividend from the country. Also I am taxed on the dividends in the US. So, I assume if I bring that money over from the US then I will not be taxed again?

According to what little they have said so far, you could take a tax credit for the 10% tax already paid, if your country has a double tax agreement with Thailand.  Then, depending on what is your top marginal rate of Thai tax, you might have to pay some more tax, since foreign dividends are taxable as normal income at rates ranging from 0 to 35% 

[Dogmatix]

1 hour ago, JimGant said:

Doubtful. There's no way they can parse a cash flow into Thailand, especially if its from a savings, checking, or credit union account -- to determine what's income and what's principal. The holdings in my savings account, from where my SWIFT, Wise and ATM transfers occur, has my after tax withholding direct deposits from my Air Force retirement; Social Security; and IRA RMD annual payment. Only my annual reinvested interest is not after tax payment (withholding). But, if we're going FIFO for my wire transfers, last year's interest shows up as taxed on my IRS 1040 tax return.

 

Anyway, if I send a load of cash to Thailand from the account mentioned above, there's no way the Thai RD folks could parse what's what for income tax purposes. Stupid if they even tried. And for those arguing about ATM remittances, since these come from the same kind of accounts I'm talking about here -- same argument.

 

So, it will be interesting to see how cash flow remittances into Thailand will be scrutinized to determine what's income taxable by Thailand -- and what's not. That's where this whole new drill breaks down. Best option is to just concentrate on income earned abroad, and identified with the new CRS, or equivalent, data reporting systems. Forget remittance.

It will not be a case of just waiting to see how they classify your overseas income when you remit some money in.  You will be required to classify it yourself and file a tax return accordingly. They may or may not investigate you and demand documentary evidence but they can and do go back many years.  When they decide to do a random inspection, they work hard to try to find a reason to charge back tax, interest and penalties to make it worth their while.  Don't ask me how I know this.

[Social Media]

Reported abusive post and response to it removed.

[clearance]

2 hours ago, JimGant said:

Doubtful. There's no way they can parse a cash flow into Thailand, especially if its from a savings, checking, or credit union account -- to determine what's income and what's principal. The holdings in my savings account, from where my SWIFT, Wise and ATM transfers occur, has my after tax withholding direct deposits from my Air Force retirement; Social Security; and IRA RMD annual payment. Only my annual reinvested interest is not after tax payment (withholding). But, if we're going FIFO for my wire transfers, last year's interest shows up as taxed on my IRS 1040 tax return.

 

They can just tax everything, and do tax returns when you confirm that money is already taxed in another country (if that country have a treaty with Thailand).

[Skeptic7]

4 hours ago, transam said:

But, it could all be required at extension time, with another zillion sheets of A4.........????

True dat POTY❗Good point. And wouldn't surprise us a bit. Time will tell. 

[asean]

It is impossible to impose income tax on "net-tax funds" transfers into Thailand.....

If they did that it would be called a very heavy incoming funds transfer tax... which needs to apply across the board..

 

Example John and Mary Smith sell their primary residence townhouse in Manchester for a 20m baht tax free capital gain and bring in 10m baht to buy a 30 year lease house in Thailand.... is Thailand going to treat that as income and tax it?

 

There is only half the law announced so far.

[thaibreaker]

9 hours ago, Geir Rasch said:

You obviously don’t understand much about tax, and you have some reading issues. I never said there is no 180 days rule, I wrote there is no 183 days rule. Do you see the difference?
Thai tax is like norwegian tax, progressiv. There is also deduction for age, care of children and also for wife if she does not have income. If you are single and 65 years old or older, only income over 500k will be taxed. 
To get as low as 1,7% tax in Norway means that you are not voluntary member of nav.
If your income is 65k a month and you are singlr, do not have other deduction than age, your average tax to Thailand would be app. 2,6%.

A better link for you here. Updated, and it shows 0 percent taxes up to 250.000 NOK pension, for 2023.

65.000 baht a month should equal around 235.000 NOK a year.

 

That's my reality, as well as others with similar income, for me by choice (from 62 years old). 

Thailand can't compete with that. 

 

https://www.smartepenger.no/skatt/1905-skatteprosent-pa-pensjonsinntekt

Edited September 21, 2023 by thaibreaker

[redwood1]

To tax all money that comes into Thailand would be the end of Thailand....Might as well just carpet bomb the place with nukes and get the distruction over with...

 

To make a Huge announcement  like this with no details is hilarious,,

 

This tax nonsese is not going to happen ever......They could never pull it off....  

Edited September 21, 2023 by redwood1

[thaibreaker]

12 hours ago, Geir Rasch said:

You obviously don’t understand much about tax, and you have some reading issues. I never said there is no 180 days rule, I wrote there is no 183 days rule. Do you see the difference?
Thai tax is like norwegian tax, progressiv. There is also deduction for age, care of children and also for wife if she does not have income. If you are single and 65 years old or older, only income over 500k will be taxed. 
To get as low as 1,7% tax in Norway means that you are not voluntary member of nav.
If your income is 65k a month and you are singlr, do not have other deduction than age, your average tax to Thailand would be app. 2,6%.

Lol. It's you who don't know about taxes for lower income in Norway. Get down from your high horse, and read up. Start with the link above. It's never too late to learn something.

 

In fact, a 65.000 baht pension income in Norway, equals to about 235.000 NOK. After all normal deductions everyone get is made, that will equal to zero tax in Norway. Zero.

Of course I'm a "member" of Nav. I live in Norway.

 

In Thailand I will have to pay taxes from that, based on the same numbers and deductions. I'm not even 65, and don't get the 190.000 baht deduction.

That is, if this change will be forced upon us, which so far it hasn't. 

 

That 180/183 issue you are trying to make a number of, seriously.. It was a typo. And you jumped all over it. Don't be that guy, fellow Norwegian.

Edited September 21, 2023 by thaibreaker

[jonny on the spot]

7 hours ago, Dogmatix said:

It will not be a case of just waiting to see how they classify your overseas income when you remit some money in.  You will be required to classify it yourself and file a tax return accordingly. They may or may not investigate you and demand documentary evidence but they can and do go back many years.  When they decide to do a random inspection, they work hard to try to find a reason to charge back tax, interest and penalties to make it worth their while.  Don't ask me how I know this.

Is that your friends opinion or something set in stone? My experience of these people is when they cant do the job very well or just cant be bothered they ask for a rain forrest worth of translated A4. But some how i am always 1 document short. Thats just for mundane issues.

I truly dread seeing the dogs dinner this will become, every office own criteria for what is acceptable proof yada yada yada.

 

I got a sinking feeling its hello London for us for 6 months of the year starting next June ????

[Mike Teavee]

7 hours ago, Dogmatix said:

According to what little they have said so far, you could take a tax credit for the 10% tax already paid, if your country has a double tax agreement with Thailand.  Then, depending on what is your top marginal rate of Thai tax, you might have to pay some more tax, since foreign dividends are taxable as normal income at rates ranging from 0 to 35% 

If we're talking about the 10/11% Withholding tax paid on Dividends in the UK then you (as an Individual) cannot claim a Tax Credit for this, and in reality you haven't paid it [Do the calculation on declared dividend x #Shares you'll find you haven't paid any Tax]... This "Tax Credit" is for the Company to offset the dividend against it's profits when calculating it's Corporation Tax, but it does come into play as a Non-UK Resident when it comes to the dividend being treated as "Excluded Income" as this should be the only Tax that you need to "Pay" & so no further Tax is due.

 

If Thailand were to start Taxing Dividend Income being brought into the country from any previous Tax Year then it would be very costly & a nightmare to calculate for me as I typically re-invest the Dividend & only bring the cash in when I sell the asset at some point a few years later, by which time it has generated it's own Dividends which have been reinvested, sometimes back into the same stock which then has generated it's own dividends.... etc...  ????

 

 

If you did need to pay additional Tax on any (Non-ISA) Dividend income that takes you over your allowances of £13,570 (£12,570 Personal Taxation Allowance + £1,000 Dividend Allowance), then you will pay tax on this at a rate of :-

   - 8.75% Basic Rate (£13,570 - £37,700)

   - 33.75% Higher Rate (£37,701 - £150,000) 

   - 39.35% Additional Rate (> £150,001) 

 

You should be able to offset any of this additional Tax against any further Tax that Thailand applies (Will be treated as Income so 0-35%) if you bring the money across.

 

Edited September 21, 2023 by Mike Teavee

[jonny on the spot]

4 hours ago, redwood1 said:

To tax all money that comes into Thailand would be the end of Thailand....Might as well just carpet bomb the place with nukes and get the distruction over with...

 

To make a Huge announcement  like this with no details is hilarious,,

 

This tax nonsese is not going to happen ever......They could never pull it off....  

I hope you are right but these people have a bad habit of knee jerk ideas that end up as broken, long winded, repetitive and overly complicated systems, i am more scared of that than something that functions properly.

 

Look at the other breaking news, the great 10,000 baht give away. I am struggling to see how giving every yaba enhanced, low cow soaked village idiot !0,000 baht is going to stimulate anything.

They will buy whatever they are buying at retail, sell it half price and all from the comfort of 4km from their wooden hut.

Another well thought out plan that looks like becoming a reality.

 

Edited September 21, 2023 by jonny on the spot

[Dogmatix]

6 hours ago, asean said:

It is impossible to impose income tax on "net-tax funds" transfers into Thailand.....

If they did that it would be called a very heavy incoming funds transfer tax... which needs to apply across the board..

 

Example John and Mary Smith sell their primary residence townhouse in Manchester for a 20m baht tax free capital gain and bring in 10m baht to buy a 30 year lease house in Thailand.... is Thailand going to treat that as income and tax it?

 

There is only half the law announced so far.

That’s a great example. Assuming they had already become Thai tax residents in the tax year they remitted the funds, John and Mary need to file a PNG 90 tax return for that year. If we assume the 10m they remit is from the profit, then that, as income from the sale of overseas immovable property, that is fully taxable in Thailand and they have no tax credit to apply because they didn’t pay UK tax on the gain. They will get the standard Thai tax allowances but their high income for the year will likely push them into the top marginal tax rate of 35%. Most likely any of the original principle used to buy the house would be lumped in as taxable income too because there is no clear way to separate it out.

 

UK gives full tax break for sale of primary residence but TH does not. Thai tax on sale of property by individuals is calculated on a purely transactional basis on the total sales price according to a slightly complex formula based on how many years held without reference to your other income or top marginal tax rate. This rarely works out at more than 5% of the sales price with room for cheating if the sales price is less than the govt appraisal price. But this only applies to Thai property transacted at the Land Dept.

 

Conclusion. John and Mary decide not to buy the 30 year lease which structurally is a poor investment anyway. They continue renting in Thailand and transfer their capital gains in smaller annual portions incurring lower marginal tax rates.  The numbers would probably look better if they took separate remittances and each filed their own tax returns rather than as a married couple. To file as a married couple they will need to submit a certified translation of their marriage translation certificate further notarized by the Foreign Ministry anyway.

[jonny on the spot]

6 minutes ago, Dogmatix said:

That’s a great example. Assuming they had already become Thai tax residents in the tax year they remitted the funds, John and Mary need to file a PNG 90 tax return for that year. If we assume the 10m they remit is from the profit, then that, as income from the sale of overseas immovable property, that is fully taxable in Thailand and they have no tax credit to apply because they didn’t pay UK tax on the gain. They will get the standard Thai tax allowances but their high income for the year will likely push them into the top marginal tax rate of 35%. Most likely any of the original principle used to buy the house would be lumped in as taxable income too because there is no clear way to separate it out.

 

UK gives full tax break for sale of primary residence but TH does not. Thai tax on sale of property by individuals is calculated on a purely transactional basis on the total sales price according to a slightly complex formula based on how many years held without reference to your other income or top marginal tax rate. This rarely works out at more than 5% of the sales price with room for cheating if the sales price is less than the govt appraisal price. But this only applies to Thai property transacted at the Land Dept.

 

Conclusion. John and Mary decide not to buy the 30 year lease which structurally is a poor investment anyway. They continue renting in Thailand and transfer their capital gains in smaller annual portions incurring lower marginal tax rates.  The numbers would probably look better if they took separate remittances and each filed their own tax returns rather than as a married couple. To file as a married couple they will need to submit a certified translation of their marriage translation certificate further notarized by the Foreign Ministry anyway.

Well said. That is one depressing state of affairs.

[Dogmatix]

The truth is that none of the complexities have even been thought of. The law exists to charge tax on overseas income but it has not been applied because no one ever admitted to transferring income in the year it was earned. There is not even a space on the tax returns to enter tax credits from DTA countries and will apply to Thai overseas stock traders too because they get withholding tax deducted from dividends in many countries too.

 

This is just a work in progress from the RD that went up to Srettha as finance minister for approval while he was packing his bag to get on his million dollar flight with his daughter. Under pressure to fund the digital wallet fiasco, he said yes what a great idea and left for the airport.

[jonny on the spot]

1 minute ago, Dogmatix said:

The truth is that none of the complexities have even been thought of. The law exists to charge tax on overseas income but it has not been applied because no one ever admitted to transferring income in the year it was earned. There is not even a space on the tax returns to enter tax credits from DTA countries and will apply to Thai overseas stock traders too because they get withholding tax deducted from dividends in many countries too.

 

This is just a work in progress from the RD that went up to Srettha as finance minister for approval while he was packing his bag to get on his million dollar flight with his daughter. Under pressure to fund the digital wallet fiasco, he said yes what a great idea and left for the airport.

In true Thai style, trouble is now he has said it also in true Thai style we got the problem of losing face with a reversal.

These people might actually try this, turn it into a dogs dinner but never mind.

I can just see me pulling out my last 3 hairs on my seventeenth trip to the tax office, with an unresolved tax issue which will eventually end up with me paying just to stop the frustration.

It just aint that good here any more.

[quake]

7 minutes ago, jonny on the spot said:

In true Thai style, trouble is now he has said it also in true Thai style we got the problem of losing face with a reversal.

These people might actually try this, turn it into a dogs dinner but never mind.

Would be funny if they backed down and let the Thais off.

by just carrying on as usual.

But they went after foreigner's instead.

Face saved.

What a laugh that would be. 

TIT, anything can happen. 

 

[jonny on the spot]

5 minutes ago, quake said:

Would be funny if they backed down and let the Thais off.

by just carrying on as usual.

But they went after foreigner's instead.

Face saved.

What a laugh that would be. 

TIT, anything can happen. 

 

Yea, thats another possibility 

[Darren8888]

16 hours ago, El Matador said:

The tax dividend in Thailand is 10%. If you already paid a withhold tax of 15% to the USA on the dividends from US stocks, basically you won't pay any extra Thai tax on your dividend and you will be able to deduct the extra 5% on your Thai income.

Can be interesting if you have some income in Thailand. But the new law won't change anything. It was already better to remit your dividend income the same year to get extra deduction on your Thai income.

 

Those who have special saving plans with no withhold tax on their dividends might need to pay the 10% to the Thai system as they can't make any deduction and those exceptions are usually never included in Tax Treaties.

Thailand dividend tax rate is not a flat rate of 10% ???? that is only withholding rate at the time of distribution. Your effective dividend tax rate will be whatever your highest tax rate will be. in most cases, you would ending up paying 35% in dividend tax since Thailand income tax is very high compared to western countries (their 35% tax income rate starts at super small threshold of USD 120k which is a joke, it should be at least USD 500k for that kind of tax rate). 

Edited September 22, 2023 by Darren8888

[JimTripper]

7 hours ago, redwood1 said:

To tax all money that comes into Thailand would be the end of Thailand....Might as well just carpet bomb the place with nukes and get the distruction over with...

 

To make a Huge announcement  like this with no details is hilarious,,

 

This tax nonsese is not going to happen ever......They could never pull it off....  

Hello, Do you have 3 legs? Do you walk on all 3, or just two? Would you be interested in walking on all 3 of your legs?

[kkjjhhss]

You must LEARN, "Individual" VS "Corporate"  Except American

※American people must pay tax in USA no matter where they live.

 

Conditions: You live in Thailand over 180/183 days with VIsa like ThailandElite Visa, Retirement Visa.

From 1, January, 2024

????Individual：If you bring all money into Thailand, you must pay Individual Income.

Of course, because of Tax Treaty, Farang doesnt need to pay Tax in Thai if they pay it in your home country. Even elementary kids know that, HOWEVER, for example, if you live in Thailand over 180/183 days and earn 10 million Bahts by crypt through Binance or  Bybit (Offshore) , then that money goes to offshore bank account (except individual account in Thailand and your home country), you don't need to pay Tax in Thailand. However, you cannot live in Thailand unless you send your living expenses to Thailand. In Thailand, you can probably live on 40,000 baht a month. So, you send about 500,000 baht a year to Thailand for living expenses. In that case, the income tax in Thailand is only 10,000 baht. The remaining 9.5 million baht obtained in crypt will be kept in a personal offshore account. By doing so, not only will you not be taxed in your home country, but your income tax in Thailand will only be 10,000 baht. I think this is the BEST individual option for Crypt.

However, If you are "individual" digital nomad living in Thailand and doing business online, all profits will be paid in Thailand. This is because you are living and working in the "land" of Thailand, so it is considered "source income within Thailand" rather than income sourced outside Thailand.

VS

????Corporate (Offshore Company)：If you manage offshore company, and have a offshore bank account, profit goes to the offshore corporate bank account. The company will then transfer the dividend to your personal account every month. Of course, an offshore corporation is a tax haven country where all taxes such as corporate tax and income tax are not levied.

In this case, it is not sourced income in Thailand, but income sourced outside Thailand. From Thailand's perspective, offshore corporations exist overseas. For example, if your Annual profit is $200,000 and your personal dividends are $200,000（ex no costs for online consulting), and $14,000 (approximately 500,000 baht) will be remitted to Thailand. Then, the income tax in Thailand will be only 10,000 baht. The remaining $186,000 is tax-free. Of course, since you live in Thailand and are a tax resident of Thailand, there are no taxes due in your home country. Addition, in Thailand, the income tax is only 10,000 baht.

 

This is a Tax Saving Scheme using

Thailand Elite or Thai retirement visa＋Offshore corporation＋Offshore corporate account.

Edited September 22, 2023 by kkjjhhss

[Dogmatix]

6 hours ago, jonny on the spot said:

Is that your friends opinion or something set in stone? My experience of these people is when they cant do the job very well or just cant be bothered they ask for a rain forrest worth of translated A4. But some how i am always 1 document short. Thats just for mundane issues.

I truly dread seeing the dogs dinner this will become, every office own criteria for what is acceptable proof yada yada yada.

 

I got a sinking feeling its hello London for us for 6 months of the year starting next June ????

That is what the procedure according to the Revenue Code, no part of which has been amended.  This is just a reinterpretation of one word in Section 41 with the meaning changed by a malevolent stretch of the imagination from "the previous tax year" to "any previous tax year". Under the Revenue Code any tax resident with taxable income from overseas has to declare it himself in a PNG 90 tax return. Passive tax returns, where everything is worked out for the tax payer can be done via PNG 91 but that is only applicable to salary earned in Thailand which is calculated by the employer.  If you are a Thai salary earner and don't wish to claim any of your personal allowances, you can just leave it at that.  All other types of taxable income, you have to decide for yourself and declare it.  If they don't agree, they can charge you back taxes, interest and penalty many years later.

 

So no.  You are not going to get a letter from the RD saying that, based on the inward remittances you received during the tax year, you owe XXX baht in tax calculated by them.

Edited September 22, 2023 by Dogmatix

[Dogmatix]

4 hours ago, jonny on the spot said:

In true Thai style, trouble is now he has said it also in true Thai style we got the problem of losing face with a reversal.

These people might actually try this, turn it into a dogs dinner but never mind.

I can just see me pulling out my last 3 hairs on my seventeenth trip to the tax office, with an unresolved tax issue which will eventually end up with me paying just to stop the frustration.

It just aint that good here any more.

Of all the groups affected the real estate developers will have the most impact on Srettha for obvious reasons.  He is not going to care about expats because there are already exemptions for Elite and LTR visas and these are the only retirees they want.  The Thai stock traders are one of the target groups.  So they won't get any quarter.  

 

I can see an exemption for funds remitted by foreigners to buy condos or long leases transferred at the Land Department in the name of the foreign, i.e. not Thai wives' names.  There would be follow up to ensure the property was purchased and might be a minimum holding period of say 5 years like the LTFs and RMFs where you have to pay the tax saved, if you sell early, to prevent people bringing in a boatload of cash for a luxury condo and then flipping, paying only about 5% in tax instead 30-35%  This would take some time to draft and legislate.  So it might come after the new rule has taken effect puttin the market in limbo for a year or two.