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

[The Cyclist]

Just now, KhunLA said:

People need to simply add their country to the below & google:

 

EX: "USA taxation convention with Thailand"

 

For Yanks & USA, Article 20 will interest you, if receiving Social Security.

 

 

Excerpts from both the US and UK DTA have been posted. Makes no difference to the sky is falling in crew.

 

They are all mates of Ekniti Nitithanprapas, have coffee with him on a daily basis and he fills them in on whats happening 😂😂

[bamnutsak]

51 minutes ago, KhunLA said:

For Yanks & USA, Article 20 will interest you, if receiving Social Security.

 

Thanks for this.

 

 

Regarding Annuities...

 

Article 20 says: Annuities derived and beneficially owned by a resident of a Contracting State shall be taxable only in that State.

 

While the terms are defined in Article 3: "a Contracting State" and "the other Contracting State" mean the United States or Thailand, as the context requires;

 

 

 

If my Annuity is derived in the U.S., is that the Contracting State? Or is Thailand the Contracting State?

 

 

 

I infer that Social Security is taxable only in the U.S.? And not taxable in Thailand? Is that correct?

 

Notwithstanding the provisions of paragraph 1, social security benefits and other similar public pensions paid by a Contracting State to a resident of the other Contracting State or a citizen of the United States shall be taxable only in the first-mentioned State.

 

 

[Dogmatix]

19 hours ago, The Cyclist said:

 

What is the purpose of a DTA, and by extension, specific items covered in the DTA ?
 

 

UK State Pension have been covered repeatedly, as has Government Pensions.

 

Just for a laugh, lets play the doom and gloom game, even though the UK State Pension is not specifically  covered by the DTA, who says Thailand is going to tax UK State Pensions ?
 

Do you have written confirmation from the DTA headshed ?
 

After all, if they can decide to tax rental income ( tax paid in the UK ) they can also decide not to tax UK State Pensions, if they so choose.

 

Yet again I have to repeat myself. Best wait until the DTA confirms what exactly comes under assessable income, before getting knickers twisted and doing yourself damage.

The purpose of a DTA is to prevent double taxation. That can be interpreted as we tax this and you don't touch it, or it can be that you tax it first and and, if our tax rate is more, we'll take the difference. The latter is what happens to Americans working overseas.  If the US tax rate is more, Uncle Sam will have the difference.  So why not Thailand?

[The Cyclist]

40 minutes ago, Dogmatix said:

The purpose of a DTA is to prevent double taxation.

 

Thank you. That was all I wanted to know.

 

I don't really need if's, could's or might's  thrown in.

Edited October 24, 2023 by The Cyclist
typo

[noobexpat]

1 minute ago, The Cyclist said:

 

Thank you. That was all I wanted to know.

 

I don't really need would"s, could's or might's thrown in.

 

Actually the purpose of a DTA is to establish who has taxing rights.

[noobexpat]

43 minutes ago, Dogmatix said:

The purpose of a DTA is to prevent double taxation.

 

Thats hopefully the end result, but its not their actual purpose. At the back of them, its says that both countries are open to a complaints/mediation procedure (in the event that both feel they have the right to tax).

[KhunLA]

1 hour ago, bamnutsak said:

If my Annuity is derived in the U.S., is that the Contracting State? Or is Thailand the Contracting State?

 

I infer that Social Security is taxable only in the U.S.? And not taxable in Thailand? Is that correct?

Yes, I read both of those as non taxable by TH.

 

1 hour ago, Dogmatix said:

The purpose of a DTA is to prevent double taxation. That can be interpreted as we tax this and you don't touch it, or it can be that you tax it first and and, if our tax rate is more, we'll take the difference. The latter is what happens to Americans working overseas.  If the US tax rate is more, Uncle Sam will have the difference.  So why not Thailand?

That would be income, and taxable, whether by which, don't know, or care.

 

USA Soc Sec is specific in the convention, and taxed only in the USA.  It comes into to TH, designated from Fed Reserve as SS on TH banks Credit Advice, so non taxable by TH.

 

READ THE CONVENTION LINKD ABOVE

[huberthammer]

On 10/17/2023 at 10:33 AM, bugger bognor said:

I predicted a 100 pages of <deleted>e and I was right I'm now predicting 200 pages by December it's comical to me I will say it again 99.9 % Of expats won't be paying any tax none! You are deluded if you think any different it will take years or even a decade to produce legislation to implement a complex minefield of regulations globally tens of thousands of documents would have to be drawn up, so far 2 paragraphs by an advisory board has got you in a frenzy nothing is going to change just like your weekly pledge to stop drinking or bargirl hunting so get over it and back on the piss

let's assume it will take 10 years and as part of their random choice they pick you do see how your tax situation is and they present you with the bill for taxes which in their opinion you had not paid for the last 10 year. you might be in a proper frenzy. even worse when they tell you that they freeze your assets because they don't agree with your assessment that you are part of the 99.9% who should not pay tax.  It will be nice to live a happy life for 10 years and be deluded that this has nothing to do with you. however, the day of reckoning will come. I have heard and seen it before in so called developed countries and i have no doubt it will end in the similar tears here.

 

 

 

[burner2014]

Crazy that we are now at 119 pages 😄 this topic is quite important for a lot of people here.

 

[hotandsticky]

1 minute ago, huberthammer said:

let's assume it will take 10 years and as part of their random choice they pick you do see how your tax situation is and they present you with the bill for taxes which in their opinion you had not paid for the last 10 year. you might be in a proper frenzy. even worse when they tell you that they freeze your assets because they don't agree with your assessment that you are part of the 99.9% who should not pay tax.  It will be nice to live a happy life for 10 years and be deluded that this has nothing to do with you. however, the day of reckoning will come. I have heard and seen it before in so called developed countries and i have no doubt it will end in the similar tears here.

 

 

 

 

 

Nope...... I am still not scared.

[Des1]

5 hours ago, JimTripper said:

 

another great guess!

While there are certainly many questions about this taxation issue, taking the time to research the tax treaties and providing that information, does not constitute a “guess”.

[redwood1]

4 minutes ago, burner2014 said:

Crazy that we are now at 119 pages 😄 this topic is quite important for a lot of people here.

 

 

And the Thais can't be azzed to say any more about things than ONE whopping press release.....lol

 

A simple thing as buying a useless sub took 6 years before they scraped it....This tax thing is hugely massively more complex than buying a sub....

So forget the tax....It will never happen...

[Guavaman]

2 hours ago, bamnutsak said:

Regarding Annuities...

 

Article 20 says: Annuities derived and beneficially owned by a resident of a Contracting State shall be taxable only in that State.

 

While the terms are defined in Article 3: "a Contracting State" and "the other Contracting State" mean the United States or Thailand, as the context requires;

 

If my Annuity is derived in the U.S., is that the Contracting State? Or is Thailand the Contracting State?

Legal language:  The key word here is resident, so if the owner who derives benefits from the annuity resides in a Contracting State (either the US or Thailand), the annuity is taxable only in that State (where s/he is a tax resident).

[Puccini]

11 hours ago, paddypower said:

if things go sour, hope you're young enough to move. or go NR. we're on Retirement visa extensions since 1996, so a bit over the hill to consider going NR.

NR? What is that?

[JimTripper]

13 hours ago, paddypower said:

if things go sour, hope you're young enough to move. or go NR. we're on Retirement visa extensions since 1996, so a bit over the hill to consider going NR.

 

why? just get a hotel and look for a new place. unless you are mobility impaired it does not really matter how old you are. if you're just of moving i can understand that, but that can happen at any age.

[JRG23]

Looking for new information about this... Has the government issued any new information following the initial announcements? 

[Mike Lister]

2 minutes ago, JRG23 said:

Looking for new information about this... Has the government issued any new information following the initial announcements? 

No, and it is likely to be a while.

[Karma80]

41 minutes ago, JRG23 said:

Looking for new information about this... Has the government issued any new information following the initial announcements? 

None. Hence the speculation. It's one thing to send out a memo; it's quite another to change the law or obtain a ruling in the tax court. In typical Thai style, we could end up with nothing being clarified and things just being a mess for a couple of years as the waters get tested. Shame really. Thailand was the beneficiary of a lot of money which will stay offshore, and not just from expats.

[bamnutsak]

12 hours ago, Guavaman said:

Legal language:  The key word here is resident, so if the owner who derives benefits from the annuity resides in a Contracting State (either the US or Thailand), the annuity is taxable only in that State (where s/he is a tax resident).

 

Thanks.

 

Would the annuity need to be remitted to Thailand in order to be assessable income?

 

 

[Lorry]

3 hours ago, JRG23 said:

Looking for new information about this... Has the government issued any new information following the initial announcements? 

No. 

Guavaman has posted British rules of remittance-based taxation,  a couple of pages up.

Someone else mentioned that Japan also has remittance-based taxation, but I have no idea of their rules. 

 

The British rules make an interesting read. Most ideas to avoid taxes mentioned in this thread wouldn't be acceptable in Britain. Unfortunately,  the Thai ruling class is very familiar with Britain (and Japan). 

Of course,  many things described in the British rules are hard to prove,  even in Britain.  But tax evasion hoping that the facts will not come to light is very dangerous. What they cannot prove now, maybe they can prove in 7 years? Remember Al Capone.

[Yumthai]

19 minutes ago, Lorry said:

Remember Al Capone.

 

If Al Capone was Thai Capone and things had happened in Thailand at that time, I suspect he will have never been to jail enjoying an easy and long life.

 

[TheAppletons]

12 hours ago, Yumthai said:

 

If Al Capone was Thai Capone and things had happened in Thailand at that time, I suspect he will have never been to jail enjoying an easy and long life.

 

 

  If Al Capone was Thai Capone he would have been made Prime Minister.

[paddypower]

14 hours ago, Puccini said:

NR? What is that?

non resident (we use it in Canada tax law and I believe that it will be used here, as a qualifying clause to determine if your pension and any other foreign income your bring into Thailand is taxable.

[paddypower]

57 minutes ago, TheAppletons said:

 

  If Al Capone was Thai Capone he would have been made Prime Minister.

what if he ''didnt obey the law'' by not filing his tax returns. ??

[paddypower]

1 hour ago, Lorry said:

No. 

Guavaman has posted British rules of remittance-based taxation,  a couple of pages up.

Someone else mentioned that Japan also has remittance-based taxation, but I have no idea of their rules. 

 

The British rules make an interesting read. Most ideas to avoid taxes mentioned in this thread wouldn't be acceptable in Britain. Unfortunately,  the Thai ruling class is very familiar with Britain (and Japan). 

Of course,  many things described in the British rules are hard to prove,  even in Britain.  But tax evasion hoping that the facts will not come to light is very dangerous. What they cannot prove now, maybe they can prove in 7 years? Remember Al Capone.

in the tax business, we called it ''the Thin Red Line'' - the difference between tax avoidance and tax evasion. I guarantee you that the 'elite' have the best Thai tax advisors. 

[paddypower]

4 hours ago, Karma80 said:

None. Hence the speculation. It's one thing to send out a memo; it's quite another to change the law or obtain a ruling in the tax court. In typical Thai style, we could end up with nothing being clarified and things just being a mess for a couple of years as the waters get tested. Shame really. Thailand was the beneficiary of a lot of money which will stay offshore, and not just from expats.

very soon, this will have a negative effect on new sales of investment condos to foreigners. unless buyers are advised by real estate agencies to just rent it out and don't report the income. Realtors are called 'real-a-snakes' in Ireland (partially because many are also lawyers).

[paddypower]

13 hours ago, JimTripper said:

 

why? just get a hotel and look for a new place. unless you are mobility impaired it does not really matter how old you are. if you're just of moving i can understand that, but that can happen at any age.

I think that you are missing the point about the definition of ''resident'' - not to mention the Immigration visa rules, under which  landlords and hotels have to report residents). It's not going to matter - if you're deemed to be resident, you are. Most western countries' tax rules are similar - stay for more than a combined total of 180 days in a calendar year and you are deemed ''resident''.  Thai law is equivalent to quicksand. Or as an American friend described it to me the other day, it's like trying to nail putty to a tree. I don't understand why anyone would find this concept to be be difficult to understand. If these rules goes through, you will be in a Thai taxation prison, for all income brought into Thailand. Is that a fair assessment?

[paddypower]

5 hours ago, JRG23 said:

Looking for new information about this... Has the government issued any new information following the initial announcements? 

RATFLOL

[paddypower]

paddypower,
TroubleandGrumpy quoted one of your posts in a topic.
 

Posted in Thai government to tax all income from abroad for tax residents starting 2024   got this in my in box: ''FFS go and have another beer and tell it to the bar girls - who gives a rats rear about what yet another barfly in Pattaya thinks - or maybe a 'feral'..      Poor fella, why doesn't your wife buy you a goat - may help you to stop from being troubleandgrumpy.?

[paddypower]

On 10/24/2023 at 12:04 PM, Des1 said:

I'm from Canada.

Do a google search for: -Convention Between Canada and the Kingdom of Thailand- and you will find the following…

 

Re: Contracting States. If he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident of the State of which he is a national.

 

Article 18

 

Pensions

 

1. Pensions and other similar remuneration, whether they consist of periodic or non-periodic payments, for past employment, arising in a Contracting State and paid to a resident or the other Contracting State shall be taxable only in the first-mentioned State.

 

2. For the purpose of paragraph 1 such remuneration for past employment shall be deemed to arise in a Contracting State if the payer is that State itself, a political subdivision, a local authority or a resident of that State. Where, however, the person paying such income, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment, and such income is borne by such permanent establishment, then such income shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

 

 

... so as I understand it, because of this agreement I am not required to pay tax in Thailand.

can I ask are you Canadian resident for tax purposes, or deemed non-resident?