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

[jaywalker2]

12 hours ago, jayboy said:

The existing regulation isn't enforced nor do the Thai authorities expect foreign residents or Thais to pay tax on overseas non current income streams.That of course may change wef 2024.Let's see.If I am required by law to pay more tax, that's fine.

 

For those who pay tax unnecessarily I can think of several adjectives - public spirited, hopelessly naive etc but 'good' doesn't really come to mind.

 

Those foreigners who have a desperate need to pay tax regardless of whether it is required or not can always write a cheque and send it to the Thai Ministry of Finance.I'm sure it would be welcomed.

Give me a break While the rich in Thailand avoid paying hardly any tax at all, foreigners should rejoice that they're going to be double or triple taxed? Ask Bill Gates, Elon Musk, and all the other rich guys how they feel about that. But I guess you would say they lack "public spirit."

[Mike Lister]

1 minute ago, The Cyclist said:

 

In the last 5 years you will have lost about 20-25% in annual increases.

 

Were you ever " Opted out " in previous employment ?
 

That would explain your lower level of pension.

Yes of course, I contracted out and that money was invested in a Self Invested Personal Pension (SIPP) with Hargreaves Lansdowne and now gives me a monthly income that is equal to the state pension. In total, my state pension and SIPP income is far higher than the new state pension, plus I can control how much i receive, and it's still invested. For those reasons I don't too much care about losing the 20 or 25% in increases.

[Mike Lister]

5 minutes ago, The Cyclist said:

 

When you are " Opted out " it means that you paid a reduced rate of NI for the years that you were opted out.

 

That reduction in NI equates to a reduction in the State Pension, it also means that you do not qualify for SERPS 2, or whatever it was called.

 

Nothing to do with a Private pension.

"What is contracting out. If you were contracted out of the Additional State Pension (also known as State Second Pension or 'SERPs') your National Insurance contributions were either: lower than people paying into the Additional State Pension. paid into another pension, for example a private pension".

 

https://www.gov.uk/contracted-out#:~:text=were contracted out-,What is contracting out,for example a private pension

[The Cyclist]

2 minutes ago, Mike Lister said:

Yes of course, I contracted out and that money was invested in a Self Invested Personal Pension (SIPP)

 

I am only explaining why your State Pension is so low.

 

1 - Lower initial payment because you were  ' opted out '

 

2 - Periods when your State Pension was frozen.

[The Cyclist]

2 minutes ago, Mike Lister said:

If you were contracted out of the Additional State Pension (also known as State Second Pension or 'SERPs') your National Insurance contributions were either: lower than people paying into the Additional State Pension. paid into another pension, for example a private pension".

 

It would depend on various factors, as does most things.

 

The terms of my Government Pension dictated that I could not invest in a Private Pension, whilst accruing that Pension.

 

It doesn't change the fact that if you were ' Opted out ' you paid reduced rates of NI and therefore recieved a smaller State Pension than you would have recieved if you were ' Not opted out '

[Mike Lister]

Just now, The Cyclist said:

 

It would depend on various factors, as does most things.

 

The terms of my Government Pension dictated that I could not invest in a Private Pension, whilst accruing that Pension.

 

It doesn't change the fact that if you were ' Opted out ' you paid reduced rates of NI and therefore recieved a smaller State Pension than you would have recieved if you were ' Not opted out '

Yes, that's true, but I think you are missing the point. My state pension is 550 Pounds per four weeks, my SIPP income which was funded by the contracted out payments, totals 500 Pounds per calendar month. The sum total of those two things equals an amount that is greater than the new state pension of 221 per week. I therefore don't object to receiving a smaller state pension because in total I recieve more and have greater control.

[The Cyclist]

9 minutes ago, Mike Lister said:

Yes, that's true, but I think you are missing the point. My state pension is 550 Pounds per four weeks, my SIPP income which was funded by the contracted out payments, totals 500 Pounds per calendar month. The sum total of those two things equals an amount that is greater than the new state pension of 221 per week. I therefore don't object to receiving a smaller state pension because in total I recieve more and have greater control.

 

You are trying to compare the value of a State Pension in combination with a SIPP with a single State Pension.

 

Private investment Pension should always trump a State Pension. The value of the State Pension does not change regardless if you pay NI at  £30 a week or £100 a week, what changes the value is the number of qualifying years you contribute.

 

My Private Pension trumps my Government Pension, even though it was accrued over a much shorter period. The difference being that I shovelled money into my Private Pension and my Government Pension was non contributory.

 

Swings and roundabouts, and when I eventually get the State Pension, it will be a very poor relation to the other 2 pensions.

[stat]

46 minutes ago, jaywalker2 said:

Give me a break While the rich in Thailand avoid paying hardly any tax at all, foreigners should rejoice that they're going to be double or triple taxed? Ask Bill Gates, Elon Musk, and all the other rich guys how they feel about that. But I guess you would say they lack "public spirit."

Anyone who feels undertaxed can donate to the tax authorities anytime. I sure hope jaywalker2 is doing his fair share?

 

Reminds me of this joke: Two communists sit in a bar! Like if you had two houses you would give one to me, right? " The second one thought about it for a second and said "yes, of course." The first man then says "if you had two cars would give me one?" The second guy says "yeah, sure." The first guy then says "what if you had two chickens would give me one?" The second communist immediately says "No." The first communist gets very confused and upset. "But you said you would give me a house! You said you would give me a car! But you wouldn't give me goddamn chicken!?" The Second just looks at him and says "well you see, I own two chickens.

Edited November 13, 2023 by stat

[Puccini]

4 hours ago, Deerculler said:

Will we have to pay tax on our pensions from our home countries?

 

If you talk about taxation in Thailand, it depends on

a) the total af assessable income, and

b) the total of allowed deductions, and

c) the result of a minus b

[kkjjhhss]

Currently, the majority of Japanese digital nomads are making plans to escape from Thailand. On Twitter, you can see the highest number of comments in the world from Japanese people every day about Thailand's overseas sources.

This is because many Japanese digital nomads have Thailand elite visas, and they earn high incomes from cryptocurrencies, securities trading, and nomad work. They have an offshore company and offshore accounts. Therefore, a corporation's profits become foreign source income. In the case of Thailand, foreign source income has been tax-free for over 30 years, so many Japanese have taken advantage of this tax-saving scheme. If this is not possible from 2024 Jan 1, most Japanese people will withdraw from Thailand. They are actively discussing this on Twitter everyday. 

What about Chinese people or you guys Farangs?　

 

I think Chinese people are thinking the same thing. They have a stronger sense of ownership of condominiums than any other race, but as foreigners leave, condo prices also fall. This is because the supply will be greater. For the Chinese people, this will only be a negative. Who on earth would buy such a trashed condo in Thailand?

[stat]

On 11/2/2023 at 6:21 AM, Celsius said:

All these schemes movung here, moving there will end up costing more than simply paying tax in Thailand. 

 

There are really only 2 options. Stay in Thailand or move permanently elsewhere.

You are aware that your calculation only applies if you do not have to pay for example like 100,000 USD p.a. in taxes? Guess you are not...

[stat]

Thailand just announced that they want to know who holds TH financial instruments via clearstream. So if a thai or a westerner holds a thai share or debt instrument in a western account TH will know you by name. Majority of banks uses clearstream to book all financial instruments. I think this targets the rich Thais.

 

https://www.clearstream.com/clearstream-en/securities-services/market-coverage/asia-pacific/thailand/disclosure-requirements-thailand-1280830

Edited November 13, 2023 by stat

[Mike Lister]

6 hours ago, The Cyclist said:

 

You are trying to compare the value of a State Pension in combination with a SIPP with a single State Pension.

 

Private investment Pension should always trump a State Pension. The value of the State Pension does not change regardless if you pay NI at  £30 a week or £100 a week, what changes the value is the number of qualifying years you contribute.

 

My Private Pension trumps my Government Pension, even though it was accrued over a much shorter period. The difference being that I shovelled money into my Private Pension and my Government Pension was non contributory.

 

Swings and roundabouts, and when I eventually get the State Pension, it will be a very poor relation to the other 2 pensions.

I give up!

[jacob29]

5 hours ago, kkjjhhss said:

Currently, the majority of Japanese digital nomads are making plans to escape from Thailand. On Twitter, you can see the highest number of comments in the world from Japanese people every day about Thailand's overseas sources.

They might be talking about it, but it's unlikely the majority are going to act - on the simple basis there's few alternatives. You make it sound like they can move to Cambodia or something. Nope, you'll end up paying more tax in Malaysia, Cambodia, Indonesia, Vietnam - I believe every single country in the region except for the Philippines. Since all these countries tax your worldwide income regardless of whether it gets remitted.

 

There are some countries they can go (I think), but they're usually small countries. Nothing wrong with that if you like a quiet lifestyle, but it's not believable that the majority are are going to make that trade off. Same deal with Philippines, some people love the place, but it's not for everyone, even with generous tax perks.

Edited November 13, 2023 by jacob29

[jaywalker2]

8 hours ago, stat said:

Anyone who feels undertaxed can donate to the tax authorities anytime. I sure hope jaywalker2 is doing his fair share?

 

Reminds me of this joke: Two communists sit in a bar! Like if you had two houses you would give one to me, right? " The second one thought about it for a second and said "yes, of course." The first man then says "if you had two cars would give me one?" The second guy says "yeah, sure." The first guy then says "what if you had two chickens would give me one?" The second communist immediately says "No." The first communist gets very confused and upset. "But you said you would give me a house! You said you would give me a car! But you wouldn't give me goddamn chicken!?" The Second just looks at him and says "well you see, I own two chickens.

You missed my point. The rich do everything they can to avoid paying taxes. So tax authorities focus on squeezing the people who can't fight back.

[Mike Lister]

40 minutes ago, jaywalker2 said:

You missed my point. The rich do everything they can to avoid paying taxes. So tax authorities focus on squeezing the people who can't fight back.

The facts don't support your argument.

 

Only 6% of the population pay personal income tax and they are mostly in PAYE equivalent schemes or people on salaries in companies.

 

Personal income tax is a very small contribution to GDP, less than 2.1%, tax from corporations (or rich companies) is a much higher percentage.

 

Generous tax deductions and allowances mean that the self employed can turnover 1 million baht a year and pay almost no tax.

 

 

[Mike Teavee]

10 hours ago, The Cyclist said:

 

When you are " Opted out " it means that you paid a reduced rate of NI for the years that you were opted out.

 

That reduction in NI equates to a reduction in the State Pension, it also means that you do not qualify for SERPS 2, or whatever it was called.

 

Nothing to do with a Private pension.

You can't "Opt Out", you are "Contracted Out" by the company you work for & as part of that they have to put the reduced Employer NI contributions that they pay into a pension for you so Private Pensions do come into it.

 

Don't know about reduced Employee contributions as I paid the maximum NI contribution even though I was "Contracted Out".   

 

  

Edited November 14, 2023 by Mike Teavee

[Mike Teavee]

10 hours ago, The Cyclist said:

 

I am only explaining why your State Pension is so low.

 

1 - Lower initial payment because you were  ' opted out '

 

2 - Periods when your State Pension was frozen.

But even if you were Contracted Out, you can make additional AVCs to take your pension up to the full amount & this is approx.  £10,600 pa, so nobody is going to be taken over their personal tax allowance by an 8% or so increase. 

[Mike Lister]

1 minute ago, Mike Teavee said:

But even if you were Contracted Out, you can make additional AVCs to take your pension up to the full amount & this is approx.  £10,600 pa, so nobody is going to be taken over their personal tax allowance by an 8% or so increase. 

It's a political hot potato, the first government that does that will be accused of hypocrisy and will alienate the votes of the older crowd, quite rightly so, give with one hand, take away with the other.

[Mike Teavee]

On 11/2/2023 at 12:21 PM, Celsius said:

All these schemes movung here, moving there will end up costing more than simply paying tax in Thailand. 

 

There are really only 2 options. Stay in Thailand or move permanently elsewhere.

There is a 3rd option which is to spend every 3rd year being non Tax Resident in Thailand & bring over the spends you need for the next 3 years 

 

Using very simplified numbers, I spend approx. 150K pm in Thailand which means I have to bring in 1.8Million every year.  After the tax changes I might need to bring in 2.5M (It's closer to 2.6M but I'm assuming 30% tax & ignoring banding or allowances) - so 700K pa x 3 = 2.1M, I can have a great 6 month holiday with that & whilst sipping a cocktail on the beach, raise a glass to the Thai RD department for funding it. 

[Mike Lister]

17 minutes ago, Mike Teavee said:

There is a 3rd option which is to spend every 3rd year being non Tax Resident in Thailand & bring over the spends you need for the next 3 years 

 

Using very simplified numbers, I spend approx. 150K pm in Thailand which means I have to bring in 1.8Million every year.  After the tax changes I might need to bring in 2.5M (It's closer to 2.6M but I'm assuming 30% tax & ignoring banding or allowances) - so 700K pa x 3 = 2.1M, I can have a great 6 month holiday with that & whilst sipping a cocktail on the beach, raise a glass to the Thai RD department for funding it. 

Such irony, it's sheer genius.

[Danderman123]

38 minutes ago, Mike Teavee said:

But even if you were Contracted Out, you can make additional AVCs to take your pension up to the full amount & this is approx.  £10,600 pa, so nobody is going to be taken over their personal tax allowance by an 8% or so increase. 

It sounds like there needs to be a topic about UK pensions, because this discussion is not germane to this topic.

[Danderman123]

On 11/2/2023 at 12:21 PM, Celsius said:

All these schemes movung here, moving there will end up costing more than simply paying tax in Thailand. 

 

There are really only 2 options. Stay in Thailand or move permanently elsewhere.

or stay in Thailand 179 days per year.

 

I am off to Brazil after New Years day.

[BobBKK]

12 hours ago, Mike Lister said:

My state pension is frozen but every few years I return and it gets uprated, I did that last, 5 years ago by moving into my UK flat and saying I'd returned.

so it's ok to lie then?

[jayboy]

12 hours ago, Mike Lister said:

My state pension is frozen but every few years I return and it gets uprated, I did that last, 5 years ago by moving into my UK flat and saying I'd returned.

 

Oh

[Mike Lister]

1 hour ago, BobBKK said:

so it's ok to lie then?

I haven't lied. The rules are that any returning expat is allowed to have their state pension uprated, the rules state that the definition of returning is the intention to spend at least six months each year in the UK. I bought my flat in the UK in 2018 with exactly that in mind. In 2019 we spent six months there but covid prevented our return. And please, don't get righteous with me or try to occupy the moral high ground on this. I've been here in Thailand on a full time and permanent basis (or attempted to be) since 2004. I have told HMRC and DWP from Day One of my whereabouts and my intentions. I have never ever tried to defraud either by receiving unauthorised pension increases, winter fuel supplement etc.

[Mike Lister]

59 minutes ago, jayboy said:

 

Oh

And you need to stop following me around and delivering your one or two word answers, if you are able to formulate a sentence and have something to say, say it. In the meantime, if you have observations on this point, I suggest you read the post the adjacent post.

[The Cyclist]

2 hours ago, Mike Teavee said:

You can't "Opt Out", you are "Contracted Out" by the company you work for

 

Call it what you will ' Opted out ' or ' contracted out ' The end result was the same.

 

2 hours ago, Mike Teavee said:

But even if you were Contracted Out, you can make additional AVCs to take your pension up to the full amount

 

Sure, but as AVC's haven't been mentioned, they were not really part of the discussion. I am not evenconvinced that you pay AVC's towards the State Pension, it is more a Private / Company Pension thing.

 

You can pay VNI's  towards your State Pension, but in some cases this will be a waste of money.

 

Quote

Voluntary contributions don’t always increase your State Pension. They also can’t be refunded, so make sure you’ll benefit from making them.

 

https://www.moneyhelper.org.uk/en/pensions-and-retirement/state-pension/voluntary-national-insurance-contributions-and-the-state-pension

 

You can pay VIN's  to make up your qualifying years if you are short of the 35 qualifying years to get the maximum State Pension.

 

[Mike Lister]

1 minute ago, The Cyclist said:

 

Call it what you will ' Opted out ' or ' contracted out ' The end result was the same.

 

 

Sure, but as AVC's haven't been mentioned, they were not really part of the discussion. I am not evenconvinced that you pay AVC's towards the State Pension, it is more a Private / Company Pension thing.

 

You can pay VNI's  towards your State Pension, but in some cases this will be a waste of money.

 

 

https://www.moneyhelper.org.uk/en/pensions-and-retirement/state-pension/voluntary-national-insurance-contributions-and-the-state-pension

 

You can pay VIN's  to make up your qualifying years if you are short of the 35 qualifying years to get the maximum State Pension.

 

Additional Voluntary Contributions or Voluntary National Insurance Contributions are the same thing, it's semantics, just like opted out and contracted out is. And yes, I did make voluntary NI contributions to increase my years paid to 29, just prior to retirement.

[The Cyclist]

4 minutes ago, Mike Lister said:

Additional Voluntary Contributions or Voluntary National Insurance Contributions are the same thing, it's semantics,

 

Obviously they are not, as my AVC's increased death benefits or increased my pension if I did not die. Which as the link provided above shows is not the case with VNI's and the State Pension.

 

6 minutes ago, Mike Lister said:

And yes, I did make voluntary NI contributions to increase my years paid to 29, just prior to retirement.

 

Rather odd that you did not mention this when I previously gave 2 examples of things that would effect the size of your State Pension payout.

 

Anyway, it is getting rather monotonous and the next thing people want to really hear about the UK State Pension is whether the Thai Gov / RD is going to tax it due to not being a Government Pension and therefore not covered by the UK - Thai DTA.

 

Keep your eyes peeled and you will be able to deliver the bad, or good news as the case may be.