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

[topt]

1 minute ago, Mavideol said:

correct???,

yes

[kuma]

On 12/20/2023 at 11:57 AM, Mike Lister said:

Just one point, the government is not impoverished, some people are saying it is but there's no proof of that, all the evidence is to the contrary. Exports, tourism, government debt, reserves, they are all in very very positive territory so linking this tax initiative with impoverishment is inappropriate. The IMF is actually urging them to increase deficit spending to build out infrastructure, in other words, borrow more! That is not to say they wont blow their current position with these 10k giveaways which could turn the whole thing on its head.

 

The realties are that the tax net in Thailand is the smallest one in ASEAN and the numbers have been falling for years. Revenue from direct taxation is less than 2% of the budget whereas in the West it is in excess of 35%. The stated desire has long been to increase the number of people in the net, now they are extended the size of the net as well. But it will be several years before any real financial benefit is seen, by which time the current financial giveaway proposals will be history. 

IMO the % of tax is under no obligation to increase to the levels in the "corrupted west", governments which,which use the tax base now to grift from and support their favourite causes, from which they also grift from.

The Thai people are a very cohesive nation and also compromised of very rugged, self reliant, individual/family minded people and they should keep their government minimal and continue the self reliance - as opposed to the increasingly hope less populations in the cw, that now seem to only know how to use narrative to defect any and all responsibility off their shoulders, with hands out non stop and looking around bewildered, wondering why government does not take care of absolutely everything in their lives ....ok rant off

The direct taxation of revenue of in excess of 35% in the cw, is NOT A GOAL to attain, it is a scourge to be avoided. I hope the Thai nation/civilization reach that same conclusion.

Happy holidays

[Mavideol]

2 minutes ago, topt said:

yes

so if I understand you correctly, currently Thais don't pay taxes, correct???

[Fat is a type of crazy]

Probably been said once or 100 times in the last 177 pages but it is unbelievable that they announce it and with 10 days till 2024 still haven't made it clear what it is to be and how people will be affected. 

[topt]

1 minute ago, Mavideol said:

so if I understand you correctly, currently Thais don't pay taxes, correct???

Sounds like a trick question.........No - not correct in absolute terms. 

 

Simplistically this whole thread is about a change in a directive which essentially removes a loophole of being able to remit income in the following year from which it was earned and not pay any tax on it - for any tax resident.

 

If you really (and I am not sure how serious you are) didn't know that I suggest you go back and read from the start.

[Ben Zioner]

3 hours ago, Fat is a type of crazy said:

Probably been said once or 100 times in the last 177 pages but it is unbelievable that they announce it and with 10 days till 2024 still haven't made it clear what it is to be and how people will be affected. 

I thought it was clear: any income earned after Jan 1, 2024 and remitted any time after Jan 1, 2024 must be reported via a tax return, from March 2025  onwards. Couldn't  be clearer  than that. You may claim a Tax credit if the income has been already taxed and a DTA between Thailand and the country where the income has be earned is in place. The details of reporting will probably be worked out on the fly, in typical Thai fashion. 

 

I may be worth to remember that in Thailand yo may  get a pretty  harsh punishment for rather minor offences. I doubt I'd survive more then a couple of months in a Thai prison. Imagine dying of urinary retention because they don't give you your prostate medication? That kind of stuff happens daily here.

Edited December 21, 2023 by Ben Zioner

[noobexpat]

8 hours ago, The Cyclist said:

 

 

And I am still waiting on an answer on how I can get a NT tax code and pay Zero tax on my Government Pension by filling in a P85

 

For a Government Pension, a small income and some Interest on savings.

 

Setting up venture capital trusts or enterprise investment is going way beyond filling in a P85 as you previously claimed.

 

Now who is being dumb ? 

 

And it never took me 7 days to come up with an answer either, or resort to google

 

Government pension. Bit of a jobsworth? 555

[Ralf001]

4 hours ago, Ben Zioner said:

I thought it was clear: any income earned after Jan 1, 2024 and remitted any time after Jan 1, 2024 must be reported via a tax return, from March 2025  onwards. Couldn't  be clearer  than that. You may claim a Tax credit if the income has been already taxed and a DTA between Thailand and the country where the income has be earned is in place. The details of reporting will probably be worked out on the fly, in typical Thai fashion. 

 

I may be worth to remember that in Thailand yo may  get a pretty  harsh punishment for rather minor offences. I doubt I'd survive more then a couple of months in a Thai prison. Imagine dying of urinary retention because they don't give you your prostate medication? That kind of stuff happens daily here.

 

Tax returns in Thailand have to be lodged no later than March 31st.

 

So "from March 2025  onwards" does that mean lodge by 31st March 2026 ?

[jerrymahoney]

10 hours ago, topt said:

Simplistically this whole thread is about a change in a directive which essentially removes a loophole of being able to remit income in the following year from which it was earned and not pay any tax on it - for any tax resident.

But according to what some believe on here, it was always possible (at least since FEB 2016) to remit foreign-sourced funds in the current year as long as it was structured as a maintenance gift to a spouse tax-free up to 20 million baht per year.

 

Just no evidence that any high-roller has ever done it.
 

Edited December 21, 2023 by jerrymahoney

[CartagenaWarlock]

11 hours ago, topt said:

Simplistically this whole thread is about a change in a directive which essentially removes a loophole of being able to remit income in the following year from which it was earned and not pay any tax on it - for any tax resident.

Here is an example of a loophole that they want to close. A Thai buys stocks in the US and sells it for a profit later. He is not obligated to pay any US capital gain tax because he is a foreigner (and the US assumes he pays in his own country). He parks the money in a US bank and brings it back the following year to avoid Thai taxes. It's closed now, of course. As usual, Thailand did not take into account the thousands of people living in Thailand because they had to travel 10,000 miles for a decent living in a foreign land. What about them? It is not sorted out yet.  

[Felt 35]

20 hours ago, Danderman123 said:

You don't think there's a chance that people with retirement visas will be asked to provide a copy of their tax return upon renewal? Note that bank passbooks are requested at visa renewal, so checking for incoming cash is easy.

 

I personally don't think so, because then Immigration should accept the Tax payment Certificate and Certificate of Residence from the tax authority as proof of income for extensions. Which have been tried but with a big no from Immigration.

Felt

[Danderman123]

47 minutes ago, CartagenaWarlock said:

Here is an example of a loophole that they want to close. A Thai buys stocks in the US and sells it for a profit later. He is not obligated to pay any US capital gain tax because he is a foreigner (and the US assumes he pays in his own country). He parks the money in a US bank and brings it back the following year to avoid Thai taxes. It's closed now, of course. As usual, Thailand did not take into account the thousands of people living in Thailand because they had to travel 10,000 miles for a decent living in a foreign land. What about them? It is not sorted out yet.  

IIRC, foreign nationals with capital gains in the US are subject to a substantial withhold upon a sale.

[Mike Lister]

14 hours ago, stat said:

Spot on your post! However some people (not you) in this forum do not want to understand the most basic tax principles i.e. the difference between corporate taxes and personal taxes or what is reported in CRS or what purpose CRS serves. They just read one line in the tax code and claim to have understood it all.

Yet others persuade us that CRS is one one thing, which they they know because they are a consultant who works with such data every day and are expert. But when others post confirmation that CRS is something else entirely and they are invited to debate the matter and fight their corner, they hide under rocks and in dark corners. It is not so much a question of who is right and who is wrong, it is more a question of what is correct. Will my transactions be recorded and be capable of being viewed at the detailed level asks poster A. Oh no, how can it be, CRS is consolidated data. Hmm, not so says another, here's the record layout from CRS. Personally, even though I'm not an "expert" tax consultant, I'm going with the latter because there is evidence and the poster is credible but I'll leave it for those involved to argue the toss. We have no horse in this race but it would be good to understand the truth, especially when it comes from the mouths of "experts", allegedly.

Edited December 22, 2023 by Mike Lister

[Yumthai]

41 minutes ago, Danderman123 said:

IIRC, foreign nationals with capital gains in the US are subject to a substantial withhold upon a sale.

No.

 

https://www.amalinvest.com/halal-investing/taxes-on-stocks-for-international-investors

 

In summary, foreign investors ('non-resident aliens' in IRS tax speak) are not liable for capital gains tax, but are subject to dividend and estate taxes. Dividends are withheld by the broker before distributions are made to the investor.

[Danderman123]

5 minutes ago, Yumthai said:

No.

 

https://www.amalinvest.com/halal-investing/taxes-on-stocks-for-international-investors

 

In summary, foreign investors ('non-resident aliens' in IRS tax speak) are not liable for capital gains tax, but are subject to dividend and estate taxes. Dividends are withheld by the broker before distributions are made to the investor.

you are correct.

 

There are other investments where foreigners have to pay taxes, maybe including real estate.

[Yumthai]

10 hours ago, Ben Zioner said:

I may be worth to remember that in Thailand yo may  get a pretty  harsh punishment for rather minor offences. I doubt I'd survive more then a couple of months in a Thai prison. Imagine dying of urinary retention because they don't give you your prostate medication? That kind of stuff happens daily here.

Fortunately, you will never be jailed for minor tax evasion in Thailand as the millions of supposed Thai taxpayers who do not (intentionally or wrongly) file and pay tax.

 

[Eudaimonia]

3 hours ago, Yumthai said:

In summary, foreign investors ('non-resident aliens' in IRS tax speak) are not liable for capital gains tax, but are subject to dividend and estate taxes. Dividends are withheld by the broker before distributions are made to the investor.

 

No capital gains tax for the sale of US stocks. 15% withholding tax on dividends for Thailand tax residents. Portfolio interest (debt instruments like bonds and some preferred stocks) is tax-free.

[Mike Teavee]

4 hours ago, Mike Lister said:

Yet others persuade us that CRS is one one thing, which they they know because they are a consultant who works with such data every day and are expert. But when others post confirmation that CRS is something else entirely and they are invited to debate the matter and fight their corner, they hide under rocks and in dark corners. It is not so much a question of who is right and who is wrong, it is more a question of what is correct. Will my transactions be recorded and be capable of being viewed at the detailed level asks poster A. Oh no, how can it be, CRS is consolidated data. Hmm, not so says another, here's the record layout from CRS. Personally, even though I'm not an "expert" tax consultant, I'm going with the latter because there is evidence and the poster is credible but I'll leave it for those involved to argue the toss. We have no horse in this race but it would be good to understand the truth, especially when it comes from the mouths of "experts", allegedly.

 

Can you imagine the amount of data that would need to be exchanged if every country signed up to CRS shared detailed information about every transaction made! 

 

Added to that, how are you going to Identify Individuals? - Can't be on Passport number as my UK bank doesn't have my passport details (I don't even think I had a passport when I opened the account & if I did, I've had at least 5-6 new ones since & there's no onus on me to tell them), can't be on a Tax Identification Number as my UK Bank doesn't know my UK or Thailand TIN, so you get into the realms of trying to match by names (I sometimes do/don't use my middle name), dates of birth, addresses etc... Which again, is not practical given the amount of data involved.  

 

It must be consolidated data exchanged with maybe a mechanism to request the underlying transactions but you still have the problem of being able to accurately identify all transaction for a single individual.

 

 

 

[Mike Lister]

4 minutes ago, Mike Teavee said:

 

Can you imagine the amount of data that would need to be exchanged if every country signed up to CRS shared detailed information about every transaction made! 

 

Added to that, how are you going to Identify Individuals? - Can't be on Passport number as my UK bank doesn't have my passport details (I don't even think I had a passport when I opened the account & if I did, I've had at least 5-6 new ones since & there's no onus on me to tell them), can't be on a Tax Identification Number as my UK Bank doesn't know my UK or Thailand TIN, so you get into the realms of trying to match by names (I sometimes do/don't use my middle name), dates of birth, addresses etc... Which again, is not practical given the amount of data involved.  

 

It must be consolidated data exchanged with maybe a mechanism to request the underlying transactions but you still have the problem of being able to accurately identify all transaction for a single individual.

 

 

 

Poster @Ben Zioner seemed to have different views.

[2baht]

19 hours ago, stat said:

Spot on your post! However some people (not you) in this forum do not want to understand the most basic tax principles i.e. the difference between corporate taxes and personal taxes or what is reported in CRS or what purpose CRS serves. They just read one line in the tax code and claim to have understood it all.

177 pages and still some are in the dark??? None too bright! 🙄

[Mike Teavee]

28 minutes ago, Mike Lister said:

Poster @Ben Zioner seemed to have different views.

 

I suspect the answer is somewhere in the middle ground, the Schema can be found here https://www.oecd.org/tax/exchange-of-tax-information/common-reporting-standard-xml-schema-user-guide-for-tax-administrations-june-2019.pdf so will see what it says :) 

 

 

Edit: I've looked at the Schema and as far as I can tell it's all about reporting the "Closing" Account Balances (not transactions) & given that the mandatory CRS reporting requirement is annually it's likely that once per year all finance organizations will report the closing balance for all accounts that they hold....

 

Even if it was reporting daily it would be considered "Amalgamated" (Not transactional) data. 

 

 

 

Whilst on the OECD site I also noticed this...

 

In light of the rapid development and growth of the Crypto-Asset market and to ensure that recent gains in global tax transparency will not be gradually eroded, in April 2021 the G20 mandated the OECD to develop a framework providing for the automatic exchange of tax-relevant information on Crypto-Assets. In August 2022, the OECD approved the Crypto-Asset Reporting Framework (CARF) which provides for the reporting of tax information on transactions in Crypto-Assets in a standardised manner, with a view to automatically exchanging such information.

https://www.oecd.org/tax/automatic-exchange/common-reporting-standard/

 

Which I guess would rule out any plans to use Crypto to somehow get around being seen to remit money into Thailand.  

Edited December 22, 2023 by Mike Teavee

[James105]

18 hours ago, Fat is a type of crazy said:

Probably been said once or 100 times in the last 177 pages but it is unbelievable that they announce it and with 10 days till 2024 still haven't made it clear what it is to be and how people will be affected. 

 

I think its just a case of prepare for the worst and hope for the best, although as someone else pointed out it is pretty clear that any monies transferred into Thailand after 1 Jan will be assessed for tax. 

 

So to counter this I'm transferring 2+ years worth of spending money into my Thai bank account prior to 1st Jan for example, and if the worst happens, put the money I might have to pay in tax towards fun travelling adventures for 6 months every other year, and during that "other year" transfer enough into the Thai account for the next 2 years etc. 

 

I'd be surprised if this scheme gets off the ground though as (like most tax raising measures) when under serious analysis will be found to be completely counter productive and result in less tax revenue overall.   

[Mike Lister]

12 minutes ago, Mike Teavee said:

 

I suspect the answer is somewhere in the middle ground, the Schema can be found here https://www.oecd.org/tax/exchange-of-tax-information/common-reporting-standard-xml-schema-user-guide-for-tax-administrations-june-2019.pdf so will see what it says :) 

 

Whilst on the OECD site I also noticed this...

 

In light of the rapid development and growth of the Crypto-Asset market and to ensure that recent gains in global tax transparency will not be gradually eroded, in April 2021 the G20 mandated the OECD to develop a framework providing for the automatic exchange of tax-relevant information on Crypto-Assets. In August 2022, the OECD approved the Crypto-Asset Reporting Framework (CARF) which provides for the reporting of tax information on transactions in Crypto-Assets in a standardised manner, with a view to automatically exchanging such information.

https://www.oecd.org/tax/automatic-exchange/common-reporting-standard/

 

Which I guess would rule out any plans to use Crypto to somehow get around being seen to remit money into Thailand.  

Once again, I have never had a horse in this race but like you, I was initially inclined to believe that it is consolidated, Ben s post convinced me otherwise whereas the expert thinks and argued.....well, we know what he thinks!

[bugger bognor]

22 hours ago, Ben Zioner said:

I thought it was clear: any income earned after Jan 1, 2024 and remitted any time after Jan 1, 2024 must be reported via a tax return, from March 2025  onwards. Couldn't  be clearer  than that. You may claim a Tax credit if the income has been already taxed and a DTA between Thailand and the country where the income has be earned is in place. The details of reporting will probably be worked out on the fly, in typical Thai fashion. 

 

I may be worth to remember that in Thailand yo may  get a pretty  harsh punishment for rather minor offences. I doubt I'd survive more then a couple of months in a Thai prison. Imagine dying of urinary retention because they don't give you your prostate medication? That kind of stuff happens daily here.

Really! your spouting bull<deleted> where has it been announced that all expats have been ordered to register for a TN and submit an tax return you <deleted>

[JimGant]

15 hours ago, Ben Zioner said:

I thought it was clear: any income earned after Jan 1, 2024 and remitted any time after Jan 1, 2024 must be reported via a tax return, from March 2025  onwards. Couldn't  be clearer  than that.

 

Yeah, but the operative word is "income." And how will they know what part of my remittance is income, and which part is an inheritance from my Aunt Martha? They can't know, so self assessment will necessarily come into play, because the alternative -- tax all cash flows coming into Thailand -- is bonkers.

 

Thus, I'll memorize the DTA, and know that amounts I send to Thailand that don't exceed my Air Force and Social Security payments (exempt by treaty from Thai taxes) are not taxable; and additional amounts, since it's a Wise transfer from a savings account established with inherited money, I'll just claim FIFO. Now, that accounting term is  probably only applicable to inventories, not remittances. But I'll let them chew on that, because who's to say I can't pick and choose from a fungible pot of money.

 

My take: no assessable income here. No tax filing required. (stay tuned, of course)

 

 

[TroubleandGrumpy]

7 minutes ago, JimGant said:

 

Yeah, but the operative word is "income." And how will they know what part of my remittance is income, and which part is an inheritance from my Aunt Martha? They can't know, so self assessment will necessarily come into play, because the alternative -- tax all cash flows coming into Thailand -- is bonkers.

 

Thus, I'll memorize the DTA, and know that amounts I send to Thailand that don't exceed my Air Force and Social Security payments (exempt by treaty from Thai taxes) are not taxable; and additional amounts, since it's a Wise transfer from a savings account established with inherited money, I'll just claim FIFO. Now, that accounting term is  probably only applicable to inventories, not remittances. But I'll let them chew on that, because who's to say I can't pick and choose from a fungible pot of money.

 

My take: no assessable income here. No tax filing required. (stay tuned, of course)

There is a severe downside to that strategy - unless the Thai RD declares that the type of money you are remitting into Thailand is not taxable income.  The downside is that if you are wrong (according to Thai RD), and the Thai RD 'catches' you, there are severe penalties for not lodging a tax return, and for not paying income taxes (including 1.5% per month interest on any income tax they calculate you should have paid).  Unless the Thai RD declares that the type of money you are remitting into Thailand is not taxable income, then it would be wise to lodge a tax return and state that you owe zero income taxes and why.  That way if they say nothing, you are OK, and if they disagree you know where you stand.

 

But as you said - stay tuned. Things will develop and change - hopefully soon. 

[Ben Zioner]

15 minutes ago, bugger bognor said:

Really! your spouting bull<deleted> where has it been announced that all expats have been ordered to register for a TN and submit an tax return you <deleted>

Not need to get rabid. They don't need to mention expats, the said that all residents for the purpose of taxation (strictly more than 179 days in country) will have to file a tax return. Why would you think that this wouldn't include the so called expats? 

[Ben Zioner]

18 minutes ago, JimGant said:

Yeah, but the operative word is "income." And how will they know what part of my remittance is income, and which part is an inheritance from my Aunt Martha?

Easy, it will be up to you to justify your tax credits/exemption. If your funds are available, move them right now (before January 1, 2024), into an account where you keep them clean until you transfer them to Thailand. Everything you earn after January 1 won't be considered as savings. Now about Aunt Martha's inheritance this will be handled on the fly, the Thai way, as I said in my opening comment; it certainly won't stop them from starting collecting.

[JimGant]

21 minutes ago, TroubleandGrumpy said:

Unless the Thai RD declares that the type of money you are remitting into Thailand is not taxable income, then it would be wise to lodge a tax return and state that you owe zero income taxes and why.

 

The DTA already says the type of money I'm remitting is not taxable. And, where on a Thai tax return would I put my Air Force and Social Security income, and designate it as "exempt per treaty?" No, declaring to Thai RD my "non assessable income" just opens up more areas for confusion. A poster here has been declaring his non assessable income on his return for years, and has gotten nods, "yes, no taxable income -- thank you very much white man (snickers in the background)."

[Mike Teavee]

18 minutes ago, Ben Zioner said:

Not need to get rabid. They don't need to mention expats, they said that all residents for the purpose of taxation (strictly more than 179 days in country) will have to file a tax return. Why would you think that this wouldn't include the so called expats? 

Do you have a link to where that was said? 

 

Fact is the only thing that has changed is that income earned from 1/1/24 will now be tax assessable any time in the future (assuming you're Tax Resident) instead of the current "Rules" which says it would only be tax assessable if remitted in 2024.

 

If you do not remit anything that would be Tax assessable this year then there is no need to file a Tax Return in 2024 & if you do not remit anything that is Tax assessable income in 2024, there will be no need to file a tax return in 2025... and so on... 

 

Am sure you could file a Nil Return if you wanted to but there is absolutely no need to unless your investigated by the Revenue & if you've not remitted anything that is Tax assessable then you've nothing to worry about.