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

[Ricardo]

1 hour ago, jacko45k said:

I had plans, but darn that baht has recently got more expensive!

One suspects a last-minute rush of resident-expats, getting their dosh into the country, before the deadline !  

[JimGant]

13 hours ago, Guavaman said:

USA IRS: Taxable income: Generally, an amount included in your income is taxable unless it is specifically exempted by law. Income that is taxable must be reported on your return and is subject to tax. Income that is nontaxable may have to be shown on your tax return but is not taxable. 

 

Actually, Taxable Income (TI) is Adjusted Gross Income (AGI) less your Standard Deduction (or itemizations, if those are greater than Standard Deduction). So, AGI is equivalent to the Thai "assessable income" (AI). And in a similar fashion to the US, Thai Taxable Income would be what's left after you subtract out allowances and exemptions. Thus, if single, you automatically have at least 210,000 (150+60) subtracted out from your assessable income to arrive at Taxable Income. But, you're required to file a return if you have 120,000 in AI; but you have no Taxable Income until your assessable income exceeds 210,000..... So, why do the Thais want all these tax forms filed if there's no taxable income, thus no check attached? Are they taking a survey? Dumb.

 

To the US example, you don't have to file a tax return if you have no Taxable Income (unless you're self-employed). Of course, most do file, mainly to get back over withholdings of taxes.

[JimGant]

14 hours ago, Guavaman said:

Currently, the RD tax code under Section 42 does not specify that any category of income is exempt from taxation under DTAs.

 

If push came to shove between a country's Tax Code and a Tax Treaty, the treaty would prevail. As an example. The US Tax Code says that you can get a tax credit on your US tax return for taxes paid to a foreign country IF those taxes were against foreign earned income. But, under the US DTA with Thailand, for example, if Thailand gets exclusivity (overriden by the saving clause, however) in the taxation of my IRA or private pension (which they do, if, currently remitted), the treaty says I can get a credit for those taxes paid on my IRA, even tho' this is US income, not foreign income. You simply have to attach Form 8833 to your tax credit Form 1116, which tells the IRS that their Code has been trumped by an international treaty.

 

Hopefully, we won't have to get the Embassy involved with the Ministry of Finance over any misunderstandings.....

[jerrymahoney]

57 minutes ago, JimGant said:

So, why do the Thais want all these tax forms filed if there's no taxable income, thus no check attached? Are they taking a survey? Dumb.

Because there would be 2 types of expats not filing: Those who would not be filing because they are below the minimum assessible income filing level and those who just do not file regardless because they consider themselves below the Revenue radar.

 

i.e. the earlier topic: Living in Thailand using only ATM money for more than 6-months - tax consequences

Edited December 25, 2023 by jerrymahoney

[jayboy]

1 hour ago, Ricardo said:

One suspects a last-minute rush of resident-expats, getting their dosh into the country, before the deadline !  

 

Correct, and I would suggest that those that do are essentially in a holding pattern, perhaps remitting funds sufficient for 2024 but not much more.It wouldn't make sense as matters stand to remit more than one year's subsistence to Thailand because (a) there is still too much uncertainty on exactly what is proposed and (b) investments/cash holdings acquired prior to 1.1.24 would be exempt from tax anyway.

[Jingthing]

3 minutes ago, jayboy said:

 

Correct, and I would suggest that those that do are essentially in a holding pattern, perhaps remitting funds sufficient for 2024 but not much more.It wouldn't make sense as matters stand to remit more than one year's subsistence to Thailand because (a) there is still too much uncertainty on exactly what is proposed and (b) investments/cash holdings acquired prior to 1.1.24 would be exempt from tax anyway.

Yes and no.

If those funds would be exempt, you may need to file and then prove they are exempt.

[TroubleandGrumpy]

3 minutes ago, jayboy said:

 

Correct, and I would suggest that those that do are essentially in a holding pattern, perhaps remitting funds sufficient for 2024 but not much more.It wouldn't make sense as matters stand to remit more than one year's subsistence to Thailand because (a) there is still too much uncertainty on exactly what is proposed and (b) investments/cash holdings acquired prior to 1.1.24 would be exempt from tax anyway.

Yes indeed - just organised my last transfer.  Next year I will only remit into Thailand my Pension - no retirement savings -  until things are clarified and certainty is obtained. Anyone bringing in a large amount of money in 2024 is obviously either brave, stupid or a gambler (or all) - or they are not aware of the issue.  I am not sure that it is not possible to be aware - but I do understand that some retirees here are just 'having a party'.  

[JimGant]

10 minutes ago, jerrymahoney said:

Because there would be 2 types of expats not filing: Those who would not be filing because they are below the minimum assessible income filing level and those who just do not file regardless because they consider themselves below the Revenue radar

 

Doubtful the filing threshold was established well below the taxable income level due to sneaky farangs....

[TroubleandGrumpy]

2 minutes ago, Jingthing said:

Yes and no.

If those funds would be exempt, you may need to file and then prove they are exempt.

The new rule starts 1 January 2024 - anything remitted into Thailand before that date remains under the old arrangement. 

Any money remitted into Thailand after 1 Jan 2024 is under the new rules/regulation.

[Jingthing]

Just now, TroubleandGrumpy said:

The new rule starts 1 January 2024 - anything remitted into Thailand before that date remains under the old arrangement. 

Any money remitted into Thailand after 1 Jan 2024 is under the new rules/regulation.

Now I'm confused.

Wasn't there a ruling that funds that were earned BEFORE Jan 1 2024 and remitted later are also exempt of the new rules?

[jerrymahoney]

3 minutes ago, JimGant said:

 

Doubtful the filing threshold was established well below the taxable income level due to sneaky farangs....

That's why they are sneaky.

[Mike Lister]

2 minutes ago, Jingthing said:

Now I'm confused.

Wasn't there a ruling that funds that were earned BEFORE Jan 1 2024 and remitted later are also exempt of the new rules?

Yes.

[jayboy]

20 minutes ago, Jingthing said:

If those funds would be exempt, you may need to file and then prove they are exempt.

 

One of the many points that needs to be clarified.

[JimGant]

16 minutes ago, TroubleandGrumpy said:

Anyone bringing in a large amount of money in 2024 is obviously either brave, stupid or a gambler.....

 

..... or wants to buy a condo. No, the Thais aren't going to kill FDI, a golden goose, the pride of the BoI, who works directly for the Prime Minister's office. And to screen all remittances as income is not only self-defeating and stupid -- it's impossible to parse income from capital. Nope, this scheme will either be dropped; or put on hold until they can regroup and tax foreign income, not remittances. FDI would be saved, and CRS and FATCA information, worthless for remittance reporting, could now be used to flush out tax avoiders. Stay tuned.

 

[Ben Zioner]

26 minutes ago, TroubleandGrumpy said:

The new rule starts 1 January 2024 - anything remitted into Thailand before that date remains under the old arrangement. 

Any money remitted into Thailand after 1 Jan 2024 is under the new rules/regulation.

You haven't gotten this right it is: any money  earned and remitted after 1 jan 2024 will be  taxed. Any money earned before that date  is subject to the old rule i.e taxed if remitted the year of earning.

[JimGant]

29 minutes ago, Jingthing said:

If those funds would be exempt, you may need to file and then prove they are exempt.

 

Or just prevent any new inputs to that savings or checking account that you were filtering your remittances through. And open a new one for post Dec 31st inputs. Then, just remit from that old account, which you could clearly show only held pre 2024 inputs.

 

Again, under this new rule about pre 2024 funds, not sure how you'd work this into a tax filing, since by definition, these are non assessable monies. But, I guess, if someone really wanted these monies identified, they would have to design some kind of reporting form or instruction.

 

This has all become so mind boggling, I can't believe the Thais haven't cried "uncle" yet.

[JimGant]

16 minutes ago, Ben Zioner said:

Any money earned before that date  is subject to the old rule i.e taxed if remitted the year of earning.

 

Well, yeah. But we're talking about remittances made post Jan 1, 2024 from a pot of money established pre-Jan 1, 2024. Ergo, certainly not remitted in year earned.

[Ben Zioner]

5 minutes ago, JimGant said:

 

Well, yeah. But we're talking about remittances made post Jan 1, 2024 from a pot of money established pre-Jan 1, 2024. Ergo, certainly not remitted in year earned.

Hence, not taxed.

[The Cyclist]

20 minutes ago, JimGant said:

This has all become so mind boggling, I can't believe the Thais haven't cried "uncle" yet.

 

Perhaps the reason for silence and an unwillingness to provide further updates.

[tomkenet]

2024 will be just like previous years.

Last years earnings will not be taxable when remitted.

 

2025 will be the first year with the new rules. Last year earnings will be taxable when remitted.

 

 

 

Edited December 25, 2023 by tomkenet

[Eudaimonia]

4 hours ago, jacko45k said:

I had plans, but darn that baht has recently got more expensive!

 

There is a useful futures contract trading on the Singapore Exchange – SGXTU, or Thai Baht in US Dollar Futures. I've used it to hedge my January 2024 transfers, in case people start remitting a lot.

[Etaoin Shrdlu]

2 hours ago, JimGant said:

 

If push came to shove between a country's Tax Code and a Tax Treaty, the treaty would prevail. As an example. The US Tax Code says that you can get a tax credit on your US tax return for taxes paid to a foreign country IF those taxes were against foreign earned income. But, under the US DTA with Thailand, for example, if Thailand gets exclusivity (overriden by the saving clause, however) in the taxation of my IRA or private pension (which they do, if, currently remitted), the treaty says I can get a credit for those taxes paid on my IRA, even tho' this is US income, not foreign income. You simply have to attach Form 8833 to your tax credit Form 1116, which tells the IRS that their Code has been trumped by an international treaty.

 

Hopefully, we won't have to get the Embassy involved with the Ministry of Finance over any misunderstandings.....

 

In the instructions for form 8833 there appears to be a carve-out of reporting requirements for individuals who claim relief under a tax treaty for, among other things, pensions. What is your take on this? Does this mean that form 8833 is not required if claiming tax credits under form 1116 for Thai taxes paid on remittances of private pensions or IRA/401k withdrawals?

[Enzian]

Wait. I've been intending to remit an almost token US 4 or 5 K collected lately from my tenants in the US this week, just before the new year, to bulk up my (one mil plus) Thai account a tad and then just spend the account down all during 2024 until just  two months before my Non-O renewal, which conveniently, in my case, comes up in the 3rd week of December 2024. And by that time we might all know more. Or would it be better to remit that 4 or 5 K in the first week after New Years?

Edited December 25, 2023 by Enzian

[Sheryl]

3 hours ago, JimGant said:

 

 So, why do the Thais want all these tax forms filed if there's no taxable income, thus no check attached? Are they taking a survey? Dumb.

 

 

 

they have never said they do.

 

AFAIK there has been no change to reporting requirements, which remain that you do nto need to file if you owe no taxes (i.e. have AI below 210k).

 

Last thing the RD would want is an onslaught for re4turns from people owing no tax. Huge workload for them to no benefit.

 

It is expats on this forum who keep speculating about a requirement to file even if no tax owed.

[daveAustin]

What about bringing foreign cash in and exchanging say 150k baht worth at Superrich? Would they likely have that angle covered, too? I know you have to hand over your passport...

[Eudaimonia]

7 minutes ago, Enzian said:

Wait. I've been intending to remit an almost token US 4 or 5 K collected lately from my tenants in the US this week, just before the new year, to bulk up my (one mil plus) Thai account a tad and then just spend the account down all during 2024 until just  two months before my Non-O renewal, which conveniently, in my case, comes up in the 3rd week of December 2024. And by that time we might all know more. Or would it be better to remit that 4 or 5 K in the first week after New Years?

 

It's your 2023 offshore rental income, so you can remit now and file a tax return in March showing it as assessable 2023 income remitted in the same year it was earned. Or you can wait until January and get it tax free.

[Enzian]

9 minutes ago, Eudaimonia said:

It's your 2023 offshore rental income, so you can remit now and file a tax return in March showing it as assessable 2023 income remitted in the same year it was earned. Or you can wait until January and get it tax free.

I won't even be in Thailand in March 2024; I have a flight out 1st week February and do not intend to reenter for about three months, possibly more. I've never earned money in Thailand and never filed a tax return here, and have never anticipated or been told that I have to file in 2024 to account for the various remittances I made with current income during 2023. Is this stated somewhere? That it is something that applies to everyone? Can someone clarify?

[Mike Lister]

2 hours ago, JimGant said:

 

This has all become so mind boggling, I can't believe the Thais haven't cried "uncle" yet.

They are not going to, that won't happen, the loss of face would be too much. Anyway, just because it's mind boggling to you, doesn't mean it is so for their tax nerds, it will be a walk in the park for people who enjoy this stuff and who know what they are doing..

Edited December 25, 2023 by Mike Lister

[jayboy]

2 hours ago, Ben Zioner said:

Any money earned before that date  is subject to the old rule i.e taxed if remitted the year of earning.

 

What am I missing here? How in the future (ie from 1.1.24) can money earned before 1.1.24 be remitted in the year of earning?

[Eudaimonia]

38 minutes ago, Enzian said:

I won't even be in Thailand in March 2024; I have a flight out 1st week February and do not intend to reenter for about three months, possibly more. I've never earned money in Thailand and never filed a tax return here, and have never anticipated or been told that I have to file in 2024 to account for the various remittances I made with current income during 2023. Is this stated somewhere? That it is something that applies to everyone? Can someone clarify?

 

No worries. You can file in January as well. Of course, if you did not stay 180+ days in Thailand in 2023, you're not even a tax resident, so you do not need to file anything.

 

Overall, it looks like it's just me and maybe ten other foreigners in the country who have bothered to hire tax lawyers and auditors to structure their affairs and follow tax laws here and in every other country we have interests in. For 99% of expats in Thailand, it seems to be a big surprise that their foreign source income and remittances may have been taxable all along because they did not even follow the current rule and wait until the next calendar year to remit it.

 

I would not expect the Revenue Department to start investigating old remittances, but they do have the 2023 CRS data, so who knows.