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

[Dogmatix]

15 minutes ago, topt said:

I am not doubting your personal anecdote but otherwise I do not remember reading of "surprise visits" earlier in this thread unless it was to do with having claimed for tax withheld on interest perhaps?

I don't suppose you have bookmarked any of these reports?

 

Sorry no.  It was quite early on but I can vouch for the guy I know personally. It was a few years ago. He is Danish and did a one year post retirement consulting gig for his former employer in Bangkok that got him into the tax net after working for them offshore for many years.  A couple of years later they showed up at his house demanding to know why he hadn't continued to file tax returns.  He said he was retired and living off his Danish pension which he was having sent to his Thai bank directly, rather than accumulating it and remitting in the next tax year.  They asked to see his pension documents and when he said he had paid Danish tax, they asked to see evidence of that which he showed them.  Then they said that was OK because the remittances had already been taxed in Denmark and went away without suggesting that he should pay the difference between Danish and Thai tax.  The next year they came back again asking the same questions. He is an irascible bloke and told his daughter to tell them the situation was the same as on their previous visit without offering them any documents. Then he told her to give them 1,000 baht to go away and never come back. They took the cash and waied politely, left without demanding any documents and never came back.  That is how he told it to me and I have no reason to believe he lied.  

 

RD officers can and do visit people in their homes unannounced.  I have seen posts in other AN threads from people reporting surprise RD home visits in Phuket regarding tax on business they were doing in the Thai wife's name.  One of my concerns is that, although it is unlikely to be official policy, RD inspectors, who have a lot of authority, may go rogue and visit farang pensioners in their homes to shake them down for pin money.  Officers in most big cities have plenty of other fish to fry but this seems more likely in resort areas and rural areas where farangs stand out like sore thumbs. With no official guidelines on how to interpret DTAs or what documentation is needed for tax credits individual officers may apply some exaggerated interpretations and expect bribes to go away.  Foreigners are more vulnerable because they tend not to have connections and generally don't know the law. plus are fearful of criminal convictions that might affect visa renewals. The way the RD is applying this non-law is an open invitation to extortion and corruption.

[topt]

10 hours ago, Dogmatix said:

I have seen posts in other AN threads from people reporting surprise RD home visits in Phuket regarding tax on business they were doing in the Thai wife's name.

Ok so a little more involved than your original comment which imo alluded to those retired and not earning in Thailand.

 

10 hours ago, Dogmatix said:

One of my concerns is

I don't totally disagree but one can hope that this and other threads will arm readers appropriately.

[Yumthai]

11 hours ago, Dogmatix said:

A good example of why you need to be able read Thai and make the effort to look at the original to opine on this stuff.  Nearly all the farang tax advisors are illiterate in Thai and just read translations and/or rely on unreliable Thai staff and often jump to conclusions that are completely wrong.

Absolutely. That's why I think we won't be able to articulate an accurate and reliable version of these equivocal rules.

At the end of the day, the only law interpretation that matters is the official one coming directly from the horse's mouth.

 

According to several reports, it seems that the general consensus from various RD offices is: "If you have no tax to pay you don't need to file a tax return", conversely to "You must file a tax return in any case even if eventually your tax burden is 0".

 

For people who worry about enforcement the most relevant thing to do is to reach their local RD office in person to get proper (written if possible) answers about their tax situation.

 

[freeworld]

11 hours ago, Dogmatix said:

 

Sorry no.  It was quite early on but I can vouch for the guy I know personally. It was a few years ago. He is Danish and did a one year post retirement consulting gig for his former employer in Bangkok that got him into the tax net after working for them offshore for many years.  A couple of years later they showed up at his house demanding to know why he hadn't continued to file tax returns.  He said he was retired and living off his Danish pension which he was having sent to his Thai bank directly, rather than accumulating it and remitting in the next tax year.  They asked to see his pension documents and when he said he had paid Danish tax, they asked to see evidence of that which he showed them.  Then they said that was OK because the remittances had already been taxed in Denmark and went away without suggesting that he should pay the difference between Danish and Thai tax.  The next year they came back again asking the same questions. He is an irascible bloke and told his daughter to tell them the situation was the same as on their previous visit without offering them any documents. Then he told her to give them 1,000 baht to go away and never come back. They took the cash and waied politely, left without demanding any documents and never came back.  That is how he told it to me and I have no reason to believe he lied.  

 

RD officers can and do visit people in their homes unannounced.  I have seen posts in other AN threads from people reporting surprise RD home visits in Phuket regarding tax on business they were doing in the Thai wife's name.  One of my concerns is that, although it is unlikely to be official policy, RD inspectors, who have a lot of authority, may go rogue and visit farang pensioners in their homes to shake them down for pin money.  Officers in most big cities have plenty of other fish to fry but this seems more likely in resort areas and rural areas where farangs stand out like sore thumbs. With no official guidelines on how to interpret DTAs or what documentation is needed for tax credits individual officers may apply some exaggerated interpretations and expect bribes to go away.  Foreigners are more vulnerable because they tend not to have connections and generally don't know the law. plus are fearful of criminal convictions that might affect visa renewals. The way the RD is applying this non-law is an open invitation to extortion and corruption.

Probably a result of Danish tax authorities doing an audit on their nationals in Thailand, I think it was them that visited and made a checkup I think a few years ago. So allegedly this Danish guy paid some money to make his tax matters disappear?

 

RD have offices all over the country and they do surprise tax audits on many companies.

 

DTA are what they are and follow the UN or OECD model of DTA, its not open to an individual tax inspector to interpret. The reasoning and explanation behind these agreements and articles is more detailed and complicated than just in the doc itself.

Edited April 23 by freeworld

[Mike Lister]

13 minutes ago, Yumthai said:

Absolutely. That's why I think we won't be able to articulate an accurate and reliable version of these equivocal rules.

At the end of the day, the only law interpretation that matters is the official one coming directly from the horse's mouth.

 

According to several reports, it seems that the general consensus from various RD offices is: "If you have no tax to pay you don't need to file a tax return", conversely to "You must file a tax return in any case even if eventually your tax burden is 0".

 

For people who worry about enforcement the most relevant thing to do is to reach their local RD office in person to get proper (written if possible) answers about their tax situation.

 

Is there really any downside to following the rules as they are set out centrally and filing a return, even when no tax is due? 

[Yumthai]

26 minutes ago, Mike Lister said:

Is there really any downside to following the rules as they are set out centrally and filing a return, even when no tax is due?

I follow the rules the way I interpret it i.e.: no assessable income, no need to file a tax return.

If I'm wrong in my assessment I'll comply to the rules when directly required from the official authority.

[TroubleandGrumpy]

16 hours ago, Dogmatix said:

 

Not sure what you mean by this but, if your question is "Has anything been enacted requiring tax payments on remittances of foreign source income from any year in the past, the answer is no."  This was just done via an internal order to RD staff telling them to interpret the Revenue Code differently from how it has been interpreted since the 1980s based on a clear ruling at that time. To enact this re-interpretation would require an act of parliament with full parliamentary process and public consultation which could easily result in its defeat in parliament. If the government could make a case that it requires emergency legislation, they could enact the reinterpretation through a Royal Decree. However, given that the ruling has stood since the 1980s and the RD is unable to give any idea of how much incremental revenue it stands to collect from this, the urgency requiring a Royal Decree would risk being challenged and the decree potentially nullified.

 

The order is binding on RD staff but not binding on taxpayers who are obviously not subject to RD orders to staff. The RD has argued that, since it is a directive to staff on how to explain the Revenue Code to members of the public, taxpayers have a duty to follow advice from RD officers and pay tax accordingly.  This a pathetic legal argument which would not stand up in a court in a rule of law jurisdiction and may also not stand up in the Thai Tax Court, if challenged and hopefully it will be but no sign of that yet.

 

A lot of people are also unaware that within the broad parameters of the Revenue Guide and precedent, the decision maker is the Officer in the local Provincial TRD Office.  TRD Officers are just like the Immigration Officers at annual renewal time - they have a large amount of arbitrary authority and can be 'troublesome'.   Likewise, just like Immigration, some TRD Offices will interpret things/rules differently to others. Certainly a decision can be appealed against (TRD Trinbunal and Courts) but it must be 100% in Thai - all written and verbal communications must be in Thai.  

Hopefully, some Thai person or company lodges an appeal against this new 'interetation' and/or the implementation of it with 3 months notice. I am concerned why that has not already happened - anyone think they knwo why?  When Malaysia introduced the same new 'rule' in 2021 they delayed its implementaion for personal income taxes until 2026 to allow people a chance to adjust their personal financial affairs.  IMO they are much smarter over there - this delay gives people a few years to sell up cash redeem etc, and then bring that money back to Malaysia.  Thailand gave no such notice. There was an increase in incoming remittances over Oct-Dec quater last year, but most wealthy Thai people will be working to keep the money overseas (of course) and only bring it back when whatever changes needed have been made (eg. as gifts to wife?). 

 

All types of foreign source income (“FSI”) received by resident individuals in Malaysia are exempt from Malaysian income tax from 1 January 2022 to 31 December 2026 [except for individuals who carry on business through a partnership in Malaysia] provided the income has been subjected to tax in the country of origin. Effective 1 January 2027, all the FSI would be taxable in Malaysia upon remittance by tax resident individuals.

https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/01/TIES-Malaysia.pdf

Placeholder for Title 2nd line (kpmg.com)

 

[TroubleandGrumpy]

16 hours ago, Mike Lister said:

I am revising para's 4 & 5 of the Simple Guide to indicate who must file a tax return as follows:

Thai tax laws require Foreigners who reside in Thailand, for one or more periods, with at least 180 days in one tax calendar year, AND who receive income from inside or outside Thailand via:

 a) Income from employment (wages, salaries, remuneration, etc.) assessable under Section 40 of the Revenue Code;

b) Income from business operations is assessable under Section 40.Cancel

c) Passive or property income (interest, dividends, rental income, goodwill, pension, capital gains etc.) based on Article 41 paragraph 2 of the Revenue Code.

 ......to assess their income for Thai tax and file a tax return, providing the  assessable income threshold has been exceeded. Thai-sourced income is always taxable in Thailand, wherever it is received and regardless of tax residence status. Foreign sourced income is subject to remittance, tax residency and other factors such as terms of a DTA.

 The following individuals are required to file income tax returns for income earned in the preceding tax year irrespective of whether there is any tax due:

 • A person who has no spouse and earns income of more than Baht 60,000

• A person who has no spouse and earns income under category (1) (salaries and wages) of more than Baht 120,000

• A person who has a spouse and earns income of more than Baht 120,000

• A person who has a spouse and earns income under category (1) (salaries and wages) of more than Baht 220,000".

 https://www.pwc.com/th/en/tax/assets/thai-tax/thai-tax-booklet-2023-24.pdf

 

Just in case someone has read this post in the absence of reading the whole document and all the background, this is not a directive or advice from the TRD - it is what has been published on the PWC website and it is their opinion (marketing).

 

To example how an opinion is not necessarily based on advice/directive from TRD, and should not be taken as such - this below is also published on the PWC website:

 

Thailand taxes its residents and non-residents on their assessable income derived from employment or business carried on in Thailand, regardless of whether paid in or outside Thailand. Residents who derive income from abroad are taxable on that income if remitted into Thailand in the year in which it is received.

Thailand - Individual - Taxes on personal income (pwc.com)

 

I am not saying the advice published by PWC is totally incorrect - but I am saying that it is not 100% fact. Until TRD provides the needed directives and advice, no one knows exactly how this new rule interpretation will be implemented in TRD.  More in a minute.

Edited April 23 by TroubleandGrumpy

[Mike Lister]

13 hours ago, Dogmatix said:

 

The RD English versions are only for guidance and they sometimes add nuances that are not there in the original in order to try to make them read better in English.  In the case of Section 56 the Thai phrase that is translated as "taxpayer" is บุคคล which just means "person", not "taxpayer".  

 

A good example of why you need to be able read Thai and make the effort to look at the original to opine on this stuff.  Nearly all the farang tax advisors are illiterate in Thai and just read translations and/or rely on unreliable Thai staff and often jump to conclusions that are completely wrong. It is also important to be able to search for case studies in Thai.

Your point is well taken and the example of taxpayer is also very good. But isn't this exactly what the large tax and accountancy firms have done, Big 4 firms almost certainly won't rely on what others say, they will do as you have done and gone to the original source of the information and make their own translations. Some posters have suggested that the likes of PWC and other large firms have a bias and only want to scare people into using them for assistance with tax. That's ridiculous of course since the Big 4 aren't interested in consumer tax prep or advice, they want large commercial clients. It follows therefore that reading documents such as the latest PWC handbook will provide reliable answers to many of the questions and issues being debated here, without resorting to reinventing the wheel case in point, the quotes posted several times regarding who must file a tax return, but argued as incorrect., 

[Mike Lister]

17 minutes ago, TroubleandGrumpy said:

 

Just in case someone has read this post in the absence of reading the whole document and all the background, this is not a directive or advice from the TRD - it is what has been published on the PWC website and it is their opinion - nothing more.  I dont agree with that advice - not 

 

To example how an opinion is not necessarily based on advice/directive from TRD, and should not be taken as such - this below is also published on the PWC website:

 

Thailand taxes its residents and non-residents on their assessable income derived from employment or business carried on in Thailand, regardless of whether paid in or outside Thailand. Residents who derive income from abroad are taxable on that income if remitted into Thailand in the year in which it is received.

Thailand - Individual - Taxes on personal income (pwc.com)

 

I am not saying the advice published by PWC is totally incorrect - but I am saying that it is not 100% fact. Until TRD provides the needed directives and advice, no one knows exactly how this new rule interpretation will be implemented in TRD.  More in a minute.

Please see Dogmatix quote from the TRD on this point, it mirrors the PWC quote.

 

p

[TroubleandGrumpy]

As stated many times, until TRD provide all the needed clarifications and directives regarding this new rule interetation and how it applies to Expats, everything is opinion and speculation.  To example this the following is provided from HLB Thailand 

 

Thailand's Revenue Department has issued an instruction that changes its interpretation of the taxation of foreign income remitted into Thailand by personal taxpayers, effective from 1 January 2024. The instruction, dated 15 September 2023, states that a tax resident of Thailand who derives assessable income from an employment or business carried on abroad, or from a property situated abroad shall, upon bringing such assessable income into Thailand, pay tax on such income.

New rule for taxation of foreign income from 1 Jan 2024 | HLB Thailand

 

If you read that document in detail and go through their other statements online, it is their opinion that this new directive applies to foreign income remitted into Thailand from employment, or a business carried on abroad, or from a property situated abroad.  My interetation of their statements is that it is only applicable to those catagories, and covers remitted money from: people working in job and being paid overseas while living in Thailand, people living in Thailand who have a business overseas that they are running,  and people earnign income from property rentals/investments.  Perhaps they are wrong and it will apply to everything and everyone - I do not think so but I do know that no one can say for sure because TRD is keeping quiet - and that is why at this time everything is uncertain and not definitive. 

[TroubleandGrumpy]

1 hour ago, Yumthai said:

I follow the rules the way I interpret it i.e.: no assessable income, no need to file a tax return.

If I'm wrong in my assessment I'll comply to the rules when directly required from the official authority.

That is m,y opinion too - why bring youirself to their attention is my view - the downsides are extreme and SFA upside as far as I can see.

[Mike Lister]

I don't know how constructive or useful it is to pit the views of one tax consultancy against another or even to pit two opposing members views against each other, when for the moment nothing can be confirmed.

 

The position of the Tax Guide is that the interpretation of the RD code by Dogmatix in his earlier post, confirmed by the PWC handbook extract, also posted several times, is as good as it gets for the time being, until the TRD comes along and speaks differently. 

 

I'm therefore leaving the wording in the document on this topic, as is, but will point out to members that I have added a disclaimer on the first page, explaining the difficulty we have in arriving at an agreed definitive end point on all aspects.

 

 

[Presnock]

On 4/20/2024 at 5:01 PM, Dogmatix said:

 

I thought you said you were not going to have anything to do with the tax guide or any tax threads only a few days ago.

I personally feel that if the Revenue Department in CH or BKK decides to just tax ALL monies being remitted and then letting the ex-pats file a claim for double taxes or taxes on exempted due to the DTA then I feel and will complain to the US State Department and US Embassy and US Congress that the Thai government is violating the DTA between the US and Thai Govenments and I as an American have been paying my taxes to the US govt for 60+ years and am entitled to be protected by this legally binding agreement.  Now if the Thai government decides that they will first cancel these agreements and begin either re-negotiating them or forgetting forever as they lose a bunch of funds from those of us that have already paid our taxes then I will leave even though I hate that thought even.  I enjoy life here and know it is not perfect but I as an American have a strong feeling about improper taxes, just ask the British about that feeling as it goes back about 250 years.  I really do not think that the Thai government will decide to arbitraruly decide to go against 60+ DTA agreements but again as I have mentioned often, TIT and anything that can go wrong just might.  Hopefully, we will get some guidance from the RD soonest.  good luck to all suck up that pollution, run those a/c while we can still afford it maybe.

[Presnock]

On 4/22/2024 at 12:12 PM, TroubleandGrumpy said:

Perhaps - but if I wanted to avoid scrutiny andf paying income taxes on illegal/laundered money, all I have to do is buy an LTR and I am exempt from income taxes. That is against the global obligations to reduce/illiminate illegal/laundered money exchanges between countries.

Not all income is exempt on the LTR.  If money is earned in Thailand and is assessable the a tax could be levied.  Only foreign earned income can be non-taxed for wealthy pensioner that I read about for my income so if they change that provision of the LTR and still insist on taxing my already taxed government pension then I will be gone but in my opinion this would be a futile income garnering by the Thais that would resonate deeply in the future of foreign settlers.

[JimGant]

1 hour ago, TroubleandGrumpy said:

this new directive applies to foreign income remitted into Thailand from employment, or a business carried on abroad,

As has been referenced many times on this thread, pensions are considered 'income from employment.' Hard to argue with that.

[redwood1]

You guys act like the Thai government is working very hard to dot every I and cross every T on this tax matter....lol.....Based on past performance on a long long list of other things they most likely are hopelessly lost in this very complex tax swamp...

They have shown countless times they very very much like things unclear and not defined...This serves the brown envelope brigade quite well concerning all sorts of legal matters..

Edited April 23 by redwood1

[Mavideol]

after 262 pages of posts, there is not a single one providing a plausible answer to the issue at hand. Did anybody try to get a Tax ID number or do all of you have a tax id number, because I did try to get one at 3 different tax offices in 3 different provinces, and they ALL told me the same thing, in order to get a tax id number one needs to have a work permit, I am retired thus no need for Tax Id number, I did explain to the person in charge that there was a consensus going around claiming that retired expats would/could be forced to file tax returns, all 3  provinces (Phang Nga, Krabi and Trang) said exactly the same thing, they are/were not aware of any changes to the taxation system.

[JimGant]

2 hours ago, Yumthai said:

2 hours ago, Mike Lister said:

Is there really any downside to following the rules as they are set out centrally and filing a return, even when no tax is due?

I follow the rules the way I interpret it i.e.: no assessable income, no need to file a tax return.

If I'm wrong in my assessment I'll comply to the rules when directly required from the official authority.

Obviously, the downside is wasting time filing a nil tax return. Certainly, most of us have better things to do with our time than filling out a tax return with blank lines, after maybe having to waste time to get a TIN -- and maybe in both situations, having to go downtown, hunt for a parking place, then dealing with Thai bureaucrats. Is there really a downside, you ask? Rhetorical, of course -- since there's no upside, as there's no percentage penalty on zero taxes owed. And the 2000 baht fine for not filing a return if you have 120k assessable income -- is not a hard-and-fast nailed down law. But I'd pay 2000bt to not have to drive downtown -- twice.

 

Yumthai, did you mean "taxable income," not "assessable income?"

[JimGant]

5 minutes ago, Mavideol said:

because I did try to get one at 3 different tax offices in 3 different provinces, and they ALL told me the same thing, in order to get a tax id number one needs to have a work permit,

 

Seen that on this forum for many years; and it's what I use to justify taking a tax credit for Thai taxes on bank interest -- on my US Tax Form 1040. A single line item for the credit; no further forms, if less than $600 (filing jointly). Sure beats getting a TIN and wasting an afternoon at RD offices, for a measly refund. [If I could get a TIN, I'd be obligated to try and get the refund first from Thailand. But, with multiple reports saying, as a retiree, I can't get a TIN -- an easy peasy response, with supporting notes, to the IRS, in the less than 1% chance I'd get a letter audit.] Certainly not tax evasion or avoidance -- just allowing Thailand to collect the full tax, and the US having to absorb a credit for the same. Seems fair.

[JimGant]

53 minutes ago, Presnock said:

I personally feel that if the Revenue Department in CH or BKK decides to just tax ALL monies being remitted and then letting the ex-pats file a claim for double taxes or taxes on exempted due to the DTA then I feel and will complain to the US State Department

Use your common sense. How would they do that? Certainly you're not going to fill out a Thai tax return with all your remittance data, most of which would be non assessable -- for them to scrutinize? Probably, with no taxable income, you won't even file a tax return, nor even have a TIN. What are the revenuers going to do -- have the banks report all remittances of all farangs -- then have to parse which farangs are tax residents, and which are tourists? Then, what are they going to do? For tax residents, present you with a tax bill based on all your remittances, including loan money sent to BoI for Foreign Direct Investment? NOT!

 

1 hour ago, Presnock said:

Now if the Thai government decides that they will first cancel these agreements and begin either re-negotiating them or forgetting forever

 Thailand has just petitioned to join the OECD Community, the honchos of double tax treaties. Thailand is thus not about to poke any fingers in any eyes. But, tax treaties aren't sacrosanct -- there is something called Tax Treaty Override, whereby a country can change its domestic tax laws, in conflict with treaty language -- as long as the "override" has no significant material effect -- and may actually enhance the substance of the treaty. Here's a discussion on this override:

https://read.oecd-ilibrary.org/taxation/model-tax-convention-on-income-and-on-capital-2014-full-version/r-8-tax-treaty-override_9789264239081-101-en#page1

 

Thus, Thailand, in the interest of less paperwork at RD, may dictate that, yes, if you pay taxes in your home country on income that the DTA says Thailand has exclusive taxation rights on -- then we'll give you a pass on Thai taxes on this income. Thus, the spirit of the DTA is still adhered to, namely, avoiding double taxation. That Thailand, in this example, would sacrifice tax collection -- is Thailand's problem, not the OECD's.

 

The most famous Tax Treaty Override is the US "saving clause" (sometime seen as "savings clause") whereby US Tax Code overrides treaty language by trumping "exclusivity" language on taxation rights, by saying the US can also tax this income -- but only as secondary tax authority. Example: Private pensions and IRAs remitted to Thailand are, per treaty, "exclusively" taxable only by Thailand. But the US saving clause gives the US secondary taxation rights -- but they have to absorb a credit for Thai taxes paid, while Thailand gets to keep the full collection -- just as they would under "exclusivity." Thus, nothing "material" altered in the tax treaty by the saving clause. In fact, the OECD uses this as an example of where "override" enhances the substance of a tax treaty by allowing the US to be a secondary tax collector, in case the exclusive -- now effectively the primary -- tax collector decides not to collect taxes -- as Thailand has done, up till now, with foreign income remitted in a later year.

 

Why does the OECD like this? Because DTAs, originally to prevent double taxation, have expanded to try and prevent "no no taxation." So, newer OECD Model tax treaties are addressing this. But in the meantime, overrides, like the US saving clause, are already addressing this. So, if Thailand presents an override that doesn't materially affect a DTA -- but maybe just means your total tax bill is just redistributed over both countries, not exactly in accordance with the DTA -- so be it. As it is allowed without being a treaty violation.

 

I have to jump in here with a favorite topic of mine, namely, the tax advisor in Bangkok who advertises (or use to advertise), for US folks, that you'll never have to pay taxes on your IRA distributions, if you're a Thai tax resident, and who doesn't remit said IRA to Thailand in same year paid. I guess now, his charlatan claims that IRA remittances are not subject to the saving clause, as bogus as these claims are, are trumped by the new Thai tax guidance on IRA remittances in later years. Anyway, I wonder if anyone reading this has availed the services of this so-called tax expert? (details in the following link):

https://aseannow.com/topic/1008555-tax-specialist-in-chiang-mai/page/2/

 

 

 

 

 

[hwas]

2 hours ago, Presnock said:

Not all income is exempt on the LTR.  If money is earned in Thailand and is assessable the a tax could be levied.  Only foreign earned income can be non-taxed for wealthy pensioner that I read about for my income so if they change that provision of the LTR and still insist on taxing my already taxed government pension then I will be gone but in my opinion this would be a futile income garnering by the Thais that would resonate deeply in the future of foreign settlers.

My suggestion is that you ignore the speculative comments regarding the LTR.  The official word from BOI is that remittances to Thailand are not taxable.  Why pay any attention to comments made regarding the LTR by people who do not even hold the LTR?  

Edited April 23 by hwas

[Presnock]

48 minutes ago, hwas said:

My suggestion is that you ignore the speculative comments regarding the LTR.  The official word from BOI is that remittances to Thailand are not taxable.  Why pay any attention to comments made regarding the LTR by people who do not even hold the LTR?  

I do have the wealthy pensioner LTR - just changed from Retirement O (18 years) - my pension is a US govt pension I know that I have 2 possible reasons for non-assessable income but TIT.  If they do in any way tax my govt pension I will leave even though I love it here.

[Presnock]

59 minutes ago, JimGant said:

Use your common sense. How would they do that? Certainly you're not going to fill out a Thai tax return with all your remittance data, most of which would be non assessable -- for them to scrutinize? Probably, with no taxable income, you won't even file a tax return, nor even have a TIN. What are the revenuers going to do -- have the banks report all remittances of all farangs -- then have to parse which farangs are tax residents, and which are tourists? Then, what are they going to do? For tax residents, present you with a tax bill based on all your remittances, including loan money sent to BoI for Foreign Direct Investment? NOT!

 

 Thailand has just petitioned to join the OECD Community, the honchos of double tax treaties. Thailand is thus not about to poke any fingers in any eyes. But, tax treaties aren't sacrosanct -- there is something called Tax Treaty Override, whereby a country can change its domestic tax laws, in conflict with treaty language -- as long as the "override" has no significant material effect -- and may actually enhance the substance of the treaty. Here's a discussion on this override:

https://read.oecd-ilibrary.org/taxation/model-tax-convention-on-income-and-on-capital-2014-full-version/r-8-tax-treaty-override_9789264239081-101-en#page1

 

Thus, Thailand, in the interest of less paperwork at RD, may dictate that, yes, if you pay taxes in your home country on income that the DTA says Thailand has exclusive taxation rights on -- then we'll give you a pass on Thai taxes on this income. Thus, the spirit of the DTA is still adhered to, namely, avoiding double taxation. That Thailand, in this example, would sacrifice tax collection -- is Thailand's problem, not the OECD's.

 

The most famous Tax Treaty Override is the US "saving clause" (sometime seen as "savings clause") whereby US Tax Code overrides treaty language by trumping "exclusivity" language on taxation rights, by saying the US can also tax this income -- but only as secondary tax authority. Example: Private pensions and IRAs remitted to Thailand are, per treaty, "exclusively" taxable only by Thailand. But the US saving clause gives the US secondary taxation rights -- but they have to absorb a credit for Thai taxes paid, while Thailand gets to keep the full collection -- just as they would under "exclusivity." Thus, nothing "material" altered in the tax treaty by the saving clause. In fact, the OECD uses this as an example of where "override" enhances the substance of a tax treaty by allowing the US to be a secondary tax collector, in case the exclusive -- now effectively the primary -- tax collector decides not to collect taxes -- as Thailand has done, up till now, with foreign income remitted in a later year.

 

Why does the OECD like this? Because DTAs, originally to prevent double taxation, have expanded to try and prevent "no no taxation." So, newer OECD Model tax treaties are addressing this. But in the meantime, overrides, like the US saving clause, are already addressing this. So, if Thailand presents an override that doesn't materially affect a DTA -- but maybe just means your total tax bill is just redistributed over both countries, not exactly in accordance with the DTA -- so be it. As it is allowed without being a treaty violation.

 

I have to jump in here with a favorite topic of mine, namely, the tax advisor in Bangkok who advertises (or use to advertise), for US folks, that you'll never have to pay taxes on your IRA distributions, if you're a Thai tax resident, and who doesn't remit said IRA to Thailand in same year paid. I guess now, his charlatan claims that IRA remittances are not subject to the saving clause, as bogus as these claims are, are trumped by the new Thai tax guidance on IRA remittances in later years. Anyway, I wonder if anyone reading this has availed the services of this so-called tax expert? (details in the following link):

https://aseannow.com/topic/1008555-tax-specialist-in-chiang-mai/page/2/

 

I agree.  DId you in reading that Thailand is applying to join the OECD - report says normally 6-7 years before accepted.  Did you notice the requirements for countries applying - seems to me that there are several requirements that will have to be altered here in Thailand for them to be accepted even if they are able to meet the requirements and get approved for membership in 5 years.  I also do no believe that Thailand will try to tax my account.  I have plenty of proof that it is a govt pension and I have the LTR exemption even if a particular RD official sees something different from the main branch.

 

 

 

I  agree

[paddypower]

On 4/21/2024 at 2:30 PM, nrasmussen said:

 

The answer is that it depends on several factors. You can read about the rules here (official government website in Danish): https://www.borger.dk/pension-og-efterloen/International-pension/Dansk-pension-i-udlandet/International-pension-soege 

Many Thanks . I've located that website. One of the biggest hurdles is that most of the Danish Government agencies assume you can register for (and communicate by) their digital post system. We cannot do that, because, crazy as it may seem,  they rejected my wife's passport photo, because it was taken 7 years ago. Her photo taken today using the NetID app is rejected as not being the same person. I have also contacts Pensions International by phone. I just wish there was a specific Q & A section, that I could translate into English, in order to find out what the various factors are? By the way, my wife did qualify for a Danish pension, for the many years when she lived in Canada (despite not reactivating her Danish citizenship, once the rules allowed dual citizenship.

[4myr]

5 hours ago, Yumthai said:

I follow the rules the way I interpret it i.e.: no assessable income, no need to file a tax return.

If I'm wrong in my assessment I'll comply to the rules when directly required from the official authority.

same thoughts here.

 

If I do like this, I can stay away from TRD for 2-3 years without any foreseeable risks in case they audit me.
During this period TRD staff hopefully will be better prepared with a uniform and documented way of taxing remittance income, including taking care of DTA exemptions. In this period Thailand will also likely sign the new 2023 Netherlands DTA. 

[nrasmussen]

22 minutes ago, paddypower said:

Many Thanks . I've located that website. One of the biggest hurdles is that most of the Danish Government agencies assume you can register for (and communicate by) their digital post system. We cannot do that, because, crazy as it may seem,  they rejected my wife's passport photo, because it was taken 7 years ago. Her photo taken today using the NetID app is rejected as not being the same person. I have also contacts Pensions International by phone. I just wish there was a specific Q & A section, that I could translate into English, in order to find out what the various factors are? By the way, my wife did qualify for a Danish pension, for the many years when she lived in Canada (despite not reactivating her Danish citizenship, once the rules allowed dual citizenship.

 

Here is the application form. Once filled out it can be sent by regular e-mail as stated on page 5. I'd also assume that if you have any questions you can send them to the same e-mail address.

Ansoegning_folkepension_i_udlandetpdf.pdf

[Yumthai]

3 hours ago, JimGant said:

Yumthai, did you mean "taxable income," not "assessable income?"

Yes, you're correct.

I'd rather reformulate: No tax to pay, no need to file a tax return.

Edited April 23 by Yumthai

[hwas]

1 hour ago, Presnock said:

I do have the wealthy pensioner LTR - just changed from Retirement O (18 years) - my pension is a US govt pension I know that I have 2 possible reasons for non-assessable income but TIT.  If they do in any way tax my govt pension I will leave even though I love it here.

I have several friends in the exact same position as you.  Retired here after being posted to the embassy.  None of them have any concerns about this.  

[Lorry]

4 hours ago, Mavideol said:

after 262 pages of posts, there is not a single one providing a plausible answer to the issue at hand. Did anybody try to get a Tax ID number or do all of you have a tax id number, because I did try to get one at 3 different tax offices in 3 different provinces, and they ALL told me the same thing, in order to get a tax id number one needs to have a work permit, I am retired thus no need for Tax Id number, I did explain to the person in charge that there was a consensus going around claiming that retired expats would/could be forced to file tax returns, all 3  provinces (Phang Nga, Krabi and Trang) said exactly the same thing, they are/were not aware of any changes to the taxation system.

IF you really want a TIN - a big if - you can easily get one by applying for a refund of withholding tax (the tax withheld by your Thai bank from the interest of your Thai bank account). 

You have to go to the bank first, they will issue you a document stating how much withholding tax you paid,  then you have to bring this to the RD office.

This can routinely be done for the last 3 years.