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

[pizzachang]

On 9/17/2023 at 8:35 PM, bdenner said:

I'm thinking a lot of you have your "nickers in a twist" over an item that will not effect you!

Yes, you're correct. This refers to people who regularly pay income taxes in Thailand. I imagine, it is Thai citizens, who earn money abroad and pay their taxes.  A retired citizen from another country (not a Thai or a Thai passport holder) is not a "tax resident".  

[lordgrinz]

7 minutes ago, gamb00ler said:

You have correctly named the funds withheld by banks, but the rest is not accurate.  It is attributed to the account holder (by name) even if they don't have have a Thai tax ID.  At the end of the calendar year the account holder can file a Thai tax return and most likely get all the withholding back (dependent upon other income).  If you don't like the nuisance of filing Thai income tax AND your interest income is below 20K ฿ you can apply for a Thai tax and give it to the bank(s) and request they don't withhold tax until your interest exceeds the 20K exemption.  Plus there are personal exemptions, so anybody earning less than about 200K ฿ won't pay any tax.

I assume when you mention "Thai Tax ID", at least in the case of a Farang, you mean the "Pink ID"? Because I just checked my wife's Thai Tax Return and I am listed on it with my Pink ID number.

[Thaindrew]

4 minutes ago, pizzachang said:

Yes, you're correct. This refers to people who regularly pay income taxes in Thailand. I imagine, it is Thai citizens, who earn money abroad and pay their taxes.  A retired citizen from another country (not a Thai or a Thai passport holder) is not a "tax resident".  

a tax resident is everyone that lives here more than 180 days a year (that is clear), currently we are not "forced" to do a tax return but it sounds like we may well be as a way to assess any tax liability

[couchpotato]

4 minutes ago, lordgrinz said:

I assume when you mention "Thai Tax ID", at least in the case of a Farang, you mean the "Pink ID"? Because I just checked my wife's Thai Tax Return and I am listed on it with my Pink ID number.

NO..tax ID is completely different and must be obtained from a Revenue Office.

The reason you are listed on your wife's tax return is because you are obviously retired and not earning any money in Thailand, and she is taking deductions for you as a dependent.

[HuaHinNew]

1 hour ago, RupertIII said:

Today's update in the Thai Enquirer, seems not just us foreigners that are concerned about all this, in particular the lack of clarity surrounding it.

https://www.thaienquirer.com/50755/opinion-thailands-ambitious-plan-to-tax-incoming-funds-risks-falling-flat-due-to-lack-of-clarity/

Thanks for the reference, much appreciated.

 

Re: Lawan Saengsanit, the Director-General of the Revenue Department, promises hearings and focus groups to clarify rules and listen to concerns. However, such afterthoughts indicate a lack of preparation and foresight, which only adds to the skepticism surrounding the initiative. Though the Revenue Department aims for clarity in the long run, the absence of it in the initial stages could be costly.

 

But, I recall reading these folks have been working on this plan for nearly 10 years, why does it lack clarity after 10 years of tossing it around.

 

Don't have much faith that in the capabilities of anyone in Thai government to get any policy near being effective or clear and concise. 

[proton]

If you go home once a year or so just bring a wad of cash back, up to 20k dollars without declaring it, or will they be taxing that as well?

[TroubleandGrumpy]

13 minutes ago, pizzachang said:

Yes, you're correct. This refers to people who regularly pay income taxes in Thailand. I imagine, it is Thai citizens, who earn money abroad and pay their taxes.  A retired citizen from another country (not a Thai or a Thai passport holder) is not a "tax resident".  

Sorry - you are wrong. Any person who resides in Thailand for more than a total of 180 days in any tax year (Jan1 to Dec31) is a tax resident of Thailand.  Freely provable with a Google search. 

[Tippaporn]

37 minutes ago, freeworld said:

I concur, govt expansion and its control and minute regulation and monitoring of everybody and the misuse of borrowings and income taxes is out of control.

I would add the outright theft of the treasury by those who have access to it.  Sure, it's not like they write treasury checks to themselves.  But in a roundabout way it finds it's way into their bank accounts.

[lordgrinz]

7 minutes ago, couchpotato said:

NO..tax ID is completely different and must be obtained from a Revenue Office.

The reason you are listed on your wife's tax return is because you are obviously retired and not earning any money in Thailand, and she is taking deductions for you as a dependent.

Yes, but her Tax ID is her Thai ID, she lists mine as the Pink ID. I am guessing the Thai Tax ID would be the same number. Would like to see someone else on here with a Pink ID and a Thai Tax ID that are different numbers. But I juust checked the return again, it literally says "Tax ID" on the document where my Pink ID is entered.

[Thaindrew]

6 minutes ago, proton said:

If you go home once a year or so just bring a wad of cash back, up to 20k dollars without declaring it, or will they be taxing that as well?

the big issue is whether if you are here for more than 180 days will they force you to do a tax return, I'd say its likely now, if you declare no funds bought to Thailand they are likely to ask questions about how you can live. If they tie in immigration and you have a "married" or "retirement" visas they are also likely to check that the funds you declare on a tax return match what you have to declare for those visas. You could though bring in with cash, atm / credit card etc funds over and above what you have to declare for your visa and that would probably go unnoticed.

[digbeth]

8 minutes ago, Thaindrew said:

a tax resident is everyone that lives here more than 180 days a year (that is clear), currently we are not "forced" to do a tax return but it sounds like we may well be as a way to assess any tax liability

You're not forced to do a return, but I suspect they have mechanism to check or report overseas transfer coming in at the bank, while there may not withhold the tax straight away, they'll certainly know if you have

 

If you think hell has broken loose here, the Thai investor in forums and facebook groups are going mad, any Thai that has enough savings worth sending abroad to invest in place with decent return will be taxed on the initial capital that went out of the country too, unless there are ways to declare money you sent abroad. 

 

When it comes in effect, I suspect instead of wiring in transfer, it'd be wiser to fly in with liquid assets like watches that can be conspicuously worn and pass through customs 

[Thaindrew]

3 minutes ago, digbeth said:

You're not forced to do a return, but I suspect they have mechanism to check or report overseas transfer coming in at the bank, while there may not withhold the tax straight away, they'll certainly know if you have

 

If you think hell has broken loose here, the Thai investor in forums and facebook groups are going mad, any Thai that has enough savings worth sending abroad to invest in place with decent return will be taxed on the initial capital that went out of the country too, unless there are ways to declare money you sent abroad. 

 

When it comes in effect, I suspect instead of wiring in transfer, it'd be wiser to fly in with liquid assets like watches that can be conspicuously worn and pass through customs 

and its interesting to note all this is based on a re-interpretation of the current law, not something that has to go through parliament, and who has the most funds outside the country that has never had tax paid ...... ?

[Dogmatix]

20 minutes ago, couchpotato said:

NO..tax ID is completely different and must be obtained from a Revenue Office.

The reason you are listed on your wife's tax return is because you are obviously retired and not earning any money in Thailand, and she is taking deductions for you as a dependent.

You have to list your spouse on your PNG 90 or PNG 91 tax return. Then there are boxes to check answering questions like do you wish to be taxed jointly or separately or did your spouse have zero income in the year.

[TroubleandGrumpy]

3 minutes ago, HuaHinNew said:

Thanks for the reference, much appreciated.

Re: Lawan Saengsanit, the Director-General of the Revenue Department, promises hearings and focus groups to clarify rules and listen to concerns. However, such afterthoughts indicate a lack of preparation and foresight, which only adds to the skepticism surrounding the initiative. Though the Revenue Department aims for clarity in the long run, the absence of it in the initial stages could be costly.

But, I recall reading these folks have been working on this plan for nearly 10 years, why does it lack clarity after 10 years of tossing it around.

Don't have much faith that in the capabilities of anyone in Thai government to get any policy near being effective or clear and concise. 

Nail on the head hit.  Because of the very strong likelihood of 'errors of interpretation' by Thai Revenue Dept Officers and/or Thai Banks, this is a massive issue for Expats in Thailand.  If it is not cleared up quickly and clearly, with the Thai Govt publicly stating that Expat's pensions and savings will not be taxed, the obvious reality is that they will be taxed.  Even if the Thai Govt did not intend that to happen, there will very likely occur situations where Expats incoming funds are 'taxed' - and the Expat will have to prove to the satisfaction of the Thai Revenue Officer (or Thai Bank Officer) that the funds were taxed in the country of origin in the previous years - which in many cases will be even more impossible than getting the owners/CEO of a foreign health insurance company to certify that their policy meets the Thai Immigration requirements (remember that??).  

 

If I bring over 5-10 million baht to buy a property, will the Thai Bank 'withhold' 30% as potential due tax?

Will the Thai Revenue Dept demand I prove the funds were taxed in order to have them released?

There are so many other potential issues/problems - and they are potentially very big ones.

 

The fact that this has happened and none in the Thai Govt has stated anything yet, gives me pause to reconsider whether living here long term is a good idea. Malaysia (Penang) is looking good right now - Plan B.

[gamb00ler]

24 minutes ago, lordgrinz said:

I assume when you mention "Thai Tax ID", at least in the case of a Farang, you mean the "Pink ID"? Because I just checked my wife's Thai Tax Return and I am listed on it with my Pink ID number.

The answer is ..... it depends.

 

If you go to the Thai Revenue department and apply for a Thai tax ID, AND you have a Pink ID number.... that number becomes (or is already) your Thai tax ID.  If you don't have a Pink ID number, the revenue department will assign you a new tax ID number.  If you subsequently get a Pink ID number it will NOT be your tax ID.  In other words... the first number you get (tax ID/Pink ID) will be your tax number.

[Moonlover]

36 minutes ago, gamb00ler said:

You have correctly named the funds withheld by banks, but the rest is not accurate.  It is attributed to the account holder (by name) even if they don't have have a Thai tax ID.  At the end of the calendar year the account holder can file a Thai tax return and most likely get all the withholding back (dependent upon other income).  If you don't like the nuisance of filing Thai income tax AND your interest income is below 20K ฿ you can apply for a Thai tax and give it to the bank(s) and request they don't withhold tax until your interest exceeds the 20K exemption.  Plus there are personal exemptions, so anybody earning less than about 200K ฿ won't pay any tax.

That's interesting to know thank you. But nonetheless it has no bearing on the topic under discussion, so we'll leave it at that if you don't mind.

[Dogmatix]

6 minutes ago, Thaindrew said:

and its interesting to note all this is based on a re-interpretation of the current law, not something that has to go through parliament, and who has the most funds outside the country that has never had tax paid ...... ?

The super wealthy like Thaksin have enough onshore wealth not to worry about this. A court decision last year returned him 18 billion of confiscated assets in what was probably a precursor deal to what we have just witnessed. Being in control of the government he can probably amass enough onshore to last his family several more generations without dipping into offshore wealth.

[lordgrinz]

4 minutes ago, gamb00ler said:

The answer is ..... it depends.

 

If you go to the Thai Revenue department and apply for a Thai tax ID, AND you have a Pink ID number.... that number becomes (or is already) your Thai tax ID.  If you don't have a Pink ID number, the revenue department will assign you a new tax ID number.  If you subsequently get a Pink ID number it will NOT be your tax ID.  In other words... the first number you get (tax ID/Pink ID) will be your tax number.

If so, and my wife has already used it as a Tax ID on her Thai tax returns, then I assume that Tax ID is now set?

[thaibreaker]

3 hours ago, Geir Rasch said:

First, there is no 183 days rule. If you stay in Thailand 180 days during a calendar year, you are a tax resident of Thailand. 
You and I must live in different realyties because most norwegians I know want to pay tax to Thailand because taxes are much lower in Thailand. I’m talking about pensions. You wil save 60K bath to 200K bath a year, depending of your pension, by paying tax to Thailand. 
It is quite straight forward to pay tax to Thailand and reclaim tax back from Norway, so I do not see the hustle about this.
For me, average tax percent to Norway would be 25%. In Thailand it is below 10% on the pension I transfer to Thailand.

You are just saying there is no 180 days rule, but in the same sentence confirming it. Seriously? Or was it the 183 (call it a typo) you were thinking about? 

 

As explained by the one I asked, you must individually compare what your tax will be in both countries. A tax from my pension, of 65.000 baht, which is very low all considered (the percentage of income is by choice for now, from 62), is in Norway 1.7 percent. That is my reality, you obviously have a different income, and so another reality. I was only comparing to the table shown in this thread, where the same income results in 20 percent tax in Thailand. That's a huge difference for me, and if I have to pay that, I can't afford living in Thailand on 65.000 baht.

 

As said, the people I know don't go through it by choice. Because they have nothing to gain from it.

But good for you if your income is a lot higher, but I still don't understand how you only can pay under 10 percent tax, in Thailand. It does not align with the table shown in this thread. 

[Dogmatix]

12 minutes ago, TroubleandGrumpy said:

Nail on the head hit.  Because of the very strong likelihood of 'errors of interpretation' by Thai Revenue Dept Officers and/or Thai Banks, this is a massive issue for Expats in Thailand.  If it is not cleared up quickly and clearly, with the Thai Govt publicly stating that Expat's pensions and savings will not be taxed, the obvious reality is that they will be taxed.  Even if the Thai Govt did not intend that to happen, there will very likely occur situations where Expats incoming funds are 'taxed' - and the Expat will have to prove to the satisfaction of the Thai Revenue Officer (or Thai Bank Officer) that the funds were taxed in the country of origin in the previous years - which in many cases will be even more impossible than getting the owners/CEO of a foreign health insurance company to certify that their policy meets the Thai Immigration requirements (remember that??).  

 

If I bring over 5-10 million baht to buy a property, will the Thai Bank 'withhold' 30% as potential due tax?

Will the Thai Revenue Dept demand I prove the funds were taxed in order to have them released?

There are so many other potential issues/problems - and they are potentially very big ones.

 

The fact that this has happened and none in the Thai Govt has stated anything yet, gives me pause to reconsider whether living here long term is a good idea. Malaysia (Penang) is looking good right now - Plan B.

These are all justifiable concerns but  more likely than withholding tax is the risk that the RD will come after you some years after the remittances with demands for back taxes, interest and penalties which they can inflate ridiculously and place the burden on you to prove otherwise. I got a demand for over 300k taxes, penalties etc from several years earlier in a corporate context. I had to spend 2 half days in the RD office going through documents with them. In the end most of their allegations proved unfounded but I had to admit to an accountant error and paid 36k.  I think I would have trouble producing documents for income earned offshore many years ago.

 

The RD’s inspector teams are under great pressure to make Yo government shortfalls in revenue and this can only get worse with the sluggish Thai and Chinese economies bd the need to fund PT’s hair brained popularist vote buying schemes.

[Thaindrew]

9 minutes ago, TroubleandGrumpy said:

Nail on the head hit.  Because of the very strong likelihood of 'errors of interpretation' by Thai Revenue Dept Officers and/or Thai Banks, this is a massive issue for Expats in Thailand.  If it is not cleared up quickly and clearly, with the Thai Govt publicly stating that Expat's pensions and savings will not be taxed, the obvious reality is that they will be taxed.  Even if the Thai Govt did not intend that to happen, there will very likely occur situations where Expats incoming funds are 'taxed' - and the Expat will have to prove to the satisfaction of the Thai Revenue Officer (or Thai Bank Officer) that the funds were taxed in the country of origin in the previous years - which in many cases will be even more impossible than getting the owners/CEO of a foreign health insurance company to certify that their policy meets the Thai Immigration requirements (remember that??).  

 

If I bring over 5-10 million baht to buy a property, will the Thai Bank 'withhold' 30% as potential due tax?

Will the Thai Revenue Dept demand I prove the funds were taxed in order to have them released?

There are so many other potential issues/problems - and they are potentially very big ones.

 

The fact that this has happened and none in the Thai Govt has stated anything yet, gives me pause to reconsider whether living here long term is a good idea. Malaysia (Penang) is looking good right now - Plan B.

it could kill the property market if applied as you state, of course if you transfer a large sum there is already anti money laundering checks but generally thats to show you did earn the money, not exactly that you paid tax on it. When you consider the current buyers of Thai property those may well have not paid tax in their home countries, and if they were taxed at such high rates when funds arrive in Thailand, the property market would collapse in terms of sales volumes or the prices drop 30%.

[thaibreaker]

3 hours ago, vibration said:

Thank you for asking this.

 

The sole reason for me doing this is because it helps me financially and is actually in my opinion very easy to do and it is also legal.

 

I only have to print out my bank statements and use a yellow marker pen to mark the International Transfers and then summarise all lf this in a list to be included in my Thai Tax Return.

 

When this is done I get the Thai Tax Office to help me fill out the Tax Return and help me to apply for a Thai Income Tax Paid Certificate and a Certificate of Residence all free.

 

When I receive the above documents I send them to my Norwegian Tax Lawyer Office in Thailand and they update my Norwegian Tax Return and send the above documents together with a letter they have drafted to the Tax Authorities in Norway.

 

The Norwegian Tax Lawyer Office in Thailand can do all of the above to facilitate this however I choose to do as much as possible myself to save money and I only have to pay 5000THB (special agreement and I have used them for many years).

 

Of course before anybody considers doing the above one must check the potenial benefits and base the decision on this.

 

In my situation it has saved me a lot of money over the years and it is legal.

 

 

Thank you for your answer. Of course, I perfectly understand if you are saving money doing so. So that makes a lot of sense. 

I only pay 1.7 percent tax in Norway on a 65.000 baht pension (by choice I take out a lower percentage of my pension for now), so I will have nothing to gain from it, quite the opposite.

 

But it all shows that for now, this is an optional thing to do, as long as Thailand is not asking or forcing anyone to do it. I guess that might change, we will see.

 

Wish you the best. Cheers.

[TroubleandGrumpy]

11 minutes ago, Dogmatix said:

These are all justifiable concerns but  more likely than withholding tax is the risk that the RD will come after you some years after the remittances with demands for back taxes, interest and penalties which they can inflate ridiculously and place the burden on you to prove otherwise. I got a demand for over 300k taxes, penalties etc from several years earlier in a corporate context. I had to spend 2 half days in the RD office going through documents with them. In the end most of their allegations proved unfounded but I had to admit to an accountant error and paid 36k.  I think I would have trouble producing documents for income earned offshore many years ago.

 

The RD’s inspector teams are under great pressure to make Yo government shortfalls in revenue and this can only get worse with the sluggish Thai and Chinese economies bd the need to fund PT’s hair brained popularist vote buying schemes.

You are right - and unlike in the 'west' where the taxation rules are clear, and usually applied consistently across Offices, and you have recourse to appeal (Tribunals etc.), and you can lodge compaints (Onbudsmen etc.) - here in Thailand things are as clear as mud, the rules are applied very inconsistently, and there is SFA recourse to appeal/complain even for a Thai citizen, let alone an Expat.  Yes the majority of Thai Govt 'officials' are OK to deal with and usually nicer than in the west, but if things end up going against you here, there is nothing you can do about it.  As you said, they will be under pressure to get more money in to pay for the Govt vote buying schemes, and being caught up in their net now or sometime in the future is a huge worry.

[Yumthai]

Those happily married to a Thai national can transfer (in this case from abroad) to their spouse up to THB 20 million in value per calendar year tax free as a gift.

[TroubleandGrumpy]

28 minutes ago, lordgrinz said:

If so, and my wife has already used it as a Tax ID on her Thai tax returns, then I assume that Tax ID is now set?

Jumping in on this issue and raising a related one - it seems to me getting and providing a Tax ID number to their Thai Bank/s might be a wise thing to do for an Expat.  In Aust if you dont provide your tax number (TFN) to a bank, they will tax all your interest earned at the highest rate, but if you give them a TFN thery apply no tax and merely report your earnings and balance to the Taxation Office.  Then it is up to you to declare the interest as income in your tax return.   Perhaps they follow the same/similar process here in Thai Banks - anyone know?

 

[thaibreaker]

2 minutes ago, Yumthai said:

Those happily married to a Thai national can transfer (in this case from abroad) to their spouse up to THB 20 million in value per calendar year tax free as a gift.

Do that, and your marriage might not be so happily ever after..

Just sayin'.

[GeorgeCross]

5 minutes ago, Yumthai said:

Those happily married to a Thai national can transfer (in this case from abroad) to their spouse up to THB 20 million in value per calendar year tax free as a gift.

that would solve many problems - do you have a link for infomation about this?

[Thaindrew]

10 minutes ago, Yumthai said:

Those happily married to a Thai national can transfer (in this case from abroad) to their spouse up to THB 20 million in value per calendar year tax free as a gift.

you could send 20m to yourself tax free before, but not going forward, don't see how that will be different for a Thai spouse, they also have a tax free threshold of 150k and these very changes are to prevent money coming from outside Thailand to Thais also tax free - if it is a loophole that could be proven its potential a lucrative agency type business

[Yumthai]

3 minutes ago, GeorgeCross said:

that would solve many problems - do you have a link for infomation about this?

https://sherrings.com/gift-tax-law-in-thailand.html

[Jingthing]

Folksies -- it's been said before but at this stage both don't panic and don't conclude this won't hit you.

We all need to WAIT!

It's as simple as that.

This situation is in process.

We've heard countries with anti double taxation treaties won't be effected by this, but alas we haven't seen anything close to final language yet!

We know what makes you a tax resident in Thailand NOW, but we don't know if they'll change that.

There is no logical reason to jump to any conclusions, positive or negative, at this time,