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

[Sheryl]

5 hours ago, NanLaew said:

If you're in Thailand for more than 180 days, yes it's taxable at a rate commensurate with how much it is. No real benefit in getting it in your Thai bank account early as far as I can see.

Actually it will depend upon the terms of the Double Taxation Agreement between the UK and Thailand, and whether he is taxed on the gain in the UK.

 

 

[beammeup]

7 hours ago, Skeptic7 said:

You're giving them way too much credit. They can't even keep track of expats residing at the same address, whom are annually extended (some providing a map!), every 90-day reported, excessive copies of address, in need of countless certicates of residence for every little thing, home visits...and a smartcar❗????

 

So they can't possibly ever keep track of tens of thousands of ATM transactions by every foreigner...some residents, some not...and then track those transactions back to precisely the correct resident...whom they've already lost track of, despite their endless reporting requirements, countless copies and certificates. They're a joke. Inept and incapable. 

Have you not heard of AI? In a short time they will be able to do many extraordinary things.

[jaideedave]

2 hours ago, Billpro785 said:

I have spoken to my accountant , a former US IRS agent and for American Expats like myself, this means nothing. As the US, and Thailand  have a tax treaty and I file US taxes every year, this will not affect me in any way. 

I would suggest the US Expats here go to the IRS website and read the tax treaty between the states and Thailand. 

According to my accountant, this was done to encourage business investments in Thailand, not to nickel and dime the expats. 

And you know that any US expats that have  more than 10K USD in Thai Baht in a Thai bank, The bank reports that to the IRS as well. 

Finally, a voice of reason. Tons of foreign countries have tax treaties with LOS. It would only confuse those who work in the Thai tax bureaucracy who paid their way to the position anyway.

[stat]

14 hours ago, K2938 said:

Thai ATMs are run by Thai banks.  And the data of Thai banks is accessible to the government if it so wishes.  So the "secret ATM withdrawal" route is unlikely to work if the government is determined enough.

If you read my post carefully you would have noticed I mentionend to use the cc of a relative, friend etc ... Not even sure if the payment of cc even satisfies the wording of the law as brought into Thailand...

[Yumthai]

Thinking out loud.

 

Agreeing that foreign income will be taxed on remittance basis, you could remit each calendar year dividend income from US stocks/ETFs.

 

As a Thai tax resident and according to DTA, US automatically applies 15% withholding tax on dividends (US non-resident alien).

 

These 15% could be offset as a tax credit from your Thai income declaration.

Tax in Thailand will be void.

 

You can calculate the amount of money you remit in order that your average tax rate in Thailand remains at 15% or lower. According to 2023 PIT rules, need to declare a bit less than 1.75 M THB (~$48K currently) basic deductions included to get that rate.

 

 

[Dogmatix]

16 hours ago, TroubleandGrumpy said:

Sorry - Wrong.  How it works is that if you have paid tax in your home country, you have 'credits' to offset any taxes applicable in Thailand. Depending on the amount involved and how it was taxed at home, you can have 'credits' that completely cover the applicable Thai taxes, or you can still have to pay the balance of the tax debt to the Thailand Revenue Dept.

 

That is very detailed and complex and hopefully the Thailand RD does not go down that path when this is implemented. Hopefully the Thai Govt will issue a blanket exemption for those countries it has a tax agreement with, and declares that any income earned overseas in those countries on funds that were never in Thailand is exempt from being assessable income.  That is the rational and practical way to do this - but Thailand tends to do things their own way.  Until they make it clear what is assessable and what is not (if they ever do), we are all in the dark. They might just go ahead and see what happens, and then deal with the outcomes - remember when they  started fining Expats 900 Baht a day when the hotel did not submit a TM30? That was eventually pulled back (even though it is the Law), but those who were fined never got their money back (or an apology). 

What you are saying is theoretically how it works but can you find the place in the PNG 90 or PNG 91 tax returns where you are supposed to input your tax credits?  I have done both PNG 90 and 91 tax returns by myself for many years and read all the guidance notes but have never seen any reference to DTA tax credits.  This is probably because under the old rules, there was no point in ever declaring any overseas income and they didn't try to track remittances.  So no one knows how they will implement this or even if there will be any guidelines issued before it comes into effect..

[stat]

7 hours ago, jas007 said:

Maybe it has already been said, but expats in Thailand receiving income from government pensions or Social Security type programs should check the provisions of the tax treaty between their country and Thailand. There may well be a section of the treaty that addresses government pensions and the like.  For example, the treaty with the USA specifically indicates that government pensions are to be taxed only in the country where earned.  It looks like Social Security benefits would be treated the same.  So, it’s simply a matter of only bringing into Thailand money from those types of sources. 
 

In my case, I get more money every month than I need, so even if I earn money from dividends or stock trading, I’ll just keep those earnings out of Thailand. I just hope I’ll be able to skip any income tax return filing in Thailand. That alone could be a pain in the neck, even if no tax is owed.

Good post! In my case Germany, TH has the right to tax the pension but they are currently not doing it so basically all germans receive their pension free. If you do not transfer your pension to TH that should be free also. So basically your appartment  gets paid by a friend or relative from abroad and you should be fairly safe. But currently we are all in the dark. This will go back and forth for months to come and the baht will slide ,so in the end we could be profitting from this law ????

[stat]

8 minutes ago, Yumthai said:

Thinking out loud.

 

Agreeing that foreign income will be taxed on remittance basis, you could remit each calendar year dividend income from US stocks/ETFs.

 

As a Thai tax resident and according to DTA, US automatically applies 15% withholding tax on dividends (US non-resident alien).

 

These 15% could be offset as a tax credit from your Thai income declaration.

Tax in Thailand will be void.

 

You can calculate the amount of money you remit in order that your average tax rate in Thailand remains at 15% or lower. According to 2023 PIT rules, need to declare a bit less than 1.75 M THB (~$48K currently) basic deductions included to get that rate.

 

 

Great post! Way to go!

[Dogmatix]

2 hours ago, Billpro785 said:

I have spoken to my accountant , a former US IRS agent and for American Expats like myself, this means nothing. As the US, and Thailand  have a tax treaty and I file US taxes every year, this will not affect me in any way. 

I would suggest the US Expats here go to the IRS website and read the tax treaty between the states and Thailand. 

According to my accountant, this was done to encourage business investments in Thailand, not to nickel and dime the expats. 

And you know that any US expats that have  more than 10K USD in Thai Baht in a Thai bank, The bank reports that to the IRS as well. 

Hopefully this will be the case but no one knows how this will be implemented and what burden of proof will be required for past tax credits which may be some years in the past.  The RD has no experience of this and will probably come up with some utterly impractical requirements.  In the same way as they announced this order without thinking it through or consulting anyone outside they will probably do the same in setting out the details.

[El Matador]

27 minutes ago, Yumthai said:

Thinking out loud.

 

Agreeing that foreign income will be taxed on remittance basis, you could remit each calendar year dividend income from US stocks/ETFs.

 

As a Thai tax resident and according to DTA, US automatically applies 15% withholding tax on dividends (US non-resident alien).

 

These 15% could be offset as a tax credit from your Thai income declaration.

Tax in Thailand will be void.

 

You can calculate the amount of money you remit in order that your average tax rate in Thailand remains at 15% or lower. According to 2023 PIT rules, need to declare a bit less than 1.75 M THB (~$48K currently) basic deductions included to get that rate.

 

 

The tax dividend in Thailand is 10%. If you already paid a withhold tax of 15% to the USA on the dividends from US stocks, basically you won't pay any extra Thai tax on your dividend and you will be able to deduct the extra 5% on your Thai income.

Can be interesting if you have some income in Thailand. But the new law won't change anything. It was already better to remit your dividend income the same year to get extra deduction on your Thai income.

 

Those who have special saving plans with no withhold tax on their dividends might need to pay the 10% to the Thai system as they can't make any deduction and those exceptions are usually never included in Tax Treaties.

[Moonlover]

On 9/19/2023 at 9:10 AM, mfd101 said:

But it does raise an interesting question for many of us, a question which those who actually are informed on this might wish to address: Assuming that (as I understand) Thailand's income tax rate is way way lower than that in any 'Western' country, why not use the double-taxation agreement from the other end? ie pay income tax in Thailand and thereby avoid the much higher rate of income tax in your home country.

Oh what a fanciful dream that is. Do you really think that any country's tax collection service could be persuaded to surrender the right to raise taxes to the benefit of another country?

 

It will snow in Singapore before that happens. ????

 

[RobU]

On 9/18/2023 at 9:57 AM, connda said:

Eventually someone is going to write, "Does that mean farang's pension income too."

Short answer would probably be "No," at least for those countries with bilateral tax agreements with Thailand.  If you're paying income tax in your home countries, then Thailand has no claim to tax the income twice.

I believe that The UK does not have a bilateral tax agreement with Thailand that is why UK pensions are frozen if you live on Thailand 

[chickenslegs]

1 minute ago, RobU said:

I believe that The UK does not have a bilateral tax agreement with Thailand that is why UK pensions are frozen if you live on Thailand 

The UK does have a double taxation treaty with Thailand

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/507424/uk-thailand-dtc180281_-_in_force.pdf

 

The pension issue is not a taxation issue. Yes, that sucks!

[RobU]

19 minutes ago, chickenslegs said:

The UK does have a double taxation treaty with Thailand

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/507424/uk-thailand-dtc180281_-_in_force.pdf

 

The pension issue is not a taxation issue. Yes, that sucks!

Thanks for the info it puts my mind at rest. Panic over, whew!

[david555]

30 minutes ago, chickenslegs said:

The UK does have a double taxation treaty with Thailand

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/507424/uk-thailand-dtc180281_-_in_force.pdf

 

The pension issue is not a taxation issue. Yes, that sucks!

Thai revenue site , double taxation treaty country's

 

Last updated: 14.10.2021

https://www.rd.go.th/english/766.html

[TroubleandGrumpy]

16 hours ago, stat said:

Your bank in the us or Europe is not exchanging data on how much money you have withdrawn from your bank account and brought into Thailand. Only money brought into Thailand could be taxed by Thailand.

That is correct, but I will point out that as a tax resident of Thailand you could be liable for tax on money/income earned overseas, and it is very much subject to whatever tax agreement exists between the 2 countries.

US Citizens are different - they are obliged to pay income tax to USA on any earnings/income they make anywhere in the world. The USA is the only country that I know that gets away with that.

[TroubleandGrumpy]

16 hours ago, stat said:

Maybe consider using credit card to withdraw cash 33x30.000 Baht and you "should" be under the radar. Additional layer of security, use someone elses credit card (family member that does not live in Thailand if possible). I know not allowed by cc companies...

There are a lot of ways to avoid being required to pay liable taxes - including those you mention and others like using ATMs.  But if 'caught' one day in the future, and they start an investigation, it can all be backdated. 

[TroubleandGrumpy]

11 hours ago, Tippaporn said:

My current sentiment is "much ado about nothing."  It's not by any means the first idiotic scheme cooked up by the Thai government to be reversed rather quickly after they experience the disastrous results.

Take a close look at my avatar.  The dog is nowhere to be found and the cat understands well.  The cat does not react to imaginary situations but does react to very real ones.  As an analogy, up to now this is the Thai government posting the "Beware of the dog" sign.  I'll deal with it when an actual symbolic dog appears.

Colour me stupid or colour me wise.

 

I would say a bit of both - it is all good until the dog wakes up and sees you  ????

But I tend to agree that it will soon be sorted out one way or the other - I just hope it is soon.

Meanwhiloe I will look into it all and see what impacts it would have if it did affect me - so far it is not good for me. I have investments in Australia that make earnings/income and technically I am liable to pay income tax on that to Thailand - depending on the tax agreement between Australia and Thailand as to who gets the first 'go at it'.  

[TroubleandGrumpy]

1 hour ago, Dogmatix said:

What you are saying is theoretically how it works but can you find the place in the PNG 90 or PNG 91 tax returns where you are supposed to input your tax credits?  I have done both PNG 90 and 91 tax returns by myself for many years and read all the guidance notes but have never seen any reference to DTA tax credits.  This is probably because under the old rules, there was no point in ever declaring any overseas income and they didn't try to track remittances.  So no one knows how they will implement this or even if there will be any guidelines issued before it comes into effect..

Yes you are right - and it is one of the reasons why the Thai RD has not previously enforced this requirement. One guy said he went into his local Office of the RD and asked how he can do his personal income tax returns. They went 'Mai Mai' and he was told to 'go away'.  It is too hard to do in Thailand - it requires accountants and a business etc. -The Thjai RD personal income tax systems and processes are not setup for this - too hard. 

 

And you are VERY right about no one knowing how they will implement this - they (RD) dont know. They are not prepared at all and it would probably take them 2 years to get their systems and processes right - and even then they will screw it up. 

 

Remember when they decided to 'enforce' TM30/TM28 laws? After several months they finally backed down and stopped it following the massive backlash from Expats.  But no one who got caught and paid the 900 Baht fines was ever refunded, and none received an apology.

[stat]

1 hour ago, El Matador said:

The tax dividend in Thailand is 10%. If you already paid a withhold tax of 15% to the USA on the dividends from US stocks, basically you won't pay any extra Thai tax on your dividend and you will be able to deduct the extra 5% on your Thai income.

Can be interesting if you have some income in Thailand. But the new law won't change anything. It was already better to remit your dividend income the same year to get extra deduction on your Thai income.

 

Those who have special saving plans with no withhold tax on their dividends might need to pay the 10% to the Thai system as they can't make any deduction and those exceptions are usually never included in Tax Treaties.

Your remittance into TH will be taxed as ordinary income with a top rate of 35%. They should credit you the 15% though, anything over 15% according to the income brackets you pay. Withholding tax of 10% for TH dividends does not come into play here.

[TroubleandGrumpy]

14 hours ago, ukrules said:

They're going to be coming for the wealthy Thais way before they come after us lot.

You are right - but - when a Govt Dept starts a process to do something (go after wealthy Thais) they will throw a 'wide net'. The issue is that they have no control over who they 'catch' in that net.  They cannot legally just pick a list of wealthy Thais and start investigating them - they have to appear in their 'net' - and then they can investigate.  Will they ignore any of us caught in the net (too small - throw back) - hopefully they will.

 

Avoiding taxation problems does not require ignoring them, and assuming they will not apply.  I have found that over the years the best way is as follows. 

1. Learn exactly what the rules/regs are and how they could apply to you (or pay someone to tell you).

2. Learn exactly how the Revenue Dept is going to catch people (or pay someone to tell you). 

Then you take actions to mitigate or avoid both 1 and 2 - or do what the expert says.

The wealthy and rich pay good money to tax experts to do that for them.

We could pay a tax expert to do it - or we can do it ourselves.

If I was in Australia I would talk to one of the many accountants availble to ordinary people.

But in Thailand all the good tax experts are going to be busy for a while.

[TroubleandGrumpy]

4 hours ago, Billpro785 said:

I have spoken to my accountant , a former US IRS agent and for American Expats like myself, this means nothing. As the US, and Thailand  have a tax treaty and I file US taxes every year, this will not affect me in any way. 

I would suggest the US Expats here go to the IRS website and read the tax treaty between the states and Thailand. 

According to my accountant, this was done to encourage business investments in Thailand, not to nickel and dime the expats. 

And you know that any US expats that have  more than 10K USD in Thai Baht in a Thai bank, The bank reports that to the IRS as well. 

Australian pensions are not taxed in Thailand under the Double Taxed Agreement

Australia | The Revenue Department (English Site) (rd.go.th)

 

The USA DTA is different from all other countries because of the USA requirement that most US citizens report and pay taxes to USA wherever they are living/working and earning that income. 

 

[mokwit]

39 minutes ago, TroubleandGrumpy said:

Remember when they decided to 'enforce' TM30/TM28 laws? After several months they finally backed down and stopped it following the massive backlash from Expats.

No i don't remember them backing down on TM30, neither do the IO's enforcing it at extension time.

[Tippaporn]

41 minutes ago, TroubleandGrumpy said:

I would say a bit of both - it is all good until the dog wakes up and sees you  ????

But I tend to agree that it will soon be sorted out one way or the other - I just hope it is soon.

Meanwhiloe I will look into it all and see what impacts it would have if it did affect me - so far it is not good for me. I have investments in Australia that make earnings/income and technically I am liable to pay income tax on that to Thailand - depending on the tax agreement between Australia and Thailand as to who gets the first 'go at it'.  

Prudence dictates.  I understand.  But there's a part of me that believes in self fulfilling prophesies.  I've had some experiences with those . . .

Ultimately the only thing of importance is acting in accordance with whatever one believes is best for them.  My advice is certainly not a one-size-fits-all solution.

On the part of all is well until the dog arrives; I'd already be long gone.  There's kinda a trick to that.  Ask any cat. 

[mokwit]

3 minutes ago, Tippaporn said:

On the part of all is well until the dog arrives; I'd already be long gone.  There's kinda a trick to that.  Ask any cat. 

Stall and flee in the night rather than attend and get a Thai version of the Old Bills: "it's just a routine inquiry, Sir, do you have your passport with you, Sir?"

[Madgee]

9 hours ago, lordgrinz said:

This is where I think my Pink ID comes in handy, it has my name in both Thai and English and they actually use my Pink ID number on the license, not my Passport number. Even my bank account at SCB is linked to the Pink ID. My wife uses that Pink ID for almost everything, renewing insurance for me, medical, etc,

Your Pink ID card has your name in English on it? ...... How unique.
Not one word of English on mine! 

[transam]

9 hours ago, lordgrinz said:

This is where I think my Pink ID comes in handy, it has my name in both Thai and English and they actually use my Pink ID number on the license, not my Passport number. Even my bank account at SCB is linked to the Pink ID. My wife uses that Pink ID for almost everything, renewing insurance for me, medical, etc,

No English on mine...................????

[Tippaporn]

20 minutes ago, mokwit said:

Stall and flee in the night rather than attend and get a Thai version of the Old Bills: "it's just a routine inquiry, Sir, do you have your passport with you, Sir?"

It's more of a case of not letting trouble find you.  It has something to do with your sixth sense. 

[transam]

10 hours ago, Skeptic7 said:

You're giving them way too much credit. They can't even keep track of expats residing at the same address, whom are annually extended (some providing a map!), every 90-day reported, excessive copies of address, in need of countless certicates of residence for every little thing, home visits...and a smartcar❗????

 

So they can't possibly ever keep track of tens of thousands of ATM transactions by every foreigner...some residents, some not...and then track those transactions back to precisely the correct resident...whom they've already lost track of, despite their endless reporting requirements, countless copies and certificates. They're a joke. Inept and incapable. 

But, it could all be required at extension time, with another zillion sheets of A4.........????

[Yumthai]

2 hours ago, El Matador said:

The tax dividend in Thailand is 10%.

The tax dividend in Thailand is 10% for any dividend income from listed or limited companies in Thailand, not foreign companies.