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

[redwood1]

3 minutes ago, John Drake said:

My tax office isn't too far away. I haven't got anything else to do. So, if the time comes when I need to prove no tax payment, I will be the one doing the delaying, scheduling, and endlessly explaining. I will spend days, even weeks, getting the tax people to detail, examine, refer, cite, and detail my return. I'll clog up their system.

So whats the deal is immigration going to all the sudden be experts on international tax law?........These folk will be absolutely snowed under on the first hour of the first day..

[John Drake]

Just now, redwood1 said:

So whats the deal is immigration going to all the sudden be experts on international tax law?........These folk will be absolutely snowed under on the first hour of the first day..

From what I've seen in the past, Immigration doesn't like other departments encroaching on their turf or causing them more work. They might fight the imposition of tax documentation into their rules, (which also need to be certified by legislative acts, don't they?), and be something they will resist more than we do.

[beammeup]

I can understand taxing remittances used for living expenses, but having to pay an income tax to purchase property, condo's vehicles etc? People will just choose not to. this will be a downer on the economy.

[Lorry]

8 minutes ago, TroubleandGrumpy said:

Thai tax payable on 65K per month (980K PA) is about 70K Baht. 

If you are over 65, and IF they grant you the same allowance as Thais, 

there is another allowance of 190,000. That would result in about 40k tax.

There even is an allowance of 100,000 for pensions, but they will probably say "only Thai pensions"

 

BTW it's 780K, not 980K

[placnx]

20 hours ago, MartinBangkok said:

Yes, but the thing is, the Chinese are coming, and in big numbers. 5 years from now, the Chinese will have bought all available condos (anything to get out of Xi's China). Thaksin is half Chinese, as are most of the Thailand elite. Chinese are welcome, people with white skin from developed democratic nations, are not. We are the Thai elites worst enemy, indusing  democratic thoughts into our Thai spouses, girlfriends, lovers, friends. 

Maybe it will be many young Taiwanese escaping Xi's grasp.

[placnx]

19 hours ago, StayinThailand2much said:

Many Chinese want their money to leave China due to problems with banks there. Perhaps they heard about that in Thai government and want to cash in on it.

It's not so easy as before to get money out of China.

[placnx]

17 minutes ago, beammeup said:

I can understand taxing remittances used for living expenses, but having to pay an income tax to purchase property, condo's vehicles etc? People will just choose not to. this will be a downer on the economy.

The solution for those who can is to send the condo money before becoming a resident. For clarity, then opening a new bank account to use as resident might help.

[Lorry]

4 minutes ago, placnx said:

Maybe it will be many young Taiwanese escaping Xi's grasp.

Thailand has long made it very difficult for young Taiwanese to live here. It used to be easy.  Now Thailand prefers they go home.

Guess why?

[Sheryl]

4 hours ago, Maestro said:

 

The emphasis is on assessable income. The recent Revenue Department Order No. 161/2566 is about income earned abroad, ie outside Thailand, that is assessable in Thailand. 

 

If there is a Double Taxation Agreement (DTA) between Thailand and another country and if this DTA states that some income in that other country is assessable in that country, then that income is not assessable in Thailand. That's the purpose of a DTA, and it works both ways.

 

For the record, here is an English translation of the entire text of the Revenue Department Order No. 161/2566

Revenue Department Order 161-2566.pdf 177.74 kB · 14 downloads

 

And here is a link to the original Thai text of the Order, included in the news article linked to in the OP of this topic:

https://www.thaienquirer.com/wp-content/uploads/2023/09/IMG_3943.jpg

Thank you for this. Absolutely correct. It all depends upon:

 

1) what is considered Assessable Income  and

2) The terms of any applicable DTA.

 

I have no idea if accurate but this site states that there was a Revenue Department ruling in 2003 stating that savings brought into the country by foreign residents are not  assessable income  https://sherrings.com/assessable-income-foreign-sources-thailand.html

I have been unsuccessful in locating source if this statement.  If anyone can, would be very helpful as the savings issue is a key one for many expats.

 

Same site states that the RD 2003 tax ruling declared pension income brought in by foreigners to be Assessable. However   in at least some cases that will be superseded by terms of DTA. For example the US DTA clearly exempts Social Security and Government pensions (but nto private pensions) from taxation in Thailand. For that matter the terms of the US DTA would class many, perhaps most,  expats as residents of US only for tax purposes but that is an anomaly in that the US taxes its nationals based on nationality, not residence, with the result that 100% of US citizens re US residents for tax purposes while also, if in Thailand for more than 180 days,  Thai residents for tax purposes, leading to provisions on determining residence under the Tx treaty to come into play. These are complex  but largely hinge on where you have a "permanent resident available to you" which I would think means own a home, and also in which country your  "personal and economic relations are closer".  In countries where taxation is based on residence, leading an expat to be non-resident of their country for tax purposes, matters would be different.

[Yumthai]

7 minutes ago, Sheryl said:

1) what is considered Assessable Income

Translation of the new rule:

Section 1: A person who is Persons residing in Thailand according to Section 41, paragraph three, of the Revenue Code who have assessable income due to work duties or activities conducted abroad or because the property is in Foreign countries according to Section 41, paragraph two of the Revenue Code In the said tax year and took that assessable income Entering Thailand in any tax year That person has a duty to include that assessable income in the calculation. To pay income tax according to Section 48 of the Revenue Code In the tax year in which the assessable income was brought in in Thailand.

 

It's clear to me that some types of assessable income have been specifically defined in the order, thus logically not including all the types listed in Section 40 of Thailand's Revenue Code.

 

[Lorry]

18 minutes ago, Sheryl said:

this site states that there was a Revenue Department ruling in 2003 stating that savings brought into the country by foreign residents are not  assessable income  https://sherrings.com/assessable-income-foreign-sources-thailand.html

First, this ruling is from August 1, 2023. We have a new government now.

 

Second, this site also states that pensions brought into Thailand ARE taxable. So the rest of your post resp. a DTA applies. But you can see from the length of your own post how complicated this is going to be. Starting with the proof that your remittance is from savings,  not from your pension. 

So pay up (a couple of thousand US, see above), hire a tax adviser (the guy in the video posted above says with his firm it will result in taxes of only  a couple of thousand US if his firm does it) or spend 30% of your time in Thailand with the RD.

[Dogmatix]

1 hour ago, John Drake said:

My tax office isn't too far away. I haven't got anything else to do. So, if the time comes when I need to prove no tax payment, I will be the one doing the delaying, scheduling, and endlessly explaining. I will spend days, even weeks, getting the tax people to detail, examine, refer, cite, and detail my return. I'll clog up their system.

No you won’t. They will just look at your foreign documents and tell you to get them notarized at the Foreign tax office and the Thai embassy in your country, then translated and notarized at the Thai foreign ministry. When you have finished that, they will look at the translations and say Mai Tai Kha. Then you pay tax at the full rate without tax credit deductions and interest and penalties, if late. You may be blocked from leaving the country and renewing your visa, if you don’t pay on time.

[Lorry]

8 minutes ago, Yumthai said:

Translation of the new rule:

Section 1: A person who is Persons residing in Thailand according to Section 41, paragraph three, of the Revenue Code who have assessable income due to work duties or activities conducted abroad or because the property is in Foreign countries according to Section 41, paragraph two of the Revenue Code In the said tax year and took that assessable income Entering Thailand in any tax year That person has a duty to include that assessable income in the calculation. To pay income tax according to Section 48 of the Revenue Code In the tax year in which the assessable income was brought in in Thailand.

 

It's clear to me that some types of assessable income have been specifically defined in the order, thus logically not including all the types listed in Section 40 of Thailand's Revenue Code.

 

Very well noticed. 

So pensions would not be taxable, I wrote my last post for what??

It remains the problem of proof.

[Lorry]

3 minutes ago, Dogmatix said:

No you won’t. They will just look at your foreign documents and tell you to get them notarized at the Foreign tax office and the Thai embassy in your country, then translated and notarized at the Thai foreign ministry. When you have finished that, they will at the translations and say Mai Tai. Then you pay tax at the full rate without tax credit deductions and interest and penalties, if late. You may be blocked from leaving the country and renewing your visa, if you don’t pay on time.

Best explanation of what is going to happen. 

[vukovar77]

On 9/18/2023 at 11:58 AM, Jenkins9039 said:

Kinda irrelevant, anyone more than 183 days in Thailand will have to have paid tax or will pay tax based on their expenditure within Thailand based on remittances to Thailand...

 

It makes it a non-attractive country whereby Thailand has just gifted the golden goose to its neighbours.

 

As the vast majority of remittances for the average expat are 'small' compared to the average remittances from high-income expats that usually previously resided in Tax havens, who will now have to pay tax for the luxury of living in THailand and spending 500-2m THB a month + 35% tax.

 

They will just go elsewhere.

 

 

Well,sure,big remittances will probably stop from high-income expats .Taxing pensions double if tax is aready payed in home country is very bad deccision ,from my point of view.It is not law yet so we will see.Maybe they will exempt pensions lower than 50-60 K BHT or so.But if burden will be heavy ,expats probably decide  will live here less than 180 days or live elsewhere like Cambodia,Phillipines,Vietnam,Indonesia or so.Maybe even Spain,Portugal or Mexico will be more desirable to live in.I have condo here and Thai wife so need to calculate every option.Big money earners from stock markets all around the world will probably decide lo leave money abroad.I love this country and it was great to live here ,but not to invest here ,cos many restrictions for expats already exsisting .I hope they will not impose this law.

[Dogmatix]

20 minutes ago, Lorry said:

First, this ruling is from August 1, 2023. We have a new government now.

 

Second, this site also states that pensions brought into Thailand ARE taxable. So the rest of your post resp. a DTA applies. But you can see from the length of your own post how complicated this is going to be. Starting with the proof that your remittance is from savings,  not from your pension. 

So pay up (a couple of thousand US, see above), hire a tax adviser (the guy in the video posted above says with his firm it will result in taxes of only  a couple of thousand US if his firm does it) or spend 30% of your time in Thailand with the RD.

The latest ruling says any prior rulings that contradict it are rescinded. Thus the 2023 ruling that overseas savings are not taxable could be deemed as rescinded. Savings are prior years earnings which the latest duly says are taxable without time limit.

[redwood1]

8 minutes ago, vukovar77 said:

Well,sure,big remittances will probably stop from high-income expats .Taxing pensions double if tax is aready payed in home country is very bad deccision ,from my point of view.It is not law yet so we will see.Maybe they will exempt pensions lower than 50-60 K BHT or so.But if burden will be heavy ,expats probably decide  will live here less than 180 days or live elsewhere like Cambodia,Phillipines,Vietnam,Indonesia or so.Maybe even Spain,Portugal or Mexico will be more desirable to live in.I have condo here and Thai wife so need to calculate every option.Big money earners from stock markets all around the world will probably decide lo leave money abroad.I love this country and it was great to live here ,but not to invest here ,cos many restrictions for expats already exsisting .I hope they will not impose this law.

I bet the money lost through a tax would be at a minumn 100 to 1.......That is for every dollar gained from a tax 100 dollars would be lost from not spending......Heck it could even be a 1000 to 1 for all I know.....

[Dogmatix]

24 minutes ago, Lorry said:

Very well noticed. 

So pensions would not be taxable, I wrote my last post for what??

It remains the problem of proof.

The RD ruled that overseas pensions are taxable in Thailand in 2023. I don’t see any wording in the latest order rescinding that. So they are still taxable, even if not specifically listed.

[vukovar77]

On 9/18/2023 at 11:19 AM, NoDisplayName said:

Okay, fine. 

 

There is no minimum time spent in Thailand required to maintain a "retirement" visa extension.  I can keep my 800K in the bank, spend 181 days in other countries, and send my Wise transfers to a Cambodian bank account.  Can carry my Thai spending money in my wallet on frequent visits.

 

No, wait........why AM I going to all this trouble?

Only check out before what will happen with your money on Cambodian bank account if you leave conuntry ???

[John Drake]

This topic has generated the most intense immigration doom porn since the health insurance requirements during covid.

[Dogmatix]

1 hour ago, John Drake said:

From what I've seen in the past, Immigration doesn't like other departments encroaching on their turf or causing them more work. They might fight the imposition of tax documentation into their rules, (which also need to be certified by legislative acts, don't they?), and be something they will resist more than we do.

Immigration was very happy handling tax clearance certificates!from the RD  when needed them to leave the country. I think they would be delighted to tell people they can’t renew their visas without a tax clearance document. Any reason to tell foreigners they don’t have the correct documents is welcome.

[DudleySquat]

Not one person here has asked the proper question: What is a tax resident?

[vukovar77]

1 minute ago, DudleySquat said:

Not one person here has asked the proper question: What is a tax resident?

Everyone live here 1800 days or more per year.

[vukovar77]

13 minutes ago, Dogmatix said:

The RD ruled that overseas pensions are taxable in Thailand in 2023. I don’t see any wording in the latest order rescinding that. So they are still taxable, even if not specifically listed.

Yeah,if tax is not payed in your home country and pension is remitted to thailand in year it is earned.

[mokwit]

35 minutes ago, Dogmatix said:

No you won’t. They will just look at your foreign documents and tell you to get them notarized at the Foreign tax office and the Thai embassy in your country, then translated and notarized at the Thai foreign ministry. When you have finished that, they will look at the translations and say Mai Tai Kha. Then you pay tax at the full rate without tax credit deductions and interest and penalties, if late. You may be blocked from leaving the country and renewing your visa, if you don’t pay on time.

It will have to be in a form that front desk staff can understand. How did they handle health insurance? Seems you had to have some declaration from your insurance company that they likely wouldn't provide, so alternatively you could buy the Thai insurance.

 

They will probably ask for the amounts and sources to be certified by your embassy or some other body who will say we are not in the business of certifying that.

[vukovar77]

2 minutes ago, vukovar77 said:

Everyone live here 1800 days or more per year.

Sorry,180 days.

[mokwit]

Key point in the Bangkok Post letter. Foreign investors will become very leery if statutes/investment legal framework is being changed at the stroke of a Ministry pen. As he points out, they are written vaguely so they can be interpreted as the authorities see fit.

 

 

[mokwit]

10 minutes ago, DudleySquat said:

Not one person here has asked the proper question: What is a tax resident?

Someone who stayed on after this change was introduced.

[Dogmatix]

Many people are saying stay cool and wait for the fine print. But what if there are no more details by 1 Jan?
 

I think that is a quite a possible scenario. It is not a change in the law. They have just decided the law means something different from they last said it meant in 1987 because, well, times changed and the meaning of language changes too, right? So no obligation for for the detailed guidelines and seminars that might be expected to explain a new law because this is still the old law. 
 

After 1 Jan they might throw out a few tit bits of information on how they see what is taxable. But if they allow themselves to get drawn into discussions before then, they risk having to delay which Srettha will not want to do because he is under pressure to show he will tax the rich to fund PT’s popularist schemes. And once the deadline is past they have more bargaining power with taxpayers. It’s quite possible we have to do the first tax returns by 31 March 2025 under this reinterpretation with little more guidance than we have now.

[Mike Teavee]

2 hours ago, TroubleandGrumpy said:

Unlike Singapore where their bureaucrats are a lot better educated and trained (not saying they are great), in Thailand they are often under-educated and very badly 'trained'. If the Thai Govt was to continue down this path (becoming like Singapore in taxation enforcement),

Singapore doesn't Tax Expats on your typical overseas income (Pensions, Dividends, Rental Income, Capital Gains etc). whether you bring the money into the country or not (You can have it directly paid into your SG Bank Account, still not taxible)...

 

https://www.iras.gov.sg/taxes/individual-income-tax/basics-of-individual-income-tax/what-is-taxable-what-is-not/income-received-from-overseas

 

 

In fact, Thailand following the same model as Singapore would remove the need not to bring the money into the country in the same Tax year so would be better for us ????  

 

 

But I do agree, filing/paying Taxes in Singapore is an absolute doddle (plus you don't need to pay any of it until the May of the next year) & it would be great if Thailand was as easy... I completed a return for repayment of withholding tax on interest on my bank accounts in Feb, been shown as complete since April, still no sign of the cash & I won't be putting my head about the parapet to chase it now.