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

[stat]

44 minutes ago, Misty said:

No, sorry but that is not correct.  Three of the LTR visas DO exempt foreign income transferred into Thailand from Thai tax.  Only one visa does not:  LTR HSP. 

 

 

 

 

Pls show me the exact wording where it is stipulated that income transferred is tax exempt. It is only stated that income generated from overseas is tax exempt, no mentioning of transfered income to Thailand IMHO. Thanks!

Edited September 25, 2023 by stat

[sathornlover]

1 hour ago, stat said:

I just checked about gift tax in TH. Up to 100 Million Baht in gifts that they our relatives send us we are on the safe side. That should be sufficient for most of us folks here ????

 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Introduction-of-Inheritance-and-Gift-Tax

How should this “gift” be made by a foreigner in Thailand as a “tax resident” to his Thai spouse without the Revenue Department deeming this gift as tax avoidance. These monetary gifts can also be transferred from the donor's foreign account to the spouse's Thai bank account on a regular basis every 1-12 months? Are these types of donations subject to reporting and if so, by whom and in what form?

 

I'm a bit skeptical...

[ukrules]

1 hour ago, jonny on the spot said:

So someone can gift me 99 million tax free?

Maybe, but I bet the sender must have already paid tax in Thailand on that money and it can't come from a foreign bank account.

 

Edited September 25, 2023 by ukrules

[Misty]

38 minutes ago, stat said:

Pls show me the exact wording where it is stipulated that income transferred is tax exempt. It is only stated that income generated from overseas is tax exempt, no mentioning of transfered income to Thailand IMHO. Thanks!

I received written confirmation from the LTR unit by email today.   However, you can also check out this English translation of Royal Decree  No. 743) B.E. 2565 (2022). See Section 5. https://ltr.boi.go.th/documents/Royal-Decree-743.pdf

 

Section 5 Income tax under Part 2 of Chapter 3 in Title 2 of the Revenue Code shall be exempted for a foreigner categorised as Wealthy Global Citizen, Wealthy Pensioner, or Work-from-Thailand Professional who is granted a Long-Term Resident Visa under immigration law for assessable income under section 40 of the Revenue Code derived in the previous tax year from an employment, or from business carried on abroad, or from a property situated abroad, and brought into Thailand.

[stat]

37 minutes ago, sathornlover said:

How should this “gift” be made by a foreigner in Thailand as a “tax resident” to his Thai spouse without the Revenue Department deeming this gift as tax avoidance. These monetary gifts can also be transferred from the donor's foreign account to the spouse's Thai bank account on a regular basis every 1-12 months? Are these types of donations subject to reporting and if so, by whom and in what form?

 

I'm a bit skeptical...

I am not an expert on this subject matter, but in general the gift in itself is tax free. However if you then proceed to use the funds yourself then yes this could be tax avoidance...

[stat]

11 minutes ago, Misty said:

I received written confirmation from the LTR unit by email today.   However, you can also check out this English translation of Royal Decree  No. 743) B.E. 2565 (2022). See Section 5. https://ltr.boi.go.th/documents/Royal-Decree-743.pdf

 

Section 5 Income tax under Part 2 of Chapter 3 in Title 2 of the Revenue Code shall be exempted for a foreigner categorised as Wealthy Global Citizen, Wealthy Pensioner, or Work-from-Thailand Professional who is granted a Long-Term Resident Visa under immigration law for assessable income under section 40 of the Revenue Code derived in the previous tax year from an employment, or from business carried on abroad, or from a property situated abroad, and brought into Thailand.

Thanks a lot of the link. Capital income falls under which chapter in the Thai law? I do not know It is mentioned previous tax year only. In addition as is mentioned in the new law all other laws are null and void if I remember correctly; IMHO this could imply that also a potential tax exemption in the LTR is void. However I hope you are in the right on this subject, but just can't read it out of the laws.

Edited September 25, 2023 by stat

[redwood1]

Page 47 only 3 more to 50........Lets get posting......

[Misty]

14 minutes ago, stat said:

Thanks a lot of the link. Capital income falls under which chapter in the Thai law? I do not know It is mentioned previous tax year only. In addition as is mentioned in the new law all other laws are null and void if I remember correctly; IMHO this could imply that also a potential tax exemption in the LTR is void. However I hope you are in the right on this subject, but just can't read it out of the laws.

Confirmation today from LTR unit by email. 

 

I haven't seen a new tax law only a Thai internal RD directive.  Can you post a link to the new law?

[Felt 35]

1 hour ago, sathornlover said:

How should this “gift” be made by a foreigner in Thailand as a “tax resident” to his Thai spouse without the Revenue Department deeming this gift as tax avoidance. These monetary gifts can also be transferred from the donor's foreign account to the spouse's Thai bank account on a regular basis every 1-12 months? Are these types of donations subject to reporting and if so, by whom and in what form?

 

I'm a bit skeptical...

So am I and best to get that gift away before New Year is my thinking.????

Felt 

[stat]

2 hours ago, Felt 35 said:

Seems thankfully its only money from whatever brought into Thailand so then assets /interest abroad should stay clear from being taxable in Thailand.

 

Thailand Foreign Source Income Personal Tax - SHERRINGS

This is a big big plus, however you have to transfer money inside Thailand to pay your expenses. Now how to determine if 100% of you remittance is taxable or "only" the 5% profit you made.

[stat]

2 minutes ago, Felt 35 said:

So am I and best to get that gift away before New Year is my thinking.????

Felt 

Nope, you are best off transferring a lot of your money into Thailand this year if you intent to stay here and are confident that you can withdraw your money later. The "gifts" should be send in later ????

[stat]

1 hour ago, Misty said:

Confirmation today from LTR unit by email. 

 

I haven't seen a new tax law only a Thai internal RD directive.  Can you post a link to the new law?

 

You are correct that it is not a law but a directive, my apologies!

 

But as mentioned in the directive, all older directives are void as is also stated by a very reputable law firm.

 

According to the New Order, if Thai tax resident individuals derive offshore-sourced income and bring offshore-sourced income into Thailand, they will have to pay Thai personal income tax, regardless of whether such income is brought into Thailand in the calendar year of receipt or in subsequent calendar years. The New Order will apply to any taxable income that is brought into Thailand from 1 January 2024 onward. Any regulation, instruction, revenue ruling or practice which is contrary to or inconsistent with this New Order shall be repealed.

It is noteworthy that if the offshore-sourced income is not a taxable income (e.g., proceeds from the sale of offshore securities or assets with no gain) or income that is exempted from Thai personal income tax under the Revenue Code, such as income from insurance, Thai tax residents will not have to pay Thai personal income tax when they bring that income into Thailand.

 

Source: https://insightplus.bakermckenzie.com/bm/tax/thailand-offshore-sourced-income-brought-into-thailand-from-1-january-2024-onward-will-be-subject-to-thai-personal-income-tax/

 

 

Also here:

 

Article 2: In line with the issuance of this order, all existing rules, regulations, orders, responses to inquiries, or any practices that contradict or oppose the provisions laid out in Order No. 16/2023 shall be void.

 

 

https://franklegaltax.com/thailands-new-tax-rules-reporting-foreign-income-for-residents/?lang=de

Edited September 25, 2023 by stat

[Srikcir]

3 hours ago, stat said:

I just checked about gift tax in TH. Up to 100 Million Baht in gifts that they our relatives send us we are on the safe side. That should be sufficient for most of us folks here ????

 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Introduction-of-Inheritance-and-Gift-Tax

Gift tax is not an income tax.

From Mazars tax rate in 2023 for yearly employment income and hire of work range from exempt for less than 150,000 THB to 35% for 5 million and over. 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Payroll/Personal-Income-Tax

 

[stat]

16 minutes ago, Srikcir said:

Gift tax is not an income tax.

From Mazars tax rate in 2023 for yearly employment income and hire of work range from exempt for less than 150,000 THB to 35% for 5 million and over. 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Payroll/Personal-Income-Tax

 

Missunderstanding: Where was it stated that Gift tax is an income tax? I brought gift tax up for a workaround. It might be a work around to reveice gifts from abroad in order to not pay income tax and gifts are not taxable (up to 100M).

Edited September 25, 2023 by stat

[hwas]

1 hour ago, stat said:

 

You are correct that it is not a law but a directive, my apologies!

 

But as mentioned in the directive, all older directives are void as is also stated by a very reputable law firm.

 

According to the New Order, if Thai tax resident individuals derive offshore-sourced income and bring offshore-sourced income into Thailand, they will have to pay Thai personal income tax, regardless of whether such income is brought into Thailand in the calendar year of receipt or in subsequent calendar years. The New Order will apply to any taxable income that is brought into Thailand from 1 January 2024 onward. Any regulation, instruction, revenue ruling or practice which is contrary to or inconsistent with this New Order shall be repealed.

It is noteworthy that if the offshore-sourced income is not a taxable income (e.g., proceeds from the sale of offshore securities or assets with no gain) or income that is exempted from Thai personal income tax under the Revenue Code, such as income from insurance, Thai tax residents will not have to pay Thai personal income tax when they bring that income into Thailand.

 

Source: https://insightplus.bakermckenzie.com/bm/tax/thailand-offshore-sourced-income-brought-into-thailand-from-1-january-2024-onward-will-be-subject-to-thai-personal-income-tax/

 

 

Also here:

 

Article 2: In line with the issuance of this order, all existing rules, regulations, orders, responses to inquiries, or any practices that contradict or oppose the provisions laid out in Order No. 16/2023 shall be void.

 

 

https://franklegaltax.com/thailands-new-tax-rules-reporting-foreign-income-for-residents/?lang=de

The LTR exemption is not based upon a directive, order, rule, regulation, response to inquiries or other practices, it is a Royal Decree.  You seem to have a fixation with this.  If you do not have an LTR, why do you care? Better to spend your time looking for other workarounds, like gifts.

[Dogmatix]

4 hours ago, stat said:

I just checked about gift tax in TH. Up to 100 Million Baht in gifts that they our relatives send us we are on the safe side. That should be sufficient for most of us folks here ????

 

https://www.mazars.co.th/Home/Insights/Doing-Business-in-Thailand/Tax/Introduction-of-Inheritance-and-Gift-Tax

That is inheritance tax.  The gift tax kicks in at 20 million for gifts from direct family and 10 million from others.  I am not sure how frequently you can receive gifts from the same donor.

[K2938]

12 hours ago, Hummin said:

For most my best guess, it will continue as it have done, but for those who already have tax number, it will be easier to squise a few more baht from. 

 

The very same who claimed a tax number on long stay visa, have done it to save paying tax to their orign country. 

 

It is a very good reminder, that what we have today, might not continue the same way in future. 

Currently having or not having a Thai tax number should not make any difference whatsoever.  If you are legally staying in Thailand which I assume applies to most on this forum, then the Thai authorities know about you regardless of if you have or do not have a Thai tax number.

[stat]

30 minutes ago, hwas said:

The LTR exemption is not based upon a directive, order, rule, regulation, response to inquiries or other practices, it is a Royal Decree.  You seem to have a fixation with this.  If you do not have an LTR, why do you care? Better to spend your time looking for other workarounds, like gifts.

Thanks for your post! Pls provide source of:

 

a.) LTR visa holders are exempt of taxes even if remitted to Thailand (NOT stated in LTR visa conditions, just stated income that is generated abroad)

b.) Royal degree trumps all laws and directive orders (maybe yes, maybe no, maybe royal degrees change) I have no clue but apparently you do so pls elaborate.

 

I simply care for a solution on how to live tax free in Thailand, no matter on which visa, as most of us do. Why you call it a fixation of mine is beyond me and offensive.

[K2938]

5 hours ago, stat said:

No LTR does not change anyting as it "only" exempts income earned abroad NOT income transfered into TH.

According to the BOI managing the LTR program this is incorrect.  According to them LTR visa holders are exempt from tax on income remitted to Thailand as you can also read in the LTR thread on this forum.

[stat]

1 minute ago, K2938 said:

According to the BOI managing the LTR program this is incorrect.  According to them LTR visa holders are exempt from tax on income remitted to Thailand as you can also read in the LTR thread on this forum.

Not stated in the conditions or royal degree as far as I know.

Edited September 25, 2023 by stat

[hwas]

3 minutes ago, stat said:

Thanks for your post! Pls provide source of:

 

a.) LTR visa holders are exempt of taxes even if remitted to Thailand (NOT stated in LTR visa conditions, just stated income that is generated abroad)

b.) Royal degree trumps all laws and directive orders (maybe yes, maybe no, maybe royal degrees change) I have no clue but apparently you do so pls elaborate.

 

I simply care for a solution on how to live tax free in Thailand, no matter on which visa, as most of us do. Why you call it a fixation of mine is beyond me and offensive.

LTR holders who have posted seem quite confident that they are tax exempt.   If you are truly interested in the LTR and do not have confidence in what has been posted by LTR holders, why don’t you go directly to the BOI and ask them?  I did this last week and received a prompt and satisfactory answer.  

[Dogmatix]

2 hours ago, stat said:

Nope, you are best off transferring a lot of your money into Thailand this year if you intent to stay here and are confident that you can withdraw your money later. The "gifts" should be send in later ????

Get used to receiving 0.5% interest in TH, vs 5.5% in USD offshore.

[hwas]

16 minutes ago, stat said:

Not stated in the conditions or royal degree as far as I know.

 

This could not possibly be more clear:

 

From Royal decree 743:

 

"Section 5 Income tax under Part 2 of Chapter 3 in Title 2 of the Revenue Code shall be exempted for a foreigner categorised as Wealthy Global Citizen, Wealthy Pensioner, or Workfrom-Thailand Professional who is granted a Long-Term Resident Visa under immigration law for assessable income under section 40 of the Revenue Code derived in the previous tax year from an employment, or from business carried on abroad, or from a property situated abroad, and brought into Thailand."

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[Dogmatix]

Saw an old friend today who said he had been harassed by the RD a few years ago.  He was based in TH for years but worked offshore and had no Thai sourced income.  Then after he retired in Bkk he was employed for a couple of years by the Bkk office of an international firm as an advisor which landed him in the Thai tax net for the first time. After his contract expired he stopped filing income tax returns as his only income was a European pension already taxed at source.  So he assumed no assessable income, no more  tax returns.

 

Suddenly one day a delegation from the RD shows up unannounced at his house demanding that he file tax returns again and pay tax on his foreign sourced income. His Thai daughter dealt with them and they ended up agreeing that his pension was not assessable because it was already taxed at source in a DTA country.  The next year they showed up again with the same demands.  My friend is very irascible and was visibly upset with the RD officers since his his assessable tax situation was still the same as the previous year. Eventually his daughter gave the boss man 1,000 baht to go away and not come back.  So far they haven't.

[stat]

"income under section 40 of the Revenue Code derived in the previous tax year..."

 

 

[aldriglikvid]

Capital Gains & Dividends taxed abroad in one of the countries with a DTA - is it somewhat confirmed that it's exempt this coming tax? I understand all details are not out yet. Bless

Edited September 25, 2023 by aldriglikvid

[redwood1]

17 minutes ago, Dogmatix said:

Get used to receiving 0.5% interest in TH, vs 5.5% in USD offshore.

So you will make almost zero intrest on your money and be taxed for the privilege of spending it........... Gee this joke just keeps getting better and better...LoL  YAWN

[stat]

1 minute ago, stat said:

"income under section 40 of the Revenue Code derived in the previous tax year..."

 

 

and again the new directive could impact even a royal degree. That is what I am saying along with EVERY tax advisor. The situation is unclear. Let's hope you are in the right and LTR visa holders are exempt.

[Dogmatix]

16 minutes ago, stat said:

"income under section 40 of the Revenue Code derived in the previous tax year..."

 

 

The wording of the Royal Decree does indeed give exemption from tax for foreign sourced income derived in the previous year.  It was presumably worded like that because the Revenue Code only makes foreign sourced income only from the previous year assessable when remitted to Thailand.  But now the director general has said that clause no longer means what it says and any prior year income remitted to Thailand is taxable.  So foreign sourced income earned by LTR visa holders in years prior to the previous tax year are technically assessable when remitted to Thailand.

[Dogmatix]

28 minutes ago, stat said:

and again the new directive could impact even a royal degree. That is what I am saying along with EVERY tax advisor. The situation is unclear. Let's hope you are in the right and LTR visa holders are exempt.

I don't think it could impact a Royal Decree signed by the PM.  It is an RD order signed by the DG of the RD. So it can only cancel other orders and regulations that are RD orders or equivalent under the DG. You can't have a director general ordering decrees that have the force of law But the wording of the Royal Decree is now defective because it doesn't exempt from tax foreign sourced earnings prior to the previous tax year.  So their situation would be the reverse of the current situation, if enforced literally,

Edited September 25, 2023 by Dogmatix