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

[spidermike007]

From what I understand this is already being done in the EU. Have a friend who lives in Spain, and he tells me he has to work fairly hard to work around these tax laws, to shelter US income from double taxation. For Thailand to attempt something like this would be foolhardy, ignorant, arrogant, and unwise. They cannot even enforce tax laws at home. How are they going to attempt to police overseas income? Perhaps they could get the weak, and highly complicit banks to cooperate?

[ikke1959]

In fact nothing news. It was already and I wrote several times I had to pay tax in Thailand. Cheaper than in my homecountry. But now my country is going to change the taxagreement with Thailand, so that we have to pay tax in my country and not in Thailand anymore. However Thailand did not approve it yet. maybe shortly and that is more expensive for me 

[Thaindrew]

3 minutes ago, freeworld said:

Visa cards and others taking transaction fees would approve of this message.

you can only minimise your costs not eradicate them completely I suppose but bank transaction fees probably cost you less than a tax bill.

 

There are banks though that have "global debit cards" so you can hold multiple currencies in your home country account and use a debit card to pay in Thailand in Thai Baht with no transaction fees.

[freeworld]

8 minutes ago, Time Traveller said:

This is a really concerning statement because wealth is not the same thing as income. Simply having cash in a foreign account and then transferring it into Thailand is not income and therefore should not be taxable.   If they do try something like  (they did once before with capital controls in 2007) it will be a complete disaster.  

 

In any case, if they adopt a system similar to other countries that tax worldwide income then I don't think it should be of much concern for Americans as the tax treaty means that most of their retirement or investment income won't be taxable in Thailand.  Other countries will need to check their tax treaty.  

 

On a separate note, one thing I never understood about Thailand immigration is that they never considered foreign income tax filings as part of the evidence of income for visa extensions.  Because no one ever is going to declare to the IRS that their income higher than what it truly is.  It's definitely a much more reliable indicator for proof of income than some Embassy witnessed statement.

Basically I think they are referring to a capital gain. If the taxes are paid and can be proven elsewhere then it can be avoided. If the money is not taxed in a foreign jurisdiction then Thailand tax laws would govern the taxation if that wealth was brought into Thailand if the person was tax resident.

Edited September 18, 2023 by freeworld

[billd766]

1 hour ago, impulse said:

If you didn't get mugged last night walking on the sidewalk, you're enjoying for free the benefits of tax money spent on police and sidewalks.

 

In rural Kamphaeng Phet there are only sidewalks in the big villages and I haven't seen a rural policeman outside of the big villages and cities in years.

 

I don't know when the last mugging was out here.

[Mike Teavee]

5 minutes ago, 4MyEgo said:

So those of us who have dividend paying shares which are taxed and those of us who pay withholding tax via our savings in bank accounts don't have to worry, subject to our country having a tax treaty with Thailand.

 

So not a problem for me, and I can't see them taxing pensioners either.

 

Also exempt will be those who have been taxed in a foreign country that has a standing Double Tax Agreement with Thailand.

 

 

Looking at Article 11 of the DTA it seems you could be taxed on income from Dividends... 

 

 

 

 

 

[PingRoundTheWorld]

1 hour ago, impulse said:

If you didn't get mugged last night walking on the sidewalk, you're enjoying for free the benefits of tax money spent on police and sidewalks.

Oh give me a break- we're not getting anything for free. Collectively we're bringing in a LOT of money into the economy - which keeps Thais employed (and paying taxes). We pay sales tax on our purchases which adds up to more than most Thais pay in income tax. We directly or indirectly pay other taxes on real estate etc. If you really wanted to go down and dirty - we pay much more tax than an average Thai does.

Trying to tax foreigners on global income is going to fail miserably - they can't collect what they don't know about, and if they try to they're going to see a wave of expats leave or at least stay out of Thailand for half of the year and spend elsewhere. It's a lose-lose situation for everyone.

[IamNoone88]

It will all change again in a few weeks.

[ChasingTheSun]

7 minutes ago, JackGats said:

Reading this news I'm glad my LTR visa includes a non-tax clause for anything earnt out of Thailand. It couldn't have come at a better time.

What visa is that which includes a non-tax clause?

[NorthernRyland]

38 minutes ago, Sheryl said:

Again, as I explained:  if you are from a country with a double Tax Agreement, and if the money you bring in has already been taxed (at the time earned) in your home country or is currently subject to tax there, it cannot be taxed in Thailand.

 

so who is this targeted at? People who are working in Thailand are already paying taxes and everyone else who brings their foreign earned money here was already taxed in their home country so who does that leave? maybe people living on investing portfolios but I think even those are taxed in many countries.

[hkblademan]

1 hour ago, scorecard said:

Could also be that the individual amount of pension received by some folks is under the Thai personl tax threshhold.

Are you aware of how low that threshold is? 

[RichardColeman]

Imagine if they started taxing you on the income you had already been taxed on in another country 

[ChasingTheSun]

7 minutes ago, spidermike007 said:

From what I understand this is already being done in the EU. Have a friend who lives in Spain, and he tells me he has to work fairly hard to work around these tax laws, to shelter US income from double taxation. For Thailand to attempt something like this would be foolhardy, ignorant, arrogant, and unwise. They cannot even enforce tax laws at home. How are they going to attempt to police overseas income? Perhaps they could get the weak, and highly complicit banks to cooperate?

Fairly easy to just tax all money coming in from overseas.

Would destroy a a huge part of their real estate and retirement sectors, but it can be easily setup.

[chilli42]

Seems the intention is for Thailand to operate the way most other countries do.  I do think the intent is to go after the big fish and not pensioners (though pensioners will be caught in the net). If you are a tax resident of Thailand (I think that means being in Thailand more than 153 days in a calendar year).  You will need to file Thai income tax with the intent being to declare your global income.  Thailand has dual tax treaties in place with almost every country so any tax you paid in the home country will be deducted from tax owing in Thailand.  How do Thai authorities find out what you earn?  As many have already pointed out that will be seen by the money you transfer in.  When your tax return is audited you will have some explaining to do if your money transferred in is much more than your claimed income.  There is also the fact that there is a global agreement among tax authorities and banks where your income in the foreign country is reported to Thai tax authorities annually.  Thailand is already a signatory to this agreement. So if this change to the tax code goes ahead (and its certain it will since it the way most countries do things) and they do end up taxing pension income, you are going to have to think long and hard about your story/explanation as there won't be much wiggle room should you be caught in an audit. If this all comes to pass they only way out is to not be in Thailand long enough in the year to qualify as a tax resident.  Though you will have to claim a country as a tax residence perhaps it can be a country where low tax rates are the norm.

[Jelli]

Well, when I take my pension in two years I guess I won't be sending it directly to Thailand via Bangkok Bank that's for sure.

 

Funny, what right do they believe they have to such income? We're not even permanent residents.

Edited September 18, 2023 by Jelli

[happydreamer]

1 hour ago, lordgrinz said:

In the USA we are tax residents of the USA no matter where we live, thankfully there is a tax treaty between the USA and Thailand.

So is this basically if you pay income tax in US you dont pay it here? Or vice versa?

If you're a tax resident do you pay tax on your global income or the amount of money you have brought into Thailand throughout the year?

Edited September 18, 2023 by happydreamer

[hkblademan]

3 minutes ago, ChasingTheSun said:

What visa is that which includes a non-tax clause?

If tax law changes you’ll be paying new tax rates same as everyone else.

[damo1967]

1 hour ago, bdenner said:

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

Brilliantly said!  Old fuddy duddy's LOL!   

Are some of these people (who just absolutely reek of 'success' in their lifetimes) now worrying about the regular 'handouts' from their government because they have not been mature enough to manage their lives financially in the past?  They can't have their cake and eat it to lol.

 

[NorthernRyland]

36 minutes ago, moe666 said:

We pay the same tax all Thais pay, every time I go to the store to buy something my purchase is taxed. We just do not pay a personal income tax.

Does anyone know what % of the population pays taxes here? I know government employees do but I've even heard them say taxes are negligible. So much of the population is earning cash running tiny shops that I can't imagine they're paying any sizable income tax.

[Moonlover]

1 hour ago, bdenner said:

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

I completely agree with you. As far as most of us are concerned, the most important sentence in the article is:

 

'Also exempt will be those who have been taxed in a foreign country that has a standing Double Tax Agreement with Thailand'.

 

And that I'm sure will mean all of us on this forum. Those who would like to see which countries have a DTA with Thailand can ask ChatGPT. The list certainly includes my country, the UK.

[JackGats]

3 minutes ago, ChasingTheSun said:

What visa is that which includes a non-tax clause?

LTR ("long-term-resident"). There's an active thread on Aseanow about that visa.

[Ben Zioner]

4 minutes ago, ChasingTheSun said:

What visa is that which includes a non-tax clause?

BOI/LTR WP

 

 

[SiSePuede419]

Taxes are a sign you are successful.

If you're poor, you don't pay much income tax.

Let's say the tax will 10%.  If I "import" $2500 USD every month then that's $250/month tax or $3000/year.

Since America makes their tax code so convoluted and <deleted> up, the IRS assumes you made mistakes if you don't have an accountant prepare your taxes, so I'm forced to pay $500 for a CPA to do my Federal and state forms.

 

They will just deduct that $3000 off my American taxes and it will just be lumped on my (overpayment) tax refund at the end of the year.

IOW, I will get 100% of the Thai income taxes back if they file an additional form.  Shouldn't cost any more.

Don't see why that's going to cause swarms of Farangs to leave.

Except for the ones laundering money GOOD RIDDANCE

 

[Srikcir]

1 hour ago, lordgrinz said:

In the USA we are tax residents of the USA no matter where we live, thankfully there is a tax treaty between the USA and Thailand.

Even without a tax treaty there can still be taxation parity. The US Foreign Tax Credit can be used to offset Foreign taxes paid abroad dollar-for-dollar to the point of having no US federal tax obligation.

But to avoid any interim double taxation (requiring offset by US tax credits in 2024 tax filing), changes to withholding for US taxes from income effective for 2024 MUST be filed at least in November 2023 with the US so that no taxes are withheld beginning January 2024. 

So it it critical for some expats like from the US to know Thailand's new tax rules before December 2023, if not earlier if a US Federal pension is involved.

I'm not optimistic that this new government can act that quickly nor would care. 

[NoshowJones]

2 hours ago, seajae said:

so does this mean all incoming money transfers from abroad, if so will they will be taxing pensions as well when they are transferred from other countries, sounds more like a huge money grab by the government if it does, they should only be able to tax money earnt from Thailand not savings etc that were/are earned in other countries. This will be challenged as it is outright theft if the money has nothing to do with Thailand earnings, only the country where it is earned or banked have the right to any taxes from it, the finer details are needed to make sure what they plan to do is legal and not jut a way to rip farangs off 

If the UK government can rip off state pensioners by not giving them their annual increases and get away with it, then any government in any country can also rip them off in any way they want.

[domdom]

Hello

It is clearly written people concerned are people paying tax in Thailand.. Example, Thai having a business in Thailand and having either a business or properties abroad, which he till date never informed Thai tax department about..

Or foreigner working here and therefore paying tax here, and having other sources of revenues abroad.

People whose only source of revenue is abroad don't have to worry..

Have a good day

[NoDisplayName]

47 minutes ago, Modern Coding said:

Welcome to global socialism: taxes, taxes and again taxes.

 

France has been taxing foreign incomes for ages already, US has been practicing double taxation for ages as well, Myanmar is now requiring all abroad-based Burmese citizens to pay 25% of their income back to the country, now Thailand is taxing foreign income as well,... And this is all just about to start.

 

Next step is global communism: "you will have nothing and you will be happy".

We're in the right place.

The supermarkets carry bags of frozen bugs.

I'll eat 'em, and be happy!

[Cardinalblue1958]

1 hour ago, impulse said:

If you didn't get mugged last night walking on the sidewalk, you're enjoying for free the benefits of tax money spent on police and sidewalks.

 

Are you talking about their stellar traffic enforcement police unit or sidewalks/bike paths for motorcycle riding?

[mokwit]

Just now, domdom said:

People whose only source of revenue is abroad don't have to worry..

Don't think so. It can be eligible for tax under the existing tax laws. If you live here more than 180 days and are transferring money from overseas income in the tax year it is earned you are eligible for tax.

[NorthernRyland]

22 minutes ago, Time Traveller said:

On a separate note, one thing I never understood about Thailand immigration is that they never considered foreign income tax filings as part of the evidence of income for visa extensions.  Because no one ever is going to declare to the IRS that their income higher than what it truly is.  It's definitely a much more reliable indicator for proof of income than some Embassy witnessed statement

Thailand immigration is mainly a make-work program for government bureaucrats. Very little of it actually makes sense if their goal was merely to manage immigration in a safe, fair and efficient way.