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

[Dogmatix]

10 minutes ago, Lorry said:

They haven't.

 

Another poster was asking why the developers don't react. I guess they know this. 

It's hard to imagine that Thailand's "infinite appeal" will endure in the mind of an LTR retiree faced with RD inspectors showing up at his 20 mil condo in Phuket demanding 10 mil in tax, interest and penalties, 5 years after he bought the condo.  It also makes sense that people who already tax residents or will be in their first year would abandon plans to buy condos with taxable past savings.

 

[redwood1]

However long this tax mess is unresolved is however long there will be almost ZERO Condo sales in Thailand.....Do doubt about this....

 

Here is the current condo market..

 

 

 

Edited October 2, 2023 by redwood1

[TroubleandGrumpy]

I have found some documentation which would be used by an Expat if the Thai RD decided that the DTA with their home country does not apply and they have to pay tax.  These two RD website links provide some details about what is required if they wish to appeal/dispute that decision made by the Thai RD.

MutualAgreementProcedureProfile.pdf (rd.go.th)

final_MAPmanualEN.pdf (rd.go.th)

 

As clear as mud, and as uncomplicated as a space rocket - and the 'appeal' must be made it Thai. Clearly, anyone in that situation will have to spend a lot of time and money, including employing a Thai 'specialist', in order to have any chance of success.  And judging by the past 'success rate' of Expats taking Thais to a Court, I would say the chances of winning are none and buckleys.

[TroubleandGrumpy]

1 hour ago, redwood1 said:

However long this tax mess is unresolved is however long there will be almost ZERO Condo sales in Thailand.....Do doubt about this....

Here is the current condo market..

 

 

EDIT - Here is the current condo property market......... for all Foreigners and Expats living in Thailand more than 180 days per year.  I would say that any of us even thinking about buying a condo or a house, meaning bringing in the large amount of money to pay fopr that, are now in a 'holding pattern'.

Edited October 2, 2023 by TroubleandGrumpy

[stat]

11 hours ago, ukrules said:

Correct - there's a lot of hysteria and absolute nonsense about CRS being circulated by people who obviously know absolutely nothing about it i and I'm seeing a lot of it in this thread.

 

Correct but it does not help that transactions are not being circulated. CRS report will show your CUMMULATED revenue i.e. you trade 1000times 10.000 USD and it will show 10 Million USD revenue. So you can imagine that this will not be to your benefit whilst discussing this "huge wealth" with any tax inspector who does not understand the difference between revenue and profit.

[stat]

8 hours ago, Middle Aged Grouch said:

Why all the bother ? Just start looking to move to Vietnam or Cambodia or Malaysia, the Philippines, or even India...

Yeah great idea to move to the The Socialist Republic of VietNam. If you spend 5 secs online search you would know that you are taxed there much worse then in Thailand. Spoiler alert, if you do not want to spend the 5 secs just read out aloud the part of the name that starts with an s.

Edited October 2, 2023 by stat

[stat]

5 hours ago, Ricardo said:

Actually, I may have to take that back, as I just saw a recent list of countries which say they're reporting under CRS, but I would still take that with a very large pinch-of-salt ! 

 

Offshore banking-centres would IMO only give the most sketchy/basic information, that they can get away with.  It's simply not in their interest to do more.  And how much time/expertise/desire the RD would have, to deal with such a mass of information, well I still have my doubts.

 

Colour me cynical.  ????

 

 

I colour you clueless sorry no offense. The name gives it already away "Common Reporting Standard" it is exactly this. No country (besides the US) can just make the report up as they wish. I agree that the RD currently can make next to nothing out of these reports but in 5-10 years they can and maybe come back with a bill for the last years including fines and interest.

Edited October 2, 2023 by stat

[stat]

4 hours ago, TroubleandGrumpy said:

With individual experts who are specialists in the DTA for each home country. They are all very different.

Nope most of them use the same standard template.

[TroubleandGrumpy]

2 minutes ago, stat said:

Correct but it does not help that transactions are not being circulated. CRS report will show your CUMMULATED revenue i.e. you trade 1000times 10.000 USD and it will show 10 Million USD revenue. So you can imagine that this will not be to your benefit whilst discussing this "huge wealth" with any tax inspector who does not understand the difference between revenue and profit.

Nail on the head hit !!  That is the problem - how Somchai the Thai RD Inspector will deal with this.

 

After much discussion and some debate I have formd my opinion and my course of action.

1.  I will be a Thailand tax resident on 28th June 2024.

2.  My 'income' from withion my Supoer Fund in Aust is already taxed at 15% - and therefore under the DTA between Aust/Thailand  I have no obligation to pay any tax to Thailand RD for that annual return.

3.  My 'income' in the form of my Aust Govt Pension is not taxable in Thailand - and therefore under the DTA between Aust/Thailand  I have no obligation to pay any tax to Thailand RD for that Pension.

4. All transfers into Thailand come from my savings (in Super) and my Pension payments - and therefore under the DTA between Aust/Thailand  I have no obligation to pay any tax to Thailand.

5.  I therefore have no obligation to complete an annual tax return in Thailand.

6.  That may well be the 'truth' - but that will not necessarily be easily accepted by Somchai the Thai RD Inspector who wants me to pay taxes on my 1 Million Baht in bank transfers into Thailand in 2024.

7.  Therefore I will be keeping as low a profile as possible to avoid meeting Somchai. My transfers into Thailand will all be in amounts well under the 'standard reporting' level of $10K USD.

8.  I will be calculating my Thailand tax details every year and keeping all associated documents in a file, just in case Somchai does in the future 'come knocking'.

9.  If Thailand ever makes incoming transfers into Thailand taxable, then we will be leaving the country. In order to facilitate that decision, we will not be purchasing any property in Thailand for the foreseeable future (renting only).

 

I have my course of action, and now it is a matter of wait and see how things pan out.  I hope all those saying it will be fine are right - but thanks to all those who decided to research and provided their thoughts and information, just in case they are wrong.

[TroubleandGrumpy]

14 minutes ago, stat said:

Yeah great idea to move to the The Socialist Republic of VietNam. If you spend 5 secs online search you would know that you are taxed there much worse then in Thailand. Spoiler read, if you do not want to spend the 5 secs just read out aloud the part of the name that starts with an s.

IMO there are only three viable countries for most Expats - Malaysia, Philippines, Indonesia. Those with more 'wealth' would also have Singapore on their list (probably first).

[TroubleandGrumpy]

8 minutes ago, stat said:

Nope most of them use the same standard template.

Yes true. But if you look at Australia's and UK's and USA's as examples they are all very different in the details.

 

[stat]

1 minute ago, TroubleandGrumpy said:

IMO there are only three viable countries for most Expats - Malaysia, Philippines, Indonesia. Those with more 'wealth' would also have Singapore on their list (probably first).

Malaysia and Philippines yes, Indonesia no (taxes on worldwide cap gains even if not remitted)

[TroubleandGrumpy]

1 minute ago, stat said:

Malaysia and Philippines yes, Indonesia no (taxes on worldwide cap gains even if not remitted)

Thanks - good to know. 

[Sigmund]

11 minutes ago, TroubleandGrumpy said:

Nail on the head hit !!  That is the problem - how Somchai the Thai RD Inspector will deal with this.

 

After much discussion and some debate I have formd my opinion and my course of action.

1.  I will be a Thailand tax resident on 28th June 2024.

2.  My 'income' from withion my Supoer Fund in Aust is already taxed at 15% - and therefore under the DTA between Aust/Thailand  I have no obligation to pay any tax to Thailand RD for that annual return.

3.  My 'income' in the form of my Aust Govt Pension is not taxable in Thailand - and therefore under the DTA between Aust/Thailand  I have no obligation to pay any tax to Thailand RD for that Pension.

4. All transfers into Thailand come from my savings (in Super) and my Pension payments - and therefore under the DTA between Aust/Thailand  I have no obligation to pay any tax to Thailand.

5.  I therefore have no obligation to complete an annual tax return in Thailand.

6.  That may well be the 'truth' - but that will not necessarily be easily accepted by Somchai the Thai RD Inspector who wants me to pay taxes on my 1 Million Baht in bank transfers into Thailand in 2024.

7.  Therefore I will be keeping as low a profile as possible to avoid meeting Somchai. My transfers into Thailand will all be in amounts well under the 'standard reporting' level of $10K USD.

8.  I will be calculating my Thailand tax details every year and keeping all associated documents in a file, just in case Somchai does in the future 'come knocking'.

9.  If Thailand ever makes incoming transfers into Thailand taxable, then we will be leaving the country. In order to facilitate that decision, we will not be purchasing any property in Thailand for the foreseeable future (renting only).

 

I have my course of action, and now it is a matter of wait and see how things pan out.  I hope all those saying it will be fine are right - but thanks to all those who decided to research and provided their thoughts and information, just in case they are wrong.

You seem to have time to loose and waste - good for you.

 

A majority of other retirees expats do not want to be bothered with all the extra paperwork and business given to the new opportunities for crooked Thai accountants to file tax claims, tax information and get acces to the retiree's bank account.

 

Many retirees are tax exempt in their home country on pensions that are paid abroad. Now they will have to pay in Thailand. Retirees come from places other then the US, Australia or NZ or UK you know.

 

Pack up, try to sell, leave to another Asian Country and get a new wife in the Phillippines or Malaysia, Indonesia.... who treat foreigners better. Your cost of living will be divided by 2 Thailand does not want middle class foreigners any more apparently.

Edited October 2, 2023 by Sigmund

[jerrymahoney]

(US) TAXATION CONVENTION WITH THAILAND

ARTICLE 24
Other Income

 

2. The provisions of paragraph 1 shall not apply to income, other than income from immovable property as defined in paragraph 2 of Article 6 (Income from Immovable (Real) Property), if the beneficial owner of the income, being a resident of a Contracting State, carries on business in the other Contracting State through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect of which the income is paid is effectively connected with such permanent establishment or fixed base. In such case the provisions of Article 7 (Business Profits) or Article 15 (Independent Personal Services), as the case may be, shall apply.

****************

 

Now I could see where -- if there is to be disagreement between an expat resident and the ThaiRevDept -- given the documentation likely required to take advantage of this article/paragraph.

 

But these kind of complex arcane questions are likely not to involve the run of the mill persons on pensions or social security who are unlikely at best to end up in a tax court in Thailand over DTA disagreements.

Edited October 2, 2023 by jerrymahoney

[bdenner]

I posted early in this thread and not read it all - forgive me:-

Many years ogo I loaned my Thai brother in law 100 K Baht to get employment in Taiwan in tyre manufacturing business.

4 years down the track he sent everything he could back to his wife, paying me back and setting up a nice nest egg for his wife & kids.

Does this government intend to levy a TAX on the wives of these responsible, hard working Thai's earning a future for their families?

Edited October 2, 2023 by bdenner
Typo

[JimGant]

6 hours ago, Arkady said:

Interesting but no mention of the potential impact on the condo market,

Actually, the article you mention addresses the impact on FDI, which includes condos, and buyers who have lived here a long time, but who bring purchase money in from abroad. BoI, a major player in Thai economic guidance, is the personal protector of FDI, a major player in economic growth -- so I doubt they'll allow things to go forward as now presented.

 

If they just got rid of the "remittance" aspect of all of this, and just concentrated on income earned abroad, regardless of remittance, then things could be workable. CRS and FATCA reporting aren't going to show remittance; heck, all my taxable income is direct deposited into my US savings account, from which Wise sucks it out for transfer to Bangkok Bank, mixed with five years of previous income and non income (inheritance), to become a mass of fungible dollars -- how is FATCA (or CRS) going to trace that as identifiable income? They can't (at least for now -- AI may be down the road. Barf).

 

Anyway, there are too many loose elements with this new proposal for it to go forward  -- not the least of which is torpedoing FDI, to include condos.

 

[Middle Aged Grouch]

What about the sukhumvit Bangkok tailors and their foreign tours to sell suits in small hotel rooms in Europe ? Will they be taxed on the foreign income ?

[MartinBangkok]

On 10/1/2023 at 2:54 PM, quake said:

One thing for sure.

New cars. bikes, condos, houses, and so on will take a nose dive in the expat community until we know all the facts about this.

TIT.

 

 

I have abandoned my plan to buy the new BMW 5 series (approximately 3,6 million Baht, including about 1,6 million directly injected to Thailand's state coffers in form of total import fees). Plus VAT.

 

Instead I am contemplating selling my new Ford Raptor (V6 400hp) and my 1 year old 1100 cc Honda big bike (only to a Farang who can pay me outside of Thai banking system).

 

Next step: Finding another more appreciating/ welcoming country to live in.

 

Who looses? Thailand or me?

 

Cheers

 

Edited October 2, 2023 by MartinBangkok
Addition

[transam]

1 minute ago, MartinBangkok said:

I have abandoned my plan to buy the new BMW 5 series (approximately 3,6 million Baht, including about 1,6 million directly injected to Thailand's state coffers in form of total import fees).

 

Instead I am contemplating selling my new Ford Raptor (V6 400hp) and my 1 year old 1100 cc Honda big bike (only to a Farang who can pay me outside of Thai banking system).

 

Next step: Finding another more appreciating/ welcoming country to live in.

 

Who looses? Thailand or me?

 

Cheers

 

I think perhaps you will "looses"......... 

 

If you planned to live in LOS, and now are stamping your feet over something that at the mo is in the wind, perhaps you are better off following your money protection thing, but where the ........dot's.......... seem to be lining up wherever you go, in our modern high-tech world..........????

 

 

[moogradod]

Many of the posts here pertain to specific situations of either US, UK or Australian citizens. Because this is an English speaking forum and because these states have somewhat peculiar rules (example: every US citizen must pay tax in the US regardless of his home-adress etc.). And therefore the specific DTA come as well into play.

 

But there are other states and retirees from other countries. Example (fictous): A citizen of Sweden has lived his whole life in South Korea and is now retired. He is entitled to a state pension (not government pension) from Korea directly payable to a bank account in Thailand. The money is transferred directly every month from a Financial Department of Korea into the account.

 

The Swedish citizen has a passport still valid some years and has never lived in Sweden. He will have his next and first contact with his embassy in Thailand when he applies for a next passport. So, if there were DTA between Sweden, Korea and Thailand in place they would not have any significance for him since he is neither tax resident in Sweden althought he has a Swedish passport nor Korea because he does not live there anymore. But he has been more than 180 days in Thailand and did and does receive the Korean Pension remitted directly.

 

What would be the best approach to get the maximum out of it or to prevent even possible harm ? I am not sure if the CRS would more confuse than clarify. The Thai RD would maybe inform Korea where he is neither registered nor tax resident. Or Sweden where he is neither registered nor tax resident either. Korea would probably inform Thailand. Both know of course the name and the bank- and acccount number as well as the living adress (not the RD, but the immigration) . The Swedish guy has no tax number by the way.

[lordgrinz]

36 minutes ago, MartinBangkok said:

I have abandoned my plan to buy the new BMW 5 series (approximately 3,6 million Baht, including about 1,6 million directly injected to Thailand's state coffers in form of total import fees). Plus VAT.

 

Instead I am contemplating selling my new Ford Raptor (V6 400hp) and my 1 year old 1100 cc Honda big bike (only to a Farang who can pay me outside of Thai banking system).

 

Next step: Finding another more appreciating/ welcoming country to live in.

 

Who looses? Thailand or me?

 

Cheers

 

Good luck getting your money back, you will ultimately lose on those resells.

[MartinBangkok]

35 minutes ago, transam said:

I think perhaps you will "looses"......... 

 

If you planned to live in LOS, and now are stamping your feet over something that at the mo is in the wind, perhaps you are better off following your money protection thing, but where the ........dot's.......... seem to be lining up wherever you go, in our modern high-tech world..........????

 

 

There are/will be countries that appreciate the economic benefits of attracting people who contribute to the economy.

[transam]

1 minute ago, MartinBangkok said:

There are/will be countries that appreciate the economic benefits of attracting people who contribute to the economy.

 

You missed my point, you planned to spending your days in LOS, buying expensive rides, etc, but ditching it all because you are worried about a "possible" tax demand, seems a bit daft. ????

 

But, no doubt Africa awaits you with open arms................. 

[Antti]

The Elite Visa program was rebranded as Thai Privilege Visa and relaunched 1st of October. On the website in the FAQ section it says:

 

Do I have to pay income taxes in Thailand as a Thai Privilege visa holder?

The Thai Privilege Visa is a privilege visa which falls under the special tourist visa or privilege entry category. The Thai Privilege Visa holder does not need to pay income taxes especially when the income was derived abroad. There are instances where a Thai Privilege Visa holder may voluntarily pay income tax in Thailand.

 

This is promising but of course an official statement from the tax department is needed. I'd assume the same rules would apply to people who have Elite Visa.

[freeworld]

43 minutes ago, moogradod said:

Many of the posts here pertain to specific situations of either US, UK or Australian citizens. Because this is an English speaking forum and because these states have somewhat peculiar rules (example: every US citizen must pay tax in the US regardless of his home-adress etc.). And therefore the specific DTA come as well into play.

 

But there are other states and retirees from other countries. Example (fictous): A citizen of Sweden has lived his whole life in South Korea and is now retired. He is entitled to a state pension (not government pension) from Korea directly payable to a bank account in Thailand. The money is transferred directly every month from a Financial Department of Korea into the account.

 

The Swedish citizen has a passport still valid some years and has never lived in Sweden. He will have his next and first contact with his embassy in Thailand when he applies for a next passport. So, if there were DTA between Sweden, Korea and Thailand in place they would not have any significance for him since he is neither tax resident in Sweden althought he has a Swedish passport nor Korea because he does not live there anymore. But he has been more than 180 days in Thailand and did and does receive the Korean Pension remitted directly.

 

What would be the best approach to get the maximum out of it or to prevent even possible harm ? I am not sure if the CRS would more confuse than clarify. The Thai RD would maybe inform Korea where he is neither registered nor tax resident. Or Sweden where he is neither registered nor tax resident either. Korea would probably inform Thailand. Both know of course the name and the bank- and acccount number as well as the living adress (not the RD, but the immigration) . The Swedish guy has no tax number by the way.

For CRS there is nothing to do.

 

Pension.

 

Is this a govt or private pension? because there is an article in the DTA between Korea and Thailand covering pensions.

 

Is Korea deducting tax off the pension?

Edited October 2, 2023 by freeworld

[freeworld]

2 hours ago, bdenner said:

I posted early in this thread and not read it all - forgive me:-

Many years ogo I loaned my Thai brother in law 100 K Baht to get employment in Taiwan in tyre manufacturing business.

4 years down the track he sent everything he could back to his wife, paying me back and setting up a nice nest egg for his wife & kids.

Does this government intend to levy a TAX on the wives of these responsible, hard working Thai's earning a future for their families?

Theoretically if hes working in Taiwan he should be paying tax there so the money he is remitting to Thailand is savings and would not be subject to reporting and tax.

[leemeshi]

17 minutes ago, Antti said:

The Elite Visa program was rebranded as Thai Privilege Visa and relaunched 1st of October. On the website in the FAQ section it says:

 

Do I have to pay income taxes in Thailand as a Thai Privilege visa holder?

The Thai Privilege Visa is a privilege visa which falls under the special tourist visa or privilege entry category. The Thai Privilege Visa holder does not need to pay income taxes especially when the income was derived abroad. There are instances where a Thai Privilege Visa holder may voluntarily pay income tax in Thailand.

 

This is promising but of course an official statement from the tax department is needed. I'd assume the same rules would apply to people who have Elite Visa.

In the FAQ of the official website there is no mention of this. Your above quote was posted on 3rd party Elite visa websites which look official but are just sale agencies. It's validity was discussed here but not confirmed.

[Antti]

Just now, leemeshi said:

In the FAQ of the official website there is no mention of this. Your above quote was posted on 3rd party Elite visa websites which look official but are just sale agencies. It's validity was discussed here but not confirmed.

Ah ok, thanks for pointing that out. Hopefully it will be clarified soon. Can't imagine there are many buyers for the Privilege visa before that happens.

[Lorry]

2 hours ago, bdenner said:

I posted early in this thread and not read it all - forgive me:-

Many years ogo I loaned my Thai brother in law 100 K Baht to get employment in Taiwan in tyre manufacturing business.

4 years down the track he sent everything he could back to his wife, paying me back and setting up a nice nest egg for his wife & kids.

Does this government intend to levy a TAX on the wives of these responsible, hard working Thai's earning a future for their families?

Yes.

This is why Thais working abroad are upset, see my screenshot from tiktok above. 

Israel doesn't even have a DTA, Taiwan probably doesn't have one.

Korea may have one, but a DTA doesn't help illegal workers. 

Finland probably has one.

 

But in this thread you can see that educated farang find the recourse to a DTA a "bureaucratic nightmare".

An industrial worker will certainly not get any help from a DTA.

Edited October 2, 2023 by Lorry