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

[Puccini]

On 10/6/2023 at 9:56 AM, jerrymahoney said:

From the AMCHAM post above:

 

- Any transfers into the country will need to be declared. To avoid double taxation, you will need to file taxes in Thailand yearly and claim exemption.

If the DTA between the USA and Thailand says so, then so be it.

[jerrymahoney]

4 minutes ago, Puccini said:

If the DTA between the USA and Thailand says so, then so be it.

 

The DTA doesn't say whether you have to file to declare income as under DTA. It also doesn't say that Thailand cannot make you report the income and then apply for the exemption. 

 

Unless somewhere there is a line of the form that says report income that is subject to DTA. As per the DTA Social Security could not be taxed in any manner.

[Mike Lister]

2 minutes ago, jerrymahoney said:

 

The DTA doesn't say whether you have to file to declare income as under DTA. It also doesn't say that Thailand cannot make you report the income and then apply for the exemption. 

 

Unless somewhere there is a line of the form that says report income that is subject to DTA. As per the DTA Social Security could not be taxed in any manner.

US SSc is specifically excluded from any taxation by any country other than the US, it says so in the DTA between the two countries. For Thai tax purposes it is considered to be disregarded income, I have filed Thai tax returns on that basis for two years, using guidance provided by Region 1 Revenue offices in Chiang Mai..

[jerrymahoney]

8 minutes ago, Mike Lister said:

US SSc is specifically excluded from any taxation by any country other than the US, it says so in the DTA between the two countries. For Thai tax purposes it is considered to be disregarded income, I have filed Thai tax returns on that basis for two years, using guidance provided by Region 1 Revenue offices in Chiang Mai..

Well if you are saying you have bee advised by RD officialdom, that for Article 20 DTA items, as they cannot be taxed by Thailand at all, and there is no need to file especially if such items are 100% of your Thai income, 

 

.. that is great info to hear.

[Mike Lister]

Just now, jerrymahoney said:

Well if you are saying you have bee advised by RD officialdom, that for Article 20 DTA items, as they cannot be taxed by Thailand at all, and there is no need to file especially if such items are 100% of your Thai income, 

 

.. that is great info to hear.

US SSc payments are not Thai income, they are overseas income payments received in Thailand. But I also receive income from the UK every month that is paid into the same bank, that income is not excluded income and is shown on my Thai tax return.

[jerrymahoney]

So if e.g. you receive 50,000 baht per month in US Social Security and that is 100% of the  money you transfer to Thailand as a monthly deposit in a Thai bank, there is no need to file a Thai Income tax form. 

[TallGuyJohninBKK]

26 minutes ago, Mike Lister said:

For Thai tax purposes it is considered to be disregarded income, I have filed Thai tax returns on that basis for two years, using guidance provided by Region 1 Revenue offices in Chiang Mai..

Can you clarify what you mean with the above comment? In terms of following advice from the local RD...

 

Are you saying you did the Thai tax filing, included the social security amount, and then claimed it as exempt

 

or

 

Are you saying you did the Thai tax filing, and did NOT include any Social Security amounts in it, because they are exempt?

 

 

Edited October 8, 2023 by TallGuyJohninBKK

[TallGuyJohninBKK]

7 minutes ago, jerrymahoney said:

So if e.g. you receive 50,000 baht per month in US Social Security and that is 100% of the  money you transfer to Thailand as a monthly deposit in a Thai bank, there is no need to file a Thai Income tax form. 

 

That's a very good question.... and the same question would apply for folks whose only incoming funds are sourced from U.S. government pensions, including ex-military, I'd presume.

 

[Mike Lister]

14 minutes ago, TallGuyJohninBKK said:

Can you clarify what you mean with the above comment? In terms of following advice from the local RD...

 

Are you saying you did the Thai tax filing, included the social security amount, and then claimed it as exempt

 

or

 

Are you saying you did the Thai tax filing, and did NOT include any Social Security amounts in it, because they are exempt?

 

 

The latter, the RD didn't even want it shown on the tax return.

[Mike Lister]

23 minutes ago, jerrymahoney said:

So if e.g. you receive 50,000 baht per month in US Social Security and that is 100% of the  money you transfer to Thailand as a monthly deposit in a Thai bank, there is no need to file a Thai Income tax form. 

Logically, yes.

[Mike Lister]

Here's a conundrum:

 

What if a long stay expat, Thai resident for tax purposes, remits income to their bank account in Thailand but the account is a non-resident account? That means the account earns no interest and doesn't need permissions etc to repatriate the funds. As long as said expat has no income from inside Thailand, are those funds subject to Thai tax? I don't see how they can be, given that the account is specifically non-resident.

[TroubleandGrumpy]

17 hours ago, aldriglikvid said:

Again, Thailand does not "record of all foreign deposits into Thailand" and there's absolutely no indication that this will change. Your logic, just because the Thai RD can access certain individual bank transactions as a final resort when under criminal investigation does not equal that Thai monitors all foreign (or domestic) deposits. 

Put differently, all sovereign nations reserve the right of 'final actions' such as expropriate property and assets, surveil phones and sms, withdraw visas, incarcerate people, request bank transactions from banks - and the list goes on. Hopefully we can agree on that these actions rarely occur randomly, not without reason and certainly not against all people. So yes, Thai RD can under a criminal investigation force Bangkok Bank to lift bank secrecy (which is written in law) - but to argue that all transactions are being recorded - which you have many times - is simply not helpful to the forum and extremely a dishonest way to conduct an argument. 

You can go ahead and continue to believe whatever you want.  But I can ssure everyone that all Thai Banks keep a record of all foreign remittances into Thailand, and that especially includes all foreigner's bank accounts which is whgat this is all about - remittances into foreigner's accounts. I can also assure everyone, that if the Thai RD requests (for any valid reason) that the banks provide the details of all foreign depositis into anyone's bank account's (Thai or Foreigners), that the Thai banks can and will comply.  

[Mike Lister]

5 minutes ago, TroubleandGrumpy said:

You can go ahead and continue to believe whatever you want.  But I can ssure everyone that all Thai Banks keep a record of all foreign remittances into Thailand, and that especially includes all foreigner's bank accounts which is whgat this is all about - remittances into foreigner's accounts. I can also assure everyone, that if the Thai RD requests (for any valid reason) that the banks provide the details of all foreign depositis into anyone's bank account's (Thai or Foreigners), that the Thai banks can and will comply.  

I completely agree, that is the function of the banks Treasury Department who provides the consolidated data to BOT. 

Edited October 8, 2023 by Mike Lister

[mokwit]

1 hour ago, Lorry said:

On the contrary,  today the newspaper that cannot be quoted states the obvious: all international bank transactions will have to be monitored closely. 

What should I google to find the article?

[TroubleandGrumpy]

17 hours ago, aldriglikvid said:

It would be a global blockbuster if Thailand would rip up their bank secrecy laws in a rug pull for +15 million foreign accounts, and then putting a random flat tax on all transfers. For all I know, the only one actually believing in this is @TroubleandGrumpy

You are being an abusibe troll - I am not arguing that at all.  I am sayinbg that the Thai banks DO record all foreign remittances into Thailand and that the Thai RD CAN request those details for any tax resident (Thai or Foreigner). 

"Bank secrecy laws" - no such thing when any tac dept is checking up on someone - especially in Thailand.

"Global blockbuster" - mate you have a surreal opinion of your/our importance. 

[JimTripper]

1 hour ago, Mike Lister said:

US SSc is specifically excluded from any taxation by any country other than the US, it says so in the DTA between the two countries. For Thai tax purposes it is considered to be disregarded income, I have filed Thai tax returns on that basis for two years, using guidance provided by Region 1 Revenue offices in Chiang Mai..

is it really taxation if you have to file in thailand, pay tax on it and then deduct it off later or get a refund?

[TroubleandGrumpy]

14 hours ago, Gknrd said:

Is this the longest thread ever on Aseannow????

 

What is ammazing is that it took over 70 pages before the Trolls starting attacking others for their opinions, and the Wokes started attacking for 'incorect statements'. ???? 

 

[Mike Lister]

1 minute ago, JimTripper said:

is it really taxation if you have to file in thailand, pay tax on it and then deduct it off later or get a refund?

It's part of the same process that many countries go through, pay tax, account for it at year end and then pay extra or get a refund.

[TroubleandGrumpy]

10 hours ago, Mike Lister said:

Take a deep breath and read the post again, slowly.

 

"a resident of Thailand and a resident of Thailand for tax purposes are not the same. Someone here on a long stay visa is not a resident of Thailand, only a Thai citizen or a person who has been granted residency can be a Thai resident".

Last time responding to a reality misunderstanding resulting from a failure to read all the posts. This has been discussed and clarified many times - but just for you.

 

1.Taxable Person

Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.

 

Personal Income Tax | The Revenue Department (English Site) (rd.go.th)

[retiree]

11 minutes ago, Mike Lister said:

As long as said expat has no income from inside Thailand, are those funds subject to Thai tax? I don't see how they can be, given that the account is specifically non-resident.

If assessable income earned by a Thai tax resident is remitted to Thailand by a Thai tax resident, it is taxable.   

 

I believe the sole purpose of a non-resident account is to allow you to hold and trade with foreign exchange / currency.  But it's still your Thai bank account (and I believe you get charged a fee in lieu equal to the dollar - baht conversion fee, anyway). 

[TroubleandGrumpy]

15 hours ago, Neeranam said:

They can't and definitely won't do that. 

Good Luck.

[jerrymahoney]

So sometime next year I maybe will take me Social Security statements and my Thai bank statement showing that 100% of my deposits are covered by the SS to the local Thai RD office and ask: 

 

Do I have to file?

[Mike Lister]

11 minutes ago, TroubleandGrumpy said:

Last time responding to a reality misunderstanding resulting from a failure to read all the posts. This has been discussed and clarified many times - but just for you.

 

1.Taxable Person

Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.

 

Personal Income Tax | The Revenue Department (English Site) (rd.go.th)

This is going to be painful, I already know!

 

That's all fine and good from a RD tax perspective but the term "resident" has a broader meaning in the context of citizenship and residency. So when the likes of you and I or any other two non-Thai's use the term "resident", it need qualification. The fact the document above attempts to quantify the terms "resident" and "non-resident" and begins with a definition of Resident (capitalised) and then in the same sentence reverts back to "resident", shows even the RD is not consistent on this point and is slightly confused. A person is (a) Resident for citizenship and Immigration purposes, aka, a Thai national or a naturalised foreigner, or, they are on a visa or an extension of stay, in which case they are not Residents. Similarly, a foreign subject in Thailand can be resident for tax purposes or not-resident for tax purposes. Lastly, a person like you or I who are not Thai are not Residents but we are resident for tax purposes (presumably).

 

Lastly, if you keep your cool and stay polite, we can debate (or not), if you don't, we won't.

[TroubleandGrumpy]

Under the current tax enforcement rules, Thai tax residents (Thais and Foreigners) are only taxed on money  sent to Thailand, that was income in the same year it was remitted into Thailand.  This was a rule exploited by wealthy Thais and Companies to avoid income taxes.

 

It was also under that past 'common practice' that the Thai RD operated, such that as far as they were concerned all Expats retired or married (not those working) were 'accepted' by the Thai RD as not having any income tax payable in Thailand. This change means that is no longer 'technically' the case. Thailand claims to be following common international practice, but in all countries where this is applied, there are clear guidelines and exceptions which apply for a mutlitude of situations. This has not occurred in Thailand and there has not been any explanations, clarifications or exemptions provided for anyoine and any situation.  Ergo (technically) this means that all foreign remittances into Thailand are potentially taxable income. 

 

This new directive (technically) applies to all Expats, unless and until the Thai RD specifically excludes our foreign remittances into Thailand.   If there is no exemption or clarification given for retired/married Expats, then at the worst we will be getting taxed on any non-excluded remittances, and at the best we will be required to lodge a tax return and 'claim' back taxes paid under applicablke DTAs, but without being given details or explanations as to how to do that and how proof can be provided and what is acceptable for each of the 61 DTAs in place (and on a personal note - I am reminded of a movie - Good Luck).

 

While day to day life of retired/married Expats will probably not be affected, it will certainly affect any Expat considering remitting any large amounts of money into Thailand, such as to purchase a new car or even a property. The Thai RD has not clarified how any Expat would be able to prove that income tax is not liable to be paid in Thailand on those large remittances into Thailand.

 

And then it becomes a matter of fairness and rights.  If the long term Expats are required to pay income taxes, what exactly will they get in return.  Will they no longer be treated as second class, will they continue to have to report every 90s days, TM30s, annual renewals, leaving and re-entering. Will they get any of the Govt services provided to their fellow Thai tax residents, such as the 'We Travel Schemes', the Hospital Services and Benefits, will they get the next 10K Baht handout, and will they get any of the other things provided for Thai tax residents by the Thai Government, Provincial Governments and all the local Amphurs.

 

That above sums up my position - take it or leave it - up to you. Personally I will be waiting and watching - and also looking where to 'jump' if it does come to the Thai Govt trying to impose income taxes on my remittances into Thailand.

The right thing to do is to exclude or exempt retired/married long-term Expats, unless that money is specific income (working), but if they do not take that course of action, then that says everythiong we need to know.

If you think they are not aware of all these problems and issues - you are very much m,istaken - it has been stated on most Thai media organisations.  I expect that over the next 3-6 months soemthing will be provided to clarify the application of this new rule - when their 'losing of face' will not be so bad ????

[TroubleandGrumpy]

1 hour ago, Mike Lister said:

US SSc is specifically excluded from any taxation by any country other than the US, it says so in the DTA between the two countries. For Thai tax purposes it is considered to be disregarded income, I have filed Thai tax returns on that basis for two years, using guidance provided by Region 1 Revenue offices in Chiang Mai..

Firstly - the USA has a different arrangement with all other countries than anyone else, and enforces those rules strongly, and everyone complies.  US citizens are liable to pay income tax to USA wherever they reside in the world.

Secondly - has the Thai RD stated that the current situation will not change in any way after Ja1 2024 and the 2025 taxation returns.

Thirdly - I have said many times in past posts that DTAs are different for everyone else than the USA who does not 'allow' its citizens to be taxed overseas, except under specific situations (individually approved).

 

[TroubleandGrumpy]

1 hour ago, Mike Lister said:

The latter, the RD didn't even want it shown on the tax return.

Can you provide that please - show their letter/advice - blank out your personal details of course.

[Mike Lister]

1 minute ago, TroubleandGrumpy said:

Firstly - the USA has a different arrangement with all other countries than anyone else, and enforces those rules strongly, and everyone complies.  US citizens are liable to pay income tax to USA wherever they reside in the world.

Secondly - has the Thai RD stated that the current situation will not change in any way after Ja1 2024 and the 2025 taxation returns.

Thirdly - I have said many times in past posts that DTAs are different for everyone else than the USA who does not 'allow' its citizens to be taxed overseas, except under specific situations (individually approved).

 

Yes, all DTA's are different.

[NanLaew]

1 hour ago, Mike Lister said:

Here's a conundrum:

 

What if a long stay expat, Thai resident for tax purposes, remits income to their bank account in Thailand but the account is a non-resident account? That means the account earns no interest and doesn't need permissions etc to repatriate the funds. As long as said expat has no income from inside Thailand, are those funds subject to Thai tax? I don't see how they can be, given that the account is specifically non-resident.

I was unaware that one could open a bank account in Thailand as a non-resident.

 

Last century, I had a couple of US bank accounts that I was allowed to open as a non-resident visiting employee of an American company. I worked on their foreign operations but attended and eventually ran frequent training courses for their foreign clients in the US. Those two earlier accounts didn't have a tax ID as I didn't have or need a US Social Security Number at that time (paid overseas). Accordingly, they didn't attract any interest either. All legal and above board.

 

Later, as a full-time employee based in the US, I opened a new account that did have the SSN/TIN as I was paying taxes. Some time after 9/11, the Homeland Security Act tightened up on non-resident accounts and US banks were legally compelled to check on all accounts. Without contacting me or asking my permission, my non-resident "tax free" account suddenly had my SSN attached to them. I guess the basic name, date of birth and place of birth identity check was enough for them to make the link.

 

Maybe the Thai RD will do the same here since every nation is on the tax grab these days. A couple of Indian managers I worked with last month were taking a 10-day stopover on the way home from work in Malaysia so that they don't breach India's 180-day tax-resident law.

Edited October 8, 2023 by NanLaew

[bdenner]

Tried searching 77 pages of this thread without an answer:-

Does anyone know how they intend to collect tax our incoming (Wise) transfers (if this BS is to be believed)?

Do they expect my KBank to garnish xx% of the 65K Baht I bring in every month to satisfy my retirement extn. requirements in the form of with holding tax? As they do with the piddily amount of interest I receive!

Edited October 8, 2023 by bdenner
Typo

[Mike Lister]

Just now, TroubleandGrumpy said:

Can you provide that please - show their letter/advice - blank out your personal details of course.

It was verbal communication at the time I first completed the tax return at the Revenue Offices, reinforced verbally in the second year.