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

[The Cyclist]

3 hours ago, Mike Lister said:

But your quote from the latest Q&A is not correct. What that quote actually says is, "When residents of Thailand pay tax on income abroad, it can be credited against the tax payable  in Thailand according to the Double Tax Agreement that Thailand has entered into with foreign countries". That is very different, potentially, from saying what you misquoted!

 

https://sherrings.com/foreign-source-income-personal-tax-thailand.html

 

That might be because it has been updated since it was originally posted.

 

Quote

Question 15: If my foreign source income is assessable income on which I have paid tax abroad and I bring the income into Thailand, is tax payable in Thailand again? Won't there be double taxation? Can the tax paid abroad be credited for eliminating double taxation or not?
Answer: There's no double taxation for residents of Thailand. When residents of Thailand pay tax on income abroad, it can be credited against the tax payable in Thailand according to the Double Tax Agreements that Thailand has entered into with foreign countries.

 

And only applies to assessable income.

[Mike Lister]

13 minutes ago, The Cyclist said:

 

That might be because it has been updated since it was originally posted.

 

 

And only applies to assessable income.

No it hasn't been updated, my initial post on 2 February said:

 

"Q; a lengthy question about tax paid on income overseas.

A; There is no double taxation in Thailand, tax paid overseas can be credited against tax payable."

[Mike Lister]

10 minutes ago, The Cyclist said:

 

Where does your post of 02 Feb, posred above by you, requoted by me,  mention assessable income ?
 

Which is now mentioned in the Q&A in question 15.

 

You also posted this on 02 Feb

 

 

 

These 2 points cover the biggest majority of Brits that read and post on these threads.

 

 

Your original quote was wrong, that was why it was edited out, you know it so stop arguing!

 

[stat]

12 hours ago, Mike Lister said:

 

"So do you think it is reasonable that we can truly pick what we remit, I am indeed hoping that is the case".

 

This is absolutely the case, it is the basis of all self assessment in that you the assessor/taxpayer, determine what funds you remit and from where. You are innocent until proven guilty! It is the RD job to determine if the facts and supporting evidence you (may be required to) submit later are adequate or not. If they think they are not, they will have to disprove them.

 

Every tax system I know stipulates the order regarding minglement of funds (not the Thai RD so far). Is it FIFO LIFO or something else no one knows and my guess is no one will know in the near future Mid 2025 or later.

 

Mike Lister wrote:

"You are innocent until proven guilty!"

 

What is it you want to tell us with this sentence? When you are proven guilty you are kneedeep in problems. In every tax system you self declare but if you selfdeclared wrong you are guilty.

[Mike Lister]

10 minutes ago, stat said:

Every tax system I know stipulates the order regarding minglement of funds (not the Thai RD so far). Is it FIFO LIFO or something else no one knows and my guess is no one will know in the near future Mid 2025 or later.

 

Mike Lister wrote:

"You are innocent until proven guilty!"

 

What is it you want to tell us with this sentence? When you are proven guilty you are kneedeep in problems. In every tax system you self declare but if you selfdeclared wrong you are guilty.

Agreed in bold

[4MyEgo]

 

I'd really like to know how this is going to effect expats that use agents because they don't have the funds to remit to Thailand, if the RD wants them to have a tax file number.

 

I hazzard a guess that immigration officers around the country would come up with some genius idea, like only target those with funds in their accounts when applying for extensions, e.g. hey Mr Money Bags, you need a TFN to declare where the money you remitted came from, so the RD can look at possibly taxing you.

 

As for those who use agents, they would get a free pass for the usual brown envelope via the agents.

 

Hmmm, if this does occur, I thinks me will see an agent. 

 

 

 

 

Edited February 9 by 4MyEgo

[Mike Lister]

1 hour ago, 4MyEgo said:

 

I'd really like to know how this is going to effect expats that use agents because they don't have the funds to remit to Thailand, if the RD wants them to have a tax file number.

 

I hazzard a guess that immigration officers around the country would come up with some genius idea, like only target those with funds in their accounts when applying for extensions, e.g. hey Mr Money Bags, you need a TFN to declare where the money you remitted came from, so the RD can look at possibly taxing you.

 

As for those who use agents, they would get a free pass for the usual brown envelope via the agents.

 

Hmmm, if this does occur, I thinks me will see an agent. 

 

 

 

 

I don't know that the RD does want all expats to have a tax number, remember, the tax rule change wasn't aimed primarily at expats, it was aimed at Thai citizens, that was the stated objective. 

 

Similarly, there is no reason to believe at this point that there will ever be a link between the RD/Tax ID numbers, and, Immigration/visa extensions. It is of course possible that link could be established but just being possible, doesn't mean it's likely.

 

The huge range of spoken and written languages, combined with the large diverse range of financial products, makes it highly unlikely that all RD offices around the country are going to want to, or be able to, interact with foreigners. Even the banks don't want to do that and all their products and material is in Thai., there's no reason to think the RD is going to be any different.

 

 

 

[roobaa01]

Gday

 

Having watched today several tube videos about the new Thai tax lax none advised about tax rebates in Thailand the same applies to the thread over here. Hence who can advise on Thai tax rebate here with

Figures? 

 

Wbr

Roobaa01

[JimGant]

On 2/9/2024 at 4:53 PM, The Cyclist said:

Answer: There's no double taxation for residents of Thailand. When residents of Thailand pay tax on income abroad, it can be credited against the tax payable in Thailand according to the Double Tax Agreements that Thailand has entered into with foreign countries.

Uh, this doesn't track with most DTAs. Take the US-Thai DTA. Private pensions are exclusively taxable by Thailand, the country of residence. That the US also taxes these pensions, as secondary taxation authority, means that, in the interest of avoiding double taxation, the US has to absorb a Thai taxation credit. As such, the US may realize no taxes, should the Thai credits exceed the US tax bill. And Thailand, as exclusive taxation authority, gets to keep the whole tax collection, without any offset from US tax credits.

 

Thus, to say that all Thai taxation will be offset by taxes paid to the home country on this income -- in all situations -- is pure baloney. Thailand, if they have any gumption, will apply the DTA to their benefit, and apply full taxation to those monies indicated by the DTA -- and provide a tax credit for this full taxation to the home country.

 

How this will work out in practice, I don't know. Amended tax returns, maybe, to slip that Thai tax credit into home country taxation? I just know Thailand probably will not give up taxes by absorbing tax credits that the DTA says should go the other way. 

 

Whatever. For most of us, this just means our total tax bill will be the same, only, if Thailand is smart, they'll monitor what's due them via the DTAs. And tax appropriately.

[The Cyclist]

Quote

Answer: There's no double taxation for residents of Thailand. When residents of Thailand pay tax on income abroad, it can be credited against the tax payable in Thailand according to the Double Tax Agreements that Thailand has entered into with foreign countries.

 

 

9 minutes ago, JimGant said:

Thus, to say that all Thai taxation will be offset by taxes paid to the home country on this income -- in all situations -- is pure baloney.

 

Best take it up with Sherrings then, after all, it is their Q & A session.

 

Until all the baloney is sorted out, the only income I will be remitting into  Thailand in 2024 is my Government pension.

 

Job Jobbed as far as the Thai Taxman is concerned.

[Mike Lister]

15 minutes ago, JimGant said:

Uh, this doesn't track with most DTAs. Take the US-Thai DTA. Private pensions are exclusively taxable by Thailand, the country of residence. That the US also taxes these pensions, as secondary taxation authority, means that, in the interest of avoiding double taxation, the US has to absorb a Thai taxation credit. As such, the US may realize no taxes, should the Thai credits exceed the US tax bill. And Thailand, as exclusive taxation authority, gets to keep the whole tax collection, without any offset from US tax credits.

 

Thus, to say that all Thai taxation will be offset by taxes paid to the home country on this income -- in all situations -- is pure baloney. Thailand, if they have any gumption, will apply the DTA to their benefit, and apply full taxation to those monies indicated by the DTA -- and provide a tax credit for this full taxation to the home country.

 

How this will work out in practice, I don't know. Amended tax returns, maybe, to slip that Thai tax credit into home country taxation? I just know Thailand probably will not give up taxes by absorbing tax credits that the DTA says should go the other way. 

 

Whatever. For most of us, this just means our total tax bill will be the same, only, if Thailand is smart, they'll monitor what's due them via the DTAs. And tax appropriately.

It may seem like baloney from a DTA perspective but that is what the RD confirmed in the Sherrings Q&A, Q15 below

 

 

https://sherrings.com/foreign-source-income-personal-tax-thailand.html

[DonniePeverley]

At the risk of running through 231 pages, can someone give me a brief synopsis of what is going on ?

 

 

[UKresonant]

3 minutes ago, DonniePeverley said:

At the risk of running through 231 pages, can someone give me a brief synopsis of what is going on ?

 

 

If you are not in Thailand more than a cumulative total of more than 179days in the calendar year (Thai tax year) no issues.

 

Previously if you were a total of  180days cumulatively in Thailand, and became Thai  tax resident, and principally had only income from overseas. It got taxable if brought in to Thailand in the same year. If brought in the following year, it was treated as savings.

 

From 1st Jan 2024, if you earn or derive income overseas (or similar gains etc), whilst Thai Tax resident,  it is taxable if you remit it to Thailand 'in that year', and/or remit it any time in the future.

 

Thai Revenue taking more interest in overseas income, whilst you are resident in Thailand.

 

Lots of detail posted in the guide on an associated thread!

[UKresonant]

4 minutes ago, UKresonant said:

If you are not in Thailand more than a cumulative total of more than 179days in the calendar year (Thai tax year) no issues.

 

Previously if you were a total of  180days cumulatively in Thailand, and became Thai  tax resident, and principally had only income from overseas. It got taxable if brought in to Thailand in the same year. If brought in the following year, it was treated as savings.

 

From 1st Jan 2024, if you earn or derive income overseas (or similar gains etc), whilst Thai Tax resident,  it is taxable if you remit it to Thailand 'in that year', and/or remit it any time in the future.

 

Thai Revenue taking more interest in overseas income, whilst you are resident in Thailand.

 

Lots of detail posted in the guide on an associated thread!

I think it's around 28th June 2024, to be the earliest date you become Thai Tax resident this year, if you have not been out of Thailand, then new rules will start to be applied. 

[Mike Lister]

1 hour ago, DonniePeverley said:

At the risk of running through 231 pages, can someone give me a brief synopsis of what is going on ?

 

 

Can you manage 10 pages!

 

 

[mudcat]

Does anyone have a link to the Thai language U.S.-Thailand tax convention?  Putting a package together for my local RD staff and I would prefer to establish that my Social Security and local government pension are not assessible income in their native language.  

[Mike Lister]

16 minutes ago, mudcat said:

Does anyone have a link to the Thai language U.S.-Thailand tax convention?  Putting a package together for my local RD staff and I would prefer to establish that my Social Security and local government pension are not assessible income in their native language.  

 

All DTA's are linked and available for download via a single link in the document below in Para 8. 

 

 

 

[JimHuaHin]

On 2/1/2024 at 6:48 AM, norbra said:

Please find attached response from Australian Tax Office re aged pension tax liability

Apologies to the delayed reply, I just got up to this page.

 

I have to dispute this, especially the paragraph beginning "Therefore ..."

 

My Australian super fund gave members the option of taxing contributions going in, or taxing benefits received.  I opted for the former, thus the monthly payments I receive are not subject to tax, as tax has already been paid.

 

How can tax be then paid in Thailand?

 

 

 

 

[Mike Lister]

1 minute ago, JimHuaHin said:

Apologies to the delayed reply, I just got up to this page.

 

I have to dispute this, especially the paragraph beginning "Therefore ..."

 

My Australian super fund gave members the option of taxing contributions going in, or taxing benefits received.  I opted for the former, thus the monthly payments I receive are not subject to tax, as tax has already been paid.

 

How can tax be then paid in Thailand?

 

 

 

 

Tax paid in Australia can be used to offset any tax liability in Thailand, if the rate here is higher.

[norbra]

41 minutes ago, JimHuaHin said:

Apologies to the delayed reply, I just got up to this page.

 

I have to dispute this, especially the paragraph beginning "Therefore ..."

 

My Australian super fund gave members the option of taxing contributions going in, or taxing benefits received.  I opted for the former, thus the monthly payments I receive are not subject to tax, as tax has already been paid.

 

How can tax be then paid in Thailand?

 

 

 

The above information from the ATO is about Centrelink pensions.

In Your case your super is not taxable in Thailand code states tax exempt .

[norbra]

2 hours ago, JimHuaHin said:

Apologies to the delayed reply, I just got up to this page.

 

I have to dispute this, especially the paragraph beginning "Therefore ..."

 

My Australian super fund gave members the option of taxing contributions going in, or taxing benefits received.  I opted for the former, thus the monthly payments I receive are not subject to tax, as tax has already been paid.

 

How can tax be then paid in Thailand?

 

 

 

 

Some more info re your pre taxed monies brought to Thailand.

They can be assessed as taxable if the Thai tax rates are higher than the tax you have paid in Australia you may be required to make up any difference.

Thai tax rates( thb )on remittances

0 to 190,000 nill

190,000 to 300,000 5%

300,000 to 500,000 10%

Next stage 15% 

Then 20%

Government Service pensions are exempt from any Thai tax

Edited February 15 by norbra

[JimHuaHin]

15 hours ago, Mike Lister said:

Tax paid in Australia can be used to offset any tax liability in Thailand, if the rate here is higher.

 

Thank you, I am aware of that.

 

One of my points is, my super contributions were taxed, not my benefits, thus Australian taxes were paid from 1979 until 2013 (when I stopped working).  No taxes to be paid on benefits, thus no taxes paid post 2013, as benefits are considered non-taxable income.

 

Thus, no offset to Thai tax liability.

[JimGant]

5 hours ago, JimHuaHin said:

One of my points is, my super contributions were taxed, not my benefits, thus Australian taxes were paid from 1979 until 2013 (when I stopped working).  No taxes to be paid on benefits, thus no taxes paid post 2013, as benefits are considered non-taxable income.

 

Thus, no offset to Thai tax liability.

 

Thai tax returns don't even have line items for foreign tax credits. So, even if you paid home country taxes on your benefits, and not on your contributions, how you'd finagle a tax credit into your Thai tax return is still an unknown...

 

But, in the spirit of "no double taxation," I'd just come up with the amount of taxes you paid for 24 years on your contributions. Then, pro rate that amount over all and any future Thai tax obligations. If they never come up with a tax return with line items for credits, well then, just do an excel worksheet of what your Thai taxes would look like, then amortize enough of your 24 year payments to Oz to cover that Thai tax bill, and keep the paperwork in your upper left hand drawer, should the tax police come knocking (neve' hapin). But, no need to file a tax return, since you've eliminated any taxes owed. If they come up with a tax return with credit line items -- well, again amortize that 24 year chunk of change, covering a little more than your Thai tax bill (exact amount would look suspicious). Again, don't file -- no taxes owed, no fines assessed, no jail time. Easy.

 

Anyway, nothing nefarious about this. You paid one country the taxes, the other country gives you a credit for that. No tax cheating (but maybe slightly in disaccord with the DTA, where Thailand, not Australia, issues the credit. Nevermind.) You're 100% OK in the integrity block; but maybe a little wobbly in the execution mechanics. Just keep good notes on all this math.  Now, if Immigration asks for a tax return for future retirement extensions - come back to this forum and we'll kick the can down the soi a little further.....

[redwood1]

How many expats are in Thailand?..... 3 to 4 million...

 

How many members on this forum?....I dont know but I would guess over 10,000 at least...

 

How many members post regularly in this thread....I would guess around 20......

 

So there you go......Well over 99.9% of expats have very little to no interest in keeping up with the play by play action of this unworkable quagmire tax mess....

[Mike Lister]

2 minutes ago, redwood1 said:

How many expats are in Thailand?..... 3 to 4 million...

 

How many members on this forum?....I dont know but I would guess over 10,000 at least...

 

How many members post regularly in this thread....I would guess around 20......

 

So there you go......Well over 99.9% of expats have very little to no interest in keeping up with the play by play action of this unworkable quagmire tax mess....

There is estimated to be around 4 million foreigners living in Thailand but the vast majority are from bordering countries. Western expats, including retirees, appear to number around 300k.

 

The Simple Tax Guide thread has seen over 34,000 views, that's 34,000 views of the guide itself.

 

This thread however has seen over 355,000 views, that is potentially 355,000 attempts by readers to understand or find out information about the new tax rule.

 

So, there you go.....well over 100% of all Western expats have viewed this tax thread once and over 10% have downloaded the Simple Tax Guide!

 

Ball, court, yours!

 

:))

 

 

 

 

[brianthainess]

It is NOT ALL income from abroad.** Flame Removed by Moderator

[Mike Lister]

3 minutes ago, brianthainess said:

It is NOT ALL income from abroad. 

If you would have taken the time to read the tax guide or pay attention to what has been said in the many many threads on this subject, you would already understand that not all funds transferred from abroad is regarded as (taxable) income and that most people already understand that. That fact notwithstanding, if you have any questions on this subject that you wish to raise, calmly, politely unemotionally and without vulgarity, I will do my best to answer them.

 

[JimTripper]

On 2/11/2024 at 5:59 AM, DonniePeverley said:

At the risk of running through 231 pages, can someone give me a brief synopsis of what is going on ?

Sure. Forget the whole thing and have a plan B unless you are tied to Thailand for some reason. It's unlikely (but not impossible) you will be stopped at the airport on your way out.

[4MyEgo]

On 2/15/2024 at 8:54 PM, JimHuaHin said:

Apologies to the delayed reply, I just got up to this page.

 

I have to dispute this, especially the paragraph beginning "Therefore ..."

 

My Australian super fund gave members the option of taxing contributions going in, or taxing benefits received.  I opted for the former, thus the monthly payments I receive are not subject to tax, as tax has already been paid.

 

How can tax be then paid in Thailand?

 

 

 

 

 

 

Apologies if I am bringing you bad news.

 

From my limited understanding of the new code, it states that if you are a tax resident of Thailand, i.e. 180 days in a financial year I believe, and you remit money from abroad to Thailand, apart from savings, which is not an income, then it isn't taxable.

 

Now, I believe that your superannuation would be savings (forced savings) in one way or another and therefore not taxable, i.e. in Australia if you take it out after age 60.

 

It would be up to the Thai government to want to understand that interpretation, and if it would apply here in the LOS, i.e. you put money into your superannuation as future savings for your retirement, and now that you are retired, your Superannuation is savings that you draw down on, and that it was taxed going in, e.g. 15%, and no tax paid coming out, as that was the incentive for people to save for their future retirement, so as not to burden the Australian Government having to pay Age Pensions, now whether they turn around and say, yeh, well, that agreement was between you and your government when you were a resident in Australia, however now you are a resident here, and if I read correctly the DTA in particular Article's 18 & 19 provide Thailand the right to tax you here as a resident, as you are remitting your pension here, and it hasn't been taxed in Australia. 

 

Please let me know your thoughts on this, I am not saying I am right, just presenting the facts the way I see it, and it sounds like they can tax you here, as much as it irks me to say it.

 

This is particularly relevant for those living in Thailand and surviving on their Australian age-pensions, and/or on their Australian (non-government) superannuation pensions, as the tax treaty states that ONLY Thailand can tax those pensions!

 

https://www.expattaxes.com.au/update-thailand-clarifies-tax-on-foreign-income/#:~:text=This is particularly relevant for,Thailand can tax those pensions!

 

 

Edited February 17 by 4MyEgo

[TroubleandGrumpy]

On 2/17/2024 at 9:53 AM, 4MyEgo said:

 

 

Apologies if I am bringing you bad news.

 

From my limited understanding of the new code, it states that if you are a tax resident of Thailand, i.e. 180 days in a financial year I believe, and you remit money from abroad to Thailand, apart from savings, which is not an income, then it isn't taxable.

 

Now, I believe that your superannuation would be savings (forced savings) in one way or another and therefore not taxable, i.e. in Australia if you take it out after age 60.

 

It would be up to the Thai government to want to understand that interpretation, and if it would apply here in the LOS, i.e. you put money into your superannuation as future savings for your retirement, and now that you are retired, your Superannuation is savings that you draw down on, and that it was taxed going in, e.g. 15%, and no tax paid coming out, as that was the incentive for people to save for their future retirement, so as not to burden the Australian Government having to pay Age Pensions, now whether they turn around and say, yeh, well, that agreement was between you and your government when you were a resident in Australia, however now you are a resident here, and if I read correctly the DTA in particular Article's 18 & 19 provide Thailand the right to tax you here as a resident, as you are remitting your pension here, and it hasn't been taxed in Australia. 

 

Please let me know your thoughts on this, I am not saying I am right, just presenting the facts the way I see it, and it sounds like they can tax you here, as much as it irks me to say it.

 

This is particularly relevant for those living in Thailand and surviving on their Australian age-pensions, and/or on their Australian (non-government) superannuation pensions, as the tax treaty states that ONLY Thailand can tax those pensions!

 

https://www.expattaxes.com.au/update-thailand-clarifies-tax-on-foreign-income/#:~:text=This is particularly relevant for,Thailand can tax those pensions!

I am staying out of this as I said - but as an Aussie i must jump in here.

IMO the Aust/Thai DTA states that only the state paying the pension etc. to the person can tax that pension. States do not want to pay their money straight to another Government.

Pensions in Aust are taxable income - Pensions are already taxed - But the tax is not applied

There is a clause that states a person with two tax states can choose whatever state tax rates they want to be applied - meaning the tax rate that is least for them.