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

[Mike Lister]

43 minutes ago, Dogmatix said:

I don't think that a total prohibition on discussion of gifting and gift tax would enhance the usefulness of this thread to members very much.  Gifting was mentioned as being tax exempt up to the set limits by the RD in its original Q&A on P. 161/2566 with the obvious implication that gifts of foreign source income can be made in a tax exempt way.

 

There must have been a significant amount of gifting done since the Gift Tax was introduced in 2016.  What would be useful to members would be information about how this amendment has been applied by the RD.  Prohibitions on discussion of certain key aspects of P. 161/2566 or unsupported assumptions by individual members about how the RD considers gifting are not a substitute for rolling up the sleeves and collating this type of information for the benefit of members. Time spent expressing unsupported opinions could be more usefully spent rolling up the sleeves and doing the digging.

 

 

Please go back and read again the message i posted on this subject. There has not been a total ban or prohibition introduced on Gift Tax discussions. The word "ban" was first introduced in a now redacted inappropriately worded post by another member and you have now introduced the word prohibition for the first time! I trust you will be more diligent in your assessment of tax related documentation!

 

I have merely asked for members co-operation in moving the narrative away from Gift Tax and ways to avoid paying Thai tax. This is because we do not want to see the debate make the short leap from discussing avoidance, to describing evasion plus we do not want to be seen as the go to place to obtain tax avoidance measures, legal or otherwise. This has been done for several other reasons, including complaints from several members that the thread had been hijacked and a concern that the emphasis of the thread was no longer appropriate ....I shared similar concerns.

 

If you wish to have a debate on this subject, please PM me or Admin with your concerns. But as also stated previously, I see no reason to have a public debate and instead the thread and its participants should just move on.

 

As far as best use of my time is concerned: As I said in great detail recently, I have no intention of doing any research into Gift tax cases or anything similar, I leave that to the experts in such things. 

 

I appreciate you cooperation.

 

 

[Lorry]

1 hour ago, Dogmatix said:

I don't think that a total prohibition on discussion of gifting and gift tax would enhance the usefulness of this thread to members very much.  Gifting was mentioned as being tax exempt up to the set limits by the RD in its original Q&A on P. 161/2566 with the obvious implication that gifts of foreign source income can be made in a tax exempt way.

 

There must have been a significant amount of gifting done since the Gift Tax was introduced in 2016.  What would be useful to members would be information about how this amendment has been applied by the RD.  Prohibitions on discussion of certain key aspects of P. 161/2566 or unsupported assumptions by individual members about how the RD considers gifting are not a substitute for rolling up the sleeves and collating this type of information for the benefit of members. Time spent expressing unsupported opinions could be more usefully spent rolling up the sleeves and doing the digging.

 

 

You are right, and I am one of those your post seems to address.

Actually, I started diggjng, but found nothing so far.

I will dig more.

 

Thanks a lot for your criticism, I appreciate it.

Edited May 10 by Lorry

[UKresonant]

11 hours ago, Mike Teavee said:

I think most people do sit in the middle but sensibly assess the impact of getting it wrong E.g. for me... 

1. Remit income up to my Allowances + 150K ( Total of 235K) & not file a return, worse case, 2,000B fine (They'd owe me 5,000 in Withheld tax on my Bank Account interest so can take it out of that & give me the extra 3K). 
2. Do the same for the GF (Total of 210K) + "Gift" her 2x100K, worse case, (IIRC) twice the Tax due on the 200K (She's already used the 1st 150K at 0% so it would be 150K at 10% + 50K at 15% = 22,500 doubled) 45K + 2K fine=47K. 
3.  Remit the Tax Free Lump Sum from my Pension + some Capital Gains for a total of say 12Million THB = 7,460,500 (2x3,730,250) + 2K fine. 

1st 2 I've no qualms about but the 3rd one, no way...  Besides there's something intensely satisfying in having a 6 month holiday on money that you would otherwise have given to a Tax Man 😄 

Once you are over the 183 days but not past 31st Dec, also a great oppertunity to create  some silo-ed UK savings pots, unrelated to Thai Tax.

[ukrules]

21 hours ago, Mike Teavee said:

To take it to extremes I guess there is nothing to stop you taking all of your income (Dividends, Rent, Pensions, even gains from selling your house), buying assets with it, selling the assets & remitting the proceeds with no/little tax to pay.

 

An audit going back a few years would put a very quick end to that kind of practice for the audited individual

I'm going to do this but while non resident in the year of realisation and remittance, I'll also reset the cost basis of the investments that remain.

 

19 hours ago, Mike Lister said:

I think ultimately this person is a pessimist by nature.

 

This is my approach, to sum it up in one sentence : Hope for the best but expect the worst

[Mike Teavee]

1 hour ago, ukrules said:

 

An audit going back a few years would put a very quick end to that kind of practice for the audited individual

I'm going to do this but while non resident in the year of realisation and remittance, I'll also reset the cost basis of the investments that remain.

 

 

This is my approach, to sum it up in one sentence : Hope for the best but expect the worst

 

Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions that led up to the purchase of the final asset (nor would they want/be able to) as it has nothing to do with them & even if they could, they have no claims on any CGT arising up to that point, that's solely the concern/claim of the country where the asset is.

 

End of the day they just need to see the Sale Contract note showing where the money came from & if they want to query whether any CGT was due (highly doubtful) then you show them the Purchase Contract note(s), they may question why the transactions took place on the same day but it's really none of their business, you're not doing anything wrong/illegal in either country... "I bought the shares, then decided I'd rather have a Condo in Thailand so sold them & remitted the money officer - Up to Me". 

 

As I've mentioned, the UK has a 30 day rule around UK Residents selling/repurchasing assets to crystalise CGT and 5 year rules around Expats (to stop people becoming an Expat for 1 year selling  all of their assets free of CGT & then moving back to the UK) but Thailand has no such rules and treats CGT as income tax. 

 

Now if Thailand taxed the whole of your worldwide income then it would be a whole different matter (& I would be out of here). 

 

Edited May 10 by Mike Teavee

[Mike Lister]

15 minutes ago, Mike Teavee said:

 

Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions that led up to the purchase of the final asset (nor would they want/be able to) as it has nothing to do with them & even if they could, they have no claims on any CGT arising up to that point, that's solely the concern/claim of the country where the asset is.

 

End of the day they just need to see the Sale Contract note showing where the money came from & if they want to query whether any CGT was due (highly doubtful) then you show them the Purchase Contract note(s), they may question why the transactions took place on the same day but it's really none of their business & you're not doing anything wrong/illegal in either country "I bought the shares, then decided I'd rather have a Condo in Thailand so sold them & remitted the money officer - Up to Me".

 

 

Now if Thailand taxed the whole of your worldwide income then it would be a whole different matter (& I would be out of here). 

 

"Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions".

 

As you say, if you apply that same logic to any asset in the home country, all you have to do is sell the asset, pay the home country tax and convert it to savings, that's one possible answer.

 

But does that same scenario apply to  income also? Bank the income and and convert it to savings, after which it can be remitted as savings, free of Thai tax.

 

Hmmm, it's very appealing but that picture doesn't look right!

[Mike Teavee]

43 minutes ago, Mike Lister said:

"Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions".

 

As you say, if you apply that same logic to any asset in the home country, all you have to do is sell the asset, pay the home country tax and convert it to savings, that's one possible answer.

 

But does that same scenario apply to  income also? Bank the income and and convert it to savings, after which it can be remitted as savings, free of Thai tax.

 

Hmmm, it's very appealing but that picture doesn't look right!

 

Not quite like that, as the process would go:-

1. Sell the Asset & pay any home country tax
2. Purchase a new asset (could be the same company shares or a completely different asset class, to keep it simple lets say we're selling a house & buying some shares). 
3. Sell the new asset & remit the money reporting any CGT gained on the new Asset (I.e. nothing to report)

The sale of the 1st asset crystalises any CGT Gain/Loss, purchasing the new Asset sets the baseline cost from which future CGT is calculated, but if you put the proceeds from the 1st Sale into "Savings" then you're still carrying the original CGT part of it so if TRD asked for the source of the Savings there would be a CGT element to it. 

 

 

There are no reasons why you could not do something similar with Income...

1. Get the Income & pay any home country tax
2. Purchase an Asset with the Income
3. Sell the Asset & remit the money reporting any CGT gained

In fact that is exactly how most people obtained the shares they own, the only difference being how long between steps 2 & 3.

 

I have shares I've held for 35 years & have "Owned" Shares for < 3 hours, there is no difference except for tapered CGT relief & as you've said in previous posts it doesn't seem right that Thailand can claim the CGT based on the original purchase price many years ago, but without tapered relief that is exactly what they do, however the flipside is that there are also no rules/guidelines around the minimum length of time you need to keep an asset before the original source of the asset no longer counts. 

 

There really is no difference between...

1. Buying shares 10 years ago, selling them 5 years ago to purchase new shares, selling the new shares & remitting the money  
2. Buying shares 10 years ago, selling them 5 minutes ago to purchase new shares, selling the new shares & remitting the money.

 

Edited May 10 by Mike Teavee

[Mike Lister]

20 minutes ago, Mike Teavee said:

 

Not quite like that, as the process would go:-

1. Sell the Asset & pay any home country tax
2. Purchase a new asset (could be the same company shares or a completely different asset class, to keep it simple lets say we're selling a house & buying some shares). 
3. Sell the new asset & remit the money reporting any CGT gained on the new Asset (I.e. nothing to report)

The sale of the 1st asset crystalises any CGT Gain/Loss, purchasing the new Asset sets the baseline cost from which future CGT is calculated, but if you put the proceeds from the 1st Sale into "Savings" then you're still carrying the original CGT part of it so if TRD asked for the source of the Savings there would be a CGT element to it. 

 

 

There are no reasons why you could not do something similar with Income...

1. Get the Income & pay any home country tax
2. Purchase an Asset with the Income
3. Sell the Asset & remit the money reporting any CGT gained

In fact that is exactly how most people obtained the shares they own, the only difference being how long between steps 2 & 3.

 

I have shares I've held for 35 years & have "Owned" Shares for < 3 hours, there is no difference except for tapered CGT relief & as you've said in previous posts it doesn't seem right that Thailand can claim the CGT based on the original purchase price many years ago, but without tapered relief that is exactly what they do, however the flipside is that there are also no rules/guidelines around the minimum length of time you need to keep an asset before the original source of the asset no longer counts. 

 

There really is no difference between...

1. Buying shares 10 years ago, selling them 5 years ago to purchase new shares, selling the new shares & remitting the money  
2. Buying shares 10 years ago, selling them 5 minutes ago to purchase new shares, selling the new shares & remitting the money.

 

All entirely credible and possible, I have no challenge. But coming back to your earlier statement:

 

"Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions".

 

What if in your most recent post, you didn't buy back the shares and simply sold them and declared them as savings, which at that point is what they are.......does the TRD still only have the right to audit what you remit?

[Mike Teavee]

43 minutes ago, Mike Lister said:

All entirely credible and possible, I have no challenge. But coming back to your earlier statement:

 

"Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions".

 

What if in your most recent post, you didn't buy back the shares and simply sold them and declared them as savings, which at that point is what they are.......does the TRD still only have the right to audit what you remit?

 

Yes... They're only auditing what you've remitted & it's on you to tell them the source of the money which, in the case of the sale of an asset, includes whether any CGT was involved.  To show this you would provide evidence of the Purchase & Sale of that asset.

 

In your case the money in your "Savings" came from the sale of the original asset so includes the CGT element of that sale, in my case the money in my "Savings" came from the sale of the new asset so includes the CGT element of that sale. 

 

Example 1:

I sell my house, get a £250K gain put it into a "Savings" account & at some point in the future remit the money into Thailand... TRD ask me where the money came from, I say the sale of my house, they ask for purchase/sale details & I'm liable for tax on the gain from the house. 

 

Example 2:

I sell my house, get a £250K gain use it to purchase some shares, sit on these for 5 years, sell them & remit the money into Thailand... TRD  ask me where the money came from, I say the sale of my shares, they ask for purchase/sale details & I'm liable for tax on the gain from the shares.

 

Example 3:

I sell my house, get a £250K gain use it to purchase some shares, sit on these for 5 minutes, sell them & remit the money into Thailand... TRD  ask me where the money came from, I say the sale of my shares, they ask for purchase/sale details & I'm liable for tax on the gain from the shares.

 

In Examples 2 & 3 the original gain on the sale of my house doesn't come into it, nor does any other source of money used to purchase the new shares, the starting point for TRD is the Asset not what was used to purchase it. 

 

 

 

Now, Example 3 is an extreme example & you might be pushing your luck with them on a 10 Million Baht transfer but strictly speaking there is no different between that & Example 2 (especially if during the 5 years no gains were made on the shares) & I don't think anybody would argue that the gains from the original sale of the house come into it in Example 2.

 

However, If I were planning to do this on that kind of scale then I would probably look to do the Purchase & sale in different calendar years (i.e. Buy the Asset late December, sell it early Jan) as that's what TRD are used to operating in. 

 

 

Edited May 10 by Mike Teavee

[Presnock]

On 9/18/2023 at 10:00 AM, Mike Teavee said:

Could be they claim it & force you to reclaim it via a Tax Return in Thailand or your home country or both. 

yeah they need to come out with the policy completely thought out - i.e. if we have unassessable income remitted, do we ignore get a tax id number? do we ignore filling out forms that have no place for unassessable income, do we have to provide proof of our govt pensions taxed already? I would think that by now after coming out with this taxation last year, that some definite decisions on what exactly we ex-pats can expect from the Thai Revenue Department.  Seems that each is a tax entity on its own so we the ex-pats need the govt to explicitly advise us what they need from us or this might deter people from retiring here or living here less than 180 days, thus causing a loss of funds that they could have.  Just saying as we have been hearing all sorts of rumors from forum members, tax agents, etc and we still are in the dark with the 180th day rapidly approaching.  I am not overly concerned as I feel I will not be affected by these tax interpretations but, TIT so who really knows?  Good luck to all

[Mike Lister]

4 minutes ago, Presnock said:

yeah they need to come out with the policy completely thought out - i.e. if we have unassessable income remitted, do we ignore get a tax id number? do we ignore filling out forms that have no place for unassessable income, do we have to provide proof of our govt pensions taxed already? I would think that by now after coming out with this taxation last year, that some definite decisions on what exactly we ex-pats can expect from the Thai Revenue Department.  Seems that each is a tax entity on its own so we the ex-pats need the govt to explicitly advise us what they need from us or this might deter people from retiring here or living here less than 180 days, thus causing a loss of funds that they could have.  Just saying as we have been hearing all sorts of rumors from forum members, tax agents, etc and we still are in the dark with the 180th day rapidly approaching.  I am not overly concerned as I feel I will not be affected by these tax interpretations but, TIT so who really knows?  Good luck to all

"if we have unassessable income remitted, do we ignore get a tax id number?"

The TRD Code clearly says  you do not need a TIN.

 

"do we ignore filling out forms that have no place for unassessable income?"

If the form doesn't ask for it, what choice is there.

 

"do we have to provide proof of our govt pensions taxed already?"

You only need to provide proof, if you are subsequently audited or it is requested.

 

 

 

[Presnock]

25 minutes ago, Mike Lister said:

"if we have unassessable income remitted, do we ignore get a tax id number?"

The TRD Code clearly says  you do not need a TIN.

 

"do we ignore filling out forms that have no place for unassessable income?"

If the form doesn't ask for it, what choice is there.

 

"do we have to provide proof of our govt pensions taxed already?"

You only need to provide proof, if you are subsequently audited or it is requested.

 

 

 

Thanks Mike, exactly my feeling too!  just wish that those pushing the taxing would come out with the COMPLETE program in a clear and concise manner so that everyone could just relax.  Thanks for all your work to date...must seem like having a new career since you have to spend so much time repeating because people just can't accept what might or might not be required.  take care be safe enjoy paradise

[redwood1]

30 minutes ago, Presnock said:

Thanks Mike, exactly my feeling too!  just wish that those pushing the taxing would come out with the COMPLETE program in a clear and concise manner so that everyone could just relax.  Thanks for all your work to date...must seem like having a new career since you have to spend so much time repeating because people just can't accept what might or might not be required.  take care be safe enjoy paradise

 

Just look around you...How many things in Thailand are murky and unclear? Loads of things..

 

Weed laws

Vaping enforcement

Alcohol sales hours enforcement..

The 10,000 baht payday for Thais..

How about the law landlords cant charge more than government rate for electric...This one was not worth the paper it was written on...lol

 

Need I go on...

 

They quite like things in a state of murkiness in Thailand...And this tax is a bonanza of murkiness, that I doubt will ever be made clear.....

 

Just the way they like things....

[Presnock]

10 minutes ago, redwood1 said:

 

Just look around you...How many things in Thailand are murky and unclear? Loads of things..

 

Weed laws

Vaping enforcement

Alcohol sales hours enforcement..

The 10,000 baht payday for Thais..

How about the law landlords cant charge more than government rate for electric...This one was not worth the paper it was written on...lol

 

Need I go on...

 

They quite like things in a state of murkiness in Thailand...And this tax is a bonanza of murkiness, that I doubt will ever be made clear.....

 

Just the way they like things....

Has been this way since I first came here in 1972...but, as long as one doesn't let all the "murkiness" get you down, it can still be like a paradise compared to our home country.

 

[Mike Lister]

1 hour ago, Presnock said:

Thanks Mike, exactly my feeling too!  just wish that those pushing the taxing would come out with the COMPLETE program in a clear and concise manner so that everyone could just relax.  Thanks for all your work to date...must seem like having a new career since you have to spend so much time repeating because people just can't accept what might or might not be required.  take care be safe enjoy paradise

There's lots of others here who are putting in outstanding effort and actually being extremely helpful.

[Lorry]

10 hours ago, Mike Teavee said:

Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions

Is that written in some law, or is it what you think and hope?

[sandrew33]

Thai Revenue Department primer released on tax for individuals in Thailand from 1 January 2024 (see attached) 

 

Short version: If you are living in Thailand more than 180 days a year and derive income outside Thailand and bring it into Thailand (say a pension) then it is prima facie subject to tax here. 

 

 

How_do_foreigners_living_in_Thailand_pay_tax__1715414462.pdf

Edited May 11 by sandrew33

[Mike Lister]

18 minutes ago, sandrew33 said:

Thai Revenue Department primer released on tax for individuals in Thailand from 1 January 2024 (see attached) 

 

Short version: If you are living in Thailand more than 180 days a year and derive income outside Thailand and bring it into Thailand (say a pension) then it is prima facie subject to tax here. 

 

 

How_do_foreigners_living_in_Thailand_pay_tax__1715414462.pdf 1.23 MB · 5 downloads

Thanks Andrew, that's been posted here a number of times.

[treetops]

Deleted.

Edited May 11 by treetops

[SingAPorn]

When I read all the hassle people put themselves. Just reduce your length of stay in Land of Scams (that is if you can).

 

Many falangs who own businesses are dead scared that they will loose their valuable clients - the foreigner retiree and mainly his pension, so some go out of the way to try and convince people to stay on here and pay taxes.

 

For those who live here full time, start looking at other countries around. Why stay anyplace where they dislike so much foreigners-falangs whatever ?

Edited May 11 by SingAPorn

[sandrew33]

12 minutes ago, Mike Lister said:

Thanks Andrew, that's been posted here a number of times.

My bad, hadn’t noticed it. Long thread though 🙂 

 

As someone as a long history in tax I think the topic highlights one of the ever present issues in tax and that is the difference between the law (in a black letter sense) and practice of the authorities established over many years. They often diverge and so when basic principles are restated by the authorities with even a minor-ish tweak it causes confusion. 

 

The general trend, in most jurisdictions, is that information sharing across borders (via CRS and FATCA) and technology raises the risk of being picked up for review and at that point what will matter is the law as its being interpreted by the authority at that time as opposed to “well I’ve been here 20 years and its never been an issue”. 

 

Interesting times for expats who are dancing the residency dance at both ends (home and here in Thai). 

[Mike Lister]

1 minute ago, sandrew33 said:

My bad, hadn’t noticed it. Long thread though 🙂 

 

As someone as a long history in tax I think the topic highlights one of the ever present issues in tax and that is the difference between the law (in a black letter sense) and practice of the authorities established over many years. They often diverge and so when basic principles are restated by the authorities with even a minor-ish tweak it causes confusion. 

 

The general trend, in most jurisdictions, is that information sharing across borders (via CRS and FATCA) and technology raises the risk of being picked up for review and at that point what will matter is the law as its being interpreted by the authority at that time as opposed to “well I’ve been here 20 years and its never been an issue”. 

 

Interesting times for expats who are dancing the residency dance at both ends (home and here in Thai). 

Those things are very true. The other factor of course is that foreigners here have gone from believing that Thailand was a no tax country, as far as they are concerned, hence they didn't need to understand anything about Thai tax, to, full on needing to know everything and finally realising the tax laws apply to them too.

[Mike Teavee]

1 hour ago, Lorry said:

Is that written in some law, or is it what you think and hope?

Thailand only taxes remittances & only has the right to audit what you remit, they cannot go digging through the whole history of  transactions

Both facts are not 100% true, but are correct in the context of what I was replying to.... 

 

For the 1st point, Thailand taxes all income arising in Thailand & income remitted into Thailand https://www.rd.go.th/english/6045.html (Which is the point we were discussing).

 

For the 2nd point, Thailand can ask you to provide any information they like & if you don't provide it can make an "Assessment" of how much Tax they think you owe whether you owe it or not, it's then up to you to challenge the ruling & prove that you don't owe it which would involve you providing them all of the information they asked for & explaining why it's not relevant - But the same is true of any money that you remit into Thailand.

 

But the fact is that Capital Gains is calculated as the difference between the Cost & Proceeds of an Asset purchase/sale, it's only cumulative in the country of the Asset for calculating your tax obligations there - This is why in the UK people will often "Bed & Breakfast" their assets at the End/Start of the Tax year to crystallise Gains & Re-baseline the "Cost" of the asset for a future sale. 

 

Example

I actively trade in a stock & make 100% each time, I start with £10K which becomes £20K which becomes £40K which becomes £80K, on each sale I satisfy my UK CGT obligations (though pay zero tax as I'm an expat, not 100% true with the 5 year rule but won't go into that here).

I then remit the final sale proceeds to Thailand, they are going to calculate the gain as £80K proceeds minus £40K cost = £40K, NOT £80K proceeds minus £10K costs.

 

If instead of remitting the £80K I buy some more shares & sell these shortly after the Capital Gain/Loss will be on the Proceeds minus the £80K costs so CGT is likely to be negligible if not negative. 

 

However it's often said that Tax is as much an "Art as it is a Science" & doing this for large transfers might not pass the "Sniff Test" as @Mike Listerlikes to call it, so it would be advisable to leave some time between the final purchase/sale even though technically there is no difference.   

 

 

The "Science" says it's just the gains on the final asset sale, the "Art" is passing the Sniff Test.

 

 

 

Edit: As an aside, It's crazy to think that they would/could go through every buy/sell you've ever made to work out where every penny that went into the purchase of the final asset came from, I keep pretty detailed records & I couldn't do it as I've traded in some of the assets for 35 years Plus a lot of them were "Gifted" to me as part of Performance Bonuses for the Bank I worked for & I wouldn't know where to start calculating the Book Value/"Purchase Price" of those. they had a nominal book value at the time but that was so long ago it's mute as far as the UK is concerned.... And then there's all the Drip/Scrip dividends over the years which included a bonus element... My head hurts just thinking about it!

Edited May 11 by Mike Teavee

[Lorry]

2 hours ago, sandrew33 said:

Thai Revenue Department primer released on tax for individuals in Thailand from 1 January 2024 (see attached) 

 

Short version: If you are living in Thailand more than 180 days a year and derive income outside Thailand and bring it into Thailand (say a pension) then it is prima facie subject to tax here. 

 

 

How_do_foreigners_living_in_Thailand_pay_tax__1715414462.pdf 1.23 MB · 7 downloads

Really nothing new here. Just repeating old stuff. They obviously really mean it.

 

About residency requirement: income earned in a year you are not tax resident is tax free. Income earned in a year you were tax resident, later remitted in a year you were not tax resident? No clear answer. Looks to me like it's taxable. 

 

About the kinds of income specified in P 161/2566: they conveniently forget to mention that only the listed kinds of income are taxable.

 

About DTA: they know only tax credits. They dont talk about cases of exclusive taxation in another country.

 

About necessary documents: must be in English or Thai. Tax Payment Certificate issued by foreign tax authority is recommended.

 

My conclusion: do I want to deal with them? No.

Solution: 1. Don't bring money to Thailand,  2. Stay less than 180 days a year.

 

 

Edited May 11 by Lorry

[Lorry]

1 hour ago, Mike Teavee said:

"Bed & Breakfast" their assets

This seems to be a specialty of UK tax law.

It's not necessarily similar in other countries. 

1 hour ago, Mike Teavee said:

My head hurts just thinking about it!

Agreed

[Mike Teavee]

13 minutes ago, Lorry said:

This seems to be a specialty of UK tax law.

It's not necessarily similar in other countries. 

Am sure it will be slightly different in each country but the principle is the same, you sell an asset to lock in gains & use your tax free allowance. 

 

E.g. a quick Google tells me that the allowance in Germany is €1,000, so presumably I could buy an asset for €1,000 & if it doubled, sell it for €2,000 at the end of the Tax year without having to pay any tax. 

 

If I thought there were further gains to be made on the asset I could buy it back for €2,000 and the baseline for CGT will be the €2,000 that I paid for it so if I then sold it the next Tax Year for €3,500 I would only pay tax on €500 (€3,500 proceeds - €2,000 cost).

 

If I didn't do the "Bed & Breakfast" during the 1st Tax Year to crystalise the gain, then the tax due on the final sale would be on €2,500 (€3,500 proceeds - €1,000 costs).

 

Use it or Lose it 🙂 

[UKresonant]

11 hours ago, Mike Teavee said:

 

Yes... They're only auditing what you've remitted & it's on you to tell them the source of the money which, in the case of the sale of an asset, includes whether any CGT was involved.  To show this you would provide evidence of the Purchase & Sale of that asset.

 

In your case the money in your "Savings" came from the sale of the original asset so includes the CGT element of that sale, in my case the money in my "Savings" came from the sale of the new asset so includes the CGT element of that sale. 

 

Example 1:

I sell my house, get a £250K gain put it into a "Savings" account & at some point in the future remit the money into Thailand... TRD ask me where the money came from, I say the sale of my house, they ask for purchase/sale details & I'm liable for tax on the gain from the house. 

 

Example 2:

I sell my house, get a £250K gain use it to purchase some shares, sit on these for 5 years, sell them & remit the money into Thailand... TRD  ask me where the money came from, I say the sale of my shares, they ask for purchase/sale details & I'm liable for tax on the gain from the shares.

 

Example 3:

I sell my house, get a £250K gain use it to purchase some shares, sit on these for 5 minutes, sell them & remit the money into Thailand... TRD  ask me where the money came from, I say the sale of my shares, they ask for purchase/sale details & I'm liable for tax on the gain from the shares.

 

In Examples 2 & 3 the original gain on the sale of my house doesn't come into it, nor does any other source of money used to purchase the new shares, the starting point for TRD is the Asset not what was used to purchase it. 

 

 

 

Now, Example 3 is an extreme example & you might be pushing your luck with them on a 10 Million Baht transfer but strictly speaking there is no different between that & Example 2 (especially if during the 5 years no gains were made on the shares) & I don't think anybody would argue that the gains from the original sale of the house come into it in Example 2.

 

However, If I were planning to do this on that kind of scale then I would probably look to do the Purchase & sale in different calendar years (i.e. Buy the Asset late December, sell it early Jan) as that's what TRD are used to operating in. 

 

 

 

"Example 3:

I sell my house, get a £250K gain use it to purchase some shares, sit on these for 5 minutes, sell them & remit the money into Thailand..."  I would worry to much and would wait until the contract settlement dates.

 

I presume the gain is irrelevant to Thai RD once you are both less than 179days and more than 183 days (or other criteria) in the UK, probably 6th April to 31st December is the sweet spot for this, 183 days, days  for transaction, 30 days for share B&___RPs, SWIFT transfers etc

 

I'm thinking;-

They could ask for source but the share purchase would be co-mingled likely, the main thing is exclusion of large transaction to when they cannot claim fiscal priority under (normally) article 4 of the DTA, (assuming all UK requirements have been complied with).

I would not want to present documents, where after 2024 they note, oh you were Thai Tax resident at that point.

 

NOT something at the moment, Just wanting to Tag on;-.

What if they , whilst you are tax resident, know your total pension  income (and say only 70% is sent to TH), and say it is Taxable now or in the future when remitted (until that value is used up, which for me would be to demonstrate home country expenditure).

 

Any planning should have a surface scan of "What if" they moved to Global Taxation (Though I think that would not be a a good move for Thailand). We have a danger of becoming to entrenched in the time now scenario.

 

Edited May 11 by UKresonant

[Lorry]

18 minutes ago, UKresonant said:

NOT something at the moment, Just wanting to Tag on;-.

What if they , whilst you are tax resident, know your total pension  income (and say only 70% is sent to TH), and say it is Taxable now or in the future when remitted (until that value is used up, which for me would be to demonstrate home country expenditure).

 

Any planning should have a surface scan of "What if" they moved to Global Taxation (Though I think that would not be a a good move for Thailand). We have a danger of becoming to entrenched in the time now scenario.

Once they introduce taxation of your worldwide income they will want to see your UK tax declaration. Many countries work like this

[UKresonant]

23 minutes ago, Lorry said:

Once they introduce taxation of your worldwide income they will want to see your UK tax declaration. Many countries work like this

Everything I use is already taxed at source, or under some UK Gov authorized financial product structure, tax is adjusted via coding to the various sources. As they said, they can see everything on their screen.

I would have to ask them for a letter of confirmation most likely, if required.

[stat]

3 hours ago, Lorry said:

Once they introduce taxation of your worldwide income they will want to see your UK tax declaration. Many countries work like this

There is zero! indication that Thailand plans to introduce a ww income tax on unremitted income. ZERO!