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

[Lorry]

So, they are serious and it's not just a fluke RD order.

Savings are not automatically safe (details see below).

It will be a bureaucratic nightmare, it's probably better to leave. 

 

Q1 already answers one question that is often asked: income from years past, is that still considered income (or is it savings)? How far will they go back?

In the answer, they go back 4 years - that gives you some idea.

Q2 doubles down: "no matter when that income was incurred" (in Q9 its 17 years)

 

Q8 endorses the obvious solution: bring your foreign income to Thailand in a year in which you stay less than 180 days in Thailand. This solution was mentioned before, it has been recommended by a big accounting firm. 

 

Q9 clarifies once more that only foreign income from years in which you were a tax resident in Thailand will be taxed (when you bring it into Thailand) - so all your saved income from the time you lived and worked in farangland will not be taxed.

 

Q10 they want to use the tax credit method for  DTAs. This can only work if the taxpayer proves for which income (how much?) he paid how much tax. Logically, he will have to translate, certify and legalize proof of income and his foreign tax returns (which is what TrouleandGrumpy's tax adviser said). Every year.  Have fun!

BTW sometimes a DTA doesn't use the tax credit method but says that certain types of income are just not taxable in Thailand.  It remains to be seen whether the RD will follow these rules.

Edited October 5, 2023 by Lorry

[Lorry]

Conclusion:

 

You won't be able to handle this without a tax adviser in Thailand (whom you have to pay).

You will still have to deal with your home country's bureaucracy by yourself (like having your country's tax office produce documents in a format Somchai the RD inspector will accept).

 

All those who think "I don't have to do anything because my Superfixation pension from Gambia is not taxable here, according to our DTA" are walking on very thin ice (Q10)

 

Most people won't have to pay more tax than several thousand dollars a year. It's a problem for people who really don't have more than 65000 (or even less than that). 

Edited October 5, 2023 by Lorry

[JimGant]

17 hours ago, Dogmatix said:

It is now a policy of the previous government which current government may not like much and might not feel very bound by it.

Then, they'd be pretty stupid, to torpedo an incentive to bring in (or maintain) wealthy pensioners and global citizens. Actually, this new gov't has shown several positive inclinations -- and not much stupidity. We'll see....  In any event, as a Yank, these new rules won't affect my total tax bill, as I pay Uncle Sam on all my worldwide income -- but maybe in future years Thailand will get to keep the tax on my IRA required minimum distribution -- and that amount will be subtracted out of my US tax return as a credit. Ho hum.

[redwood1]

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

[K2938]

2 hours ago, Lorry said:

1.

 

Question: What are the principles of the Revenue Department Order No. P. 161/2023 dated September 15, 2023?
 Answer: Revenue Department Order No. P. 161/2566 is an explanation of the legal principle according to Section 41, paragraph two, that a person has a duty to pay personal income tax.  from foreign sources of income  When entering into the following elements: (1) a person has assessable income from foreign sources;  In the tax year that is in  Thailand from 180 days or more and
 (2) that person brought such assessable income into Thailand in that tax year;  or in subsequent tax years
 Result: If both elements above are complete, that person has a duty to bring in money.  That assessment should be included in the calculation for personal income tax.  In the tax year received  Bringing that assessable income into Thailand
 Example: In 2023, Mr. A. is in Thailand for a total of 200 days. Mr. A. has assessable income from renting property located abroad.  By receiving rent money  into a bank account located abroad. Later in 2027, Mr. A. transferred the said money.  into a bank account in Thailand, Mr. A must bring the said assessable income  that have been imported into Thailand are included in the calculation for personal income tax for the tax year 2027.

@Lorry  Thank you so much for your tremendously useful translation of the Q&A on the proposed remittance tax changes from the Thai Revenue Department.  Highly appreciated!

Edited October 5, 2023 by K2938

[Jingthing]

Condo sales people in expat havens are gonna be schvitzing!

The more I read these titles -- you don't have to worry about this -- the more I worry.

Sounds like a total cluster muck in the making. 

[Lorry]

PS reading the Q&A again,  there is a hitch:

They say many times, that they are only taxing income from years in which you have been tax resident in Thailand (e.g. rental income from renting out your London flat in 2020, when you stayed 200 days in Thailand)

This income will  be taxable when you bring it into Thailand,  no matter in which year. 

Nowhere do they explicitly state that you also have to be a tax resident in the year the money is brought into Thailand. If that's not necessary, the consequences would be enormous. You could owe taxes for sending old income from 2020 (or 1999) into Thailand even if in the year of sending you are not in Thailand at all. The loophole would be closed,  but if you ever have stayed in Thailand more than 180 days, you better never send money into Thailand ever after.

[redwood1]

And what have I learned after 71 pages?......Not much lol...........

 

Except that a person international income, pension and tax situation is not the same as anyone elses money situation......Very Complicated, throw in tax treaties and it gets more complex for people here to figure out...

 

Its all such a complex mess the Thais will zero chance of making this work..

Edited October 5, 2023 by redwood1

[CTwelve]

31 minutes ago, redwood1 said:

Its all such a complex mess the Thais will zero chance of making this work..

Imagine the Thai Inland revenue service being tasked with endless paper trails for every single one of the millions of foreign residents living in the country.... It is not happening. 

 

I expect there will be an annual tax declaration form, probably completed at the yearly immigration office visit with the threat of occasional spot checks.

[stat]

3 hours ago, redwood1 said:

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

Yeah but it explains the law. So it has pratically the same effect as a law. as long as the order stands. However the pm or a court canmore easily nullify said order.

[TravelerEastWest]

17 hours ago, Guavaman said:

Fellow aliens subject to the income tax system in the Land of Smiles:

 

It is highly unfortunate for all AN members that the OP “More details on Thai taxation of overseas income” referred to misinformation published by ScanAsia as “More details on Thai taxation of overseas income October 3, 2023 - by Gregers Møller.

 

I suggest that AN readers completely delete the content of these postings from their memories, and immediately cease referring to them in posts and comments on AN to reduce the confusion created due to these posts.

 

What these “journalists” may have been referring to is the recent online publishing by the Legal Division of the Revenue Department Public Relations News on 2 Oct 2023 of “Q&A (in Thai) on this Revenue Department webpage:  Q&A คำสั่งกรมสรรพากร ที่ ป.161/2566 ลงวันที่ 15 กันยายน พ.ศ.2566

 

This webpage presents an informative clarification in a well-formatted set of 11 questions, answers, and examples (in Thai) regarding the recent Order by the Director General of the Revenue Department for use by RD officials in implementing the new Order.

https://www.rd.go.th/fileadmin/centralize/news_law_update/2566/QnA41_2.pdf

 

I have read these questions, answers, and examples in Thai, but I realize that many AN readers are illiterate in the language in which they have tax residency = Thailand. 

 

I suppose that these Q&As will eventually be published in an official English translation by the Revenue Department. In the interim, with the aim to reduce the stress caused by uncertainty due to the recent Order of the Director General of the Revenue Department, I am offering herewith the partial translation from Google of the Q&A posting to help you to begin to think through a strategy to respond to the official order.

 

QUESTION #1

Question: Order of the Revenue Department No. P. 161/2023 dated September 15, 2023.

How do you steal a bear? [What are the principles]

QUESTION #2

Question: Revenue Department Instruction No. P. 161/2023, dated 15 September 2023.

 How do I use deletion?  [What are the effects and when are they effective?]

QUESTION #3

What does "Resident in Thailand" mean?

QUESTION #4

What are the types of assessed income that must be subject to income tax under Section 41?, the second paragraph of the Revenue Code?

ANSWER:

Money has not been assessed from foreign sources at If you stay, you are forced to pay income tax including assessable income according to Section 40 (1) to (8) of the Revenue Code.

However, if it is assessable income received Tax exemption according to law. Taxpayers do not have to bring the assessable income is taxed in Thailand such as receiving an inheritance or receiving income received from the support of parents and trusted people, or marrying a married couple, only the money that is not received exceeding 20 millions of baht for the entire tax year.

QUESTION #5

If you use the money to buy stocks Borrow a foreign loan and receive interest crumbling from holding stocks and bonds. Later, the principal and interest were brought back into Thailand.

You must bring the principal and interest crumbling. Let's gather together the words to calculate income tax for natural persons. Yes or no?

QUESTION #6

If it is income based on assessment not known before 2024 but imported into Thailand in 2024, will I have to pay taxes or not?

QUESTION #7

If it is money, have you relied on an incorrect assessment expected to be received in 2023 and imported into Thailand.

In 2023, will I have to pay tax or not?

QUESTION #8

If you are not residing in Thailand for 180 days or more in a tax year, but have the funds to rely on this assessment. From the source of income Foreign persons in such tax year are subject to income tax. Individuals, when the income they relied on for assessment, did they return to Thailand or not?

QUESTION #9

If a person goes to live, work, or carry on a business in foreign countries. After a long time, he later wanted to come back and live in Thailand, so he brought his savings from working or operating a business abroad, such person must pay taxes on the use of that accumulated money have you entered Thailand or not? [when remitted to Thailand]

ANSWER:

No, you must pay taxes in the case of using money accumulated from doing work or business abroad into Thailand because such accumulated money has a place come from the money has been based on the evaluation Gidki [activities] occurred in the year of the specified tax year at the person has been in Thailand for less than 180 days.

For example, Mrs. D. is a Thai national and has been living in China since 2007 onwards. But in 2024, Mrs. D. wants to travel back to live in Thailand permanently, so the money accumulated from operating in China was brought back into All of Thailand. As such, Mrs. D. is not obliged to pay personal income tax for money imported into Thailand in 2024, because such accumulated money has a place come from income depends on the assessment of Gidki [activity] arose in the year of this tax that D. not the name of the person residing in Thailand.

QUESTION #10

If the income subject to assessment is not imported into Thailand for a year, the income received is subject to tax. If you have earned income abroad, if you bring it back in, you must bring it at a loss. Is tax collection in Thailand again a year? Is it a duplicate, double tax collection or not?

ANSWER:

There is no duplicate income tax in this case. Who is a person, who has a person, who has a place at tax address in Thailand (I'm in Thailand. Starting from 180 days ) can bring tax at tax at save the money for foreigners to use as credit and withhold taxes at must wasted in Thailand in the tax year introduced Assessable income can be brought into Thailand.

According to the provisions of the Double Tax Convention, Thailand is a contracting party with that country.

QUESTION #11

Revenue Department Order No. P.161/2023 is not legal. Tax victims must comply with the regulations.

Is the Revenue Department order like this or not?

ANSWER:

It is not a law, but a word explaining the law, Section 41. The second paragraph wraps Revenue Code.

Tax victims still have the burden of having to comply with the law in paying taxes, which is an order.

The Revenue Department, Category P., is an order that the Director-General, who is in the position of Comptroller, orders.

Employees of the Revenue Department are considered as Practice guidelines for giving advice and advice to tax victims to enable the m to comply with the law correctly.

 

I spent 2 hours of pasting and translating in Google to come up with this. I only expanded the answers and example for the issues that I think are most pertinent for most expats.  If you desire more comprehensive translation -- as the Thais say: "up to you". 

 

I

Actually being able to read Thai at the native speaker level is only step one - you also need an education in Thai tax laws and probably the laws of other countries depending on the situation. Google translations are of liomited value...

 

You can't rely on what the reveune department says anywhere in the world.

 

You can't rely on Thai CPAs and lawyers unless they are specialists in taxation. In America as an example the trend is to have a masters degree in taxation - which you get after your degree in law or accounting. Having actual recent experience is also important. I have a masters degree in taxation but it was from a long time ago and I am retired from the tax world - I am not qualified at all.

 

Lets relax for now, read the news and lets see what happens...

[tomacht8]

As unclear as mud. If I want to buy a condo and send, for example, 5 million Thai baht to my Thai bank, should I pay taxes on it or provide any income tax documents from my home country? LOL. None of the local Thai tax officials can understand my tax notices at all. I'm afraid that money sent from abroad will first be frozen in the Thai bank and you won't be able to access your money. A horror thought.

[K2938]

This wonderful new remittance tax rule will also have a very negative effect on the private hospital sector in Thailand.  Because for anything where there is no top urgency for Thai tax residents hit with remittance tax like major planned surgery it now makes a lot more sense to get this done in Malaysia or Singapore with direct payment from offshore funds instead of going to a Thai hospital where there would be an additional 35% remittance tax on top of the amount invoiced.

Edited October 5, 2023 by K2938

[Conno]

54 minutes ago, K2938 said:

This wonderful new remittance tax rule will also have a very negative effect on the private hospital sector in Thailand.  Because for anything where there is no top urgency for Thai tax residents hit with remittance tax like major planned surgery it now makes a lot more sense to get this done in Malaysia or Singapore with direct payment from offshore funds instead of going to a Thai hospital where there would be an additional 35% remittance tax on top of the amount invoiced.

100%. For those without insurance yet another potential calamity waiting in the wings as retirees age. The more we examine the implications of this impending change there are fewer and fewer reason for expats to consider Thailand as a favorable twilight years retirement destination.  I'm sure there are many more that we haven't even considered yet. I know the right way to view all this presently is to wait and see as it may all change again, but I'm not feeling very confident that will be very likely in this instance. Hope isn't a strategy I consider a sound way to base your future plans on. After saying that my last hope from a personal perspective is that Thai Elite visa holders will secure an exemption, however unlikely that may be. If not I think it is safe to say Thai Elite will be also facing their very own Titanic moment. 

 

Putting selfish considerations aside, I really do share the concerns for all retirees with property, wives and children and roots firmly dug in to the 'OLD' Thailand. Easy to say just leave when you are younger with more energy, freedom and still have earning potential. Sadly as usual if this comes to pass it's the most vulnerable who end up paying the biggest price. 

 

Anecdotal story to finish. Was only talking to a Singaporean / Dutch couple early last month while I was in a barbers getting my hair cut. Conversation came around to them asking me what were the best options for retiring to Thailand as they were loving it here. Naturally I recommended that the Thai Elite program was something that they could consider if money wasn't a big issue for them. They handed me their phone and I directed them to the official Elite site. [This was also pre price increases announcement] Conclusion to this story is that it would be a very different conversation today than the one we shared several weeks ago. 

Edited October 5, 2023 by Conno

[jerrymahoney]

14 hours ago, Lorry said:

BTW sometimes a DTA doesn't use the tax credit method but says that certain types of income are just not taxable in Thailand.  It remains to be seen whether the RD will follow these rules.

https://www.rd.go.th/english/23520.html

[quake]

6 hours ago, Conno said:

Putting selfish considerations aside, I really do share the concerns for all retirees with property, wives and children and roots firmly dug in to the 'OLD' Thailand. Easy to say just leave when you are younger with more energy, freedom and still have earning potential. Sadly as usual if this comes to pass it's the most vulnerable who end up paying the biggest price. 

 

So very true. 

[Mike Teavee]

13 hours ago, Lorry said:

PS reading the Q&A again,  there is a hitch:

They say many times, that they are only taxing income from years in which you have been tax resident in Thailand (e.g. rental income from renting out your London flat in 2020, when you stayed 200 days in Thailand)

This income will  be taxable when you bring it into Thailand,  no matter in which year. 

Nowhere do they explicitly state that you also have to be a tax resident in the year the money is brought into Thailand. If that's not necessary, the consequences would be enormous. You could owe taxes for sending old income from 2020 (or 1999) into Thailand even if in the year of sending you are not in Thailand at all. The loophole would be closed,  but if you ever have stayed in Thailand more than 180 days, you better never send money into Thailand ever after.

Another reason why taxing on remittance doesn't work & why most countries that tax foreign income, tax you on it whether you bring it into the country or not (Not that I want Thailand to do this as it would mean even more Tax to pay for me, but that is the only way I can see this working).  

 

 

[jacko45k]

On 10/4/2023 at 8:18 PM, Yumthai said:

These people, if they wish so and because they can afford, can simply apply for a LTR visa and be tax exempted on their foreign money remittance.

 

Do you believe that to be the case and 'solid'? The T&Cs for LTR Visas were devised and implemented well before this new tax regulation wrt foreigners was devised... and we still have to learn exactly how it will be implemented. One might believe that those living here on LTRs were exactly the type being targeted. 

[sometime]

So anyone buying a condo in Thailand the future will the tranfer of millions to your Thai bank account be taxed?

If so I can see the property market going down (but seeing that the PM is in the propery game !)

[redwood1]

41 minutes ago, jacko45k said:

Do you believe that to be the case and 'solid'? The T&Cs for LTR Visas were devised and implemented well before this new tax regulation wrt foreigners was devised... and we still have to learn exactly how it will be implemented. One might believe that those living here on LTRs were exactly the type being targeted. 

Yea they got all the rich LTR sheep on record now.....So they will be checking the LTR people out extra close.....lol

 

No I am joking I dont want to see anyone get stung by this tax nightmare..

Edited October 6, 2023 by redwood1

[Karma80]

My strategy will be to avoid bringing the money into the country from overseas. I have the latitude of a salary taxed in Thailand already, but the bulk of my other income will stay offshore. My rough numbers are that I won't have an additional tax liability in Thailand if I choose to remit it, as the funds are mostly already taxed elsewhere.

 

But there is no way I am throwing myself in the firing line of Thai RD, and jumping through hoops over the first few years of "misunderstandings" and whatever, or risking moving to LTR until that has gone through the wash in the new paradigm. Someone else can be the crash test dummy.

 

I'm sure there will be legal challenges in the tax court and all sorts of other shenanigans to play out yet. Until then, Thailand looses my income and investment. They won't lose any sleep over it, I am smaller than small fish. But I still can't fathom why to introduce this massive uncertainty for the next couple of years.. As a couple of well off Thai friends said, it's OK, we just won't bring the money here or use other ways.

[andux]

31 minutes ago, Karma80 said:

As a couple of well off Thai friends said, it's OK, we just won't bring the money here or use other ways.

That probably won't last too long though.

 

It wouldn't surprise me if in a few years Thailand just starts taxing all foreign income, adds wealth taxes, etc. especially when they realize that it's easier to do than this remittance-based system.

[beammeup]

1 minute ago, andux said:

That probably won't last too long though.

 

It wouldn't surprise me if in a few years Thailand just starts taxing all foreign income, adds wealth taxes, etc. especially when they realize that it's easier to do than this remittance-based system.

Will be very good for Singapore condo market.

[K2938]

Thailand planning to monitor foreign credit card transactions for circumvention of foreign remittance tax according to AmCham presentation
 

 

[redwood1]

18 minutes ago, K2938 said:

Thailand planning to monitor foreign credit card transactions for circumvention of foreign remittance tax according to AmCham presentation
 

 

A post from this thread.....Not me....

 

 

A foreigner named NokKavow comes here and spends $5,000 on his Mastercard. Assuming Mastercard or the local business discloses these records to the Thai government. How do they know this foreigner is you?

 

We can assume that Mastercard will not disclose this info - the privacy of their customers is, in fact, more important to them than the <deleted>ty little nation of Thailand. Their transaction volume is many many times the size of the entire Thai economy.

 

If the US or EU comes knocking sure they need to play ball. But Thailand is never going to kick out the global card processors - their economy would grind to a halt overnight if every Visa or Mastercard stopped working, and those companies would barely notice.

 

So the Department of Revenue has to obtain a record of every foreign credit card transaction from every business in Thailand, and then somehow determine with the limited information associated with those transactions whether those people are Thai tax residents. Yeah right.

 

 

This conversation has gone off the deep end, it's so far from reality at this point

 

 

Edited October 6, 2023 by redwood1

[jerrymahoney]

This is currently on the AMCHAM website:

[vukovar77]

21 hours ago, redwood1 said:

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

The Revenue Department Order No. P. 161/2023 is not a law.

It does not matter.For RD Order is mandatory.

Something else is very indicative,like SET index plunge in a last week or so,THB depreciate significantly ,foreigns sell offs on Thai stock market,sell off construction companies etc.

Edited October 6, 2023 by vukovar77

[JimGant]

2 hours ago, redwood1 said:

Thailand planning to monitor foreign credit card transactions for circumvention of foreign remittance tax (quote from AMCHAM)

Foreign remittance tax?! What happened to tax on assessable income that gets remitted? I fear things have gotten way over analyzed, as Thailand is certainly not going to tax all monies coming into the country, to include Foreign Direct Investments, which are largely capital (not income) raised in foreign financial institutions.

 

So, credit card purchases aren't income, but a loan from your bank to pay BigC. And remitted loans ain't income; so assuming we're still addressing assessable income remitted to Thailand, forget credit card payments somehow being scrutinized.

 

A debit card transaction, which is a direct payment made by you, and not a loan, maybe could be scrutinized, as in my case, it would come out of the same pile of money in my bank account that I use to send a wire transfer. Then, discerning which of these monies is deposited income, and which are after tax savings -- is the largely unsolvable problem that makes focusing strictly on remittances ludicrous. And if Thailand wants to use FATCA and CRS reporting data, especially when it further matures in a few years, they'll only be able to identify income, not remittances. So, it they stick with this remittance BS, they're chasing their tail, and costing themselves gettable taxable income. [I went through the 66 page US-Thailand FATCA agreement -- and nothing there involving remittance reporting.]

[homeseeker]

2 hours ago, jerrymahoney said:

This is currently on the AMCHAM website:

So this means that "Pension/retirement income(see TaxTreatises)" will continue to be treated in the same way  as before for those on retirement visas.....right(?)

[TroubleandGrumpy]

On 10/4/2023 at 6:39 PM, stat said:

Thanks for this info! No way I could file a potential thai tax declaration by end of march as I get my annual tax statements from the banks between April and September.

Exactly - and the same for me - in Aust the annual taxation and reporting period is July 1 to 30 June.

None of the financial or superannuation companies provide annual reports Jan to Dec.

That are so many other complications that IMO this whole move is about as well thought out as a BLM protest in LA (or a riot in Belfast). 

 

It is not a matter of compliace, IMO it is a matter of avoiding all the potential hairs this thing has on it. Good luck convincing Somchai in the local RD Office, that the 5 million baht you brought into Thailand last year (Car, House, Tractor, 800K Deposit etc etc) was not income. Sure it technically was savings from past earnings that were previously taxed and from a pension, but proving that to Somchai who wants that 1.5 million in Tax so he will get a bonus/promotion, is not going to be an easy thing to do - especially when he does not speak English and any 'appeal or complaint' has to be lodged in Thai.  IMO the wise thing to do is to keep low and not bring too much money into Thailand over the next few years, and wait and see what happens. I pity the first Expat caught in this new net - but I hope it is him and not me.