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

[hotandsticky]

3 minutes ago, TroubleandGrumpy said:

So how many Expats do you think are in Thailand and receive either a partial pension or a full pension?

If you are right then it means they we will all have to lodge a tax return and claim that under the DTA our pensions are not taxable in Thailand.

And what do you recommend we do if the Thai RD decides that I/we are wrong, and/or that the 'evidence' we provided is insufficient, and they decide that I/we must pay income tax?

Have you examined the appeals process against a Thai RD decision? I have (planning for worst case) - and it is horrendously difficult - besides being only acceptable in Thai (with multiple and certified translations), it would cost a lot of money hiring an acceptable Thai lawyer/.accountant to compile and lodge that appeal, and from what I could find, they are extremely reluctant to agree that they were wrong. 

Plus - what about if the money I bring into Thailand is from multiple sources - how do I or anyone prove that x amount is pension, y amount is savings, z amount is superannuation, etc.  If you still cannot see how complicated and difficult this would be for most Expats, then we have nothing to talk about.  

 

You do seem to be unnecessarily devoting an inordinate amount of time to this subject.

[TroubleandGrumpy]

35 minutes ago, Mike Lister said:

I transferred in over 8 million, 15 years ago, nobody said anything, a million a year is nothing by comparison. An American chum purchased three condo's about 12 years ago and transferred large sums in the space of a week. His Thai wife got a call from BOT and asked her what they were doing and she explained they were buying condo's for investment.....oh, OK then, end of. That was 25 million in three transfers.

Good for you mate.  Now do that in 2024, and let me know how that all goes. 

You remind me of my niece - she refused to wear a helmet on her bike to school - bla bla bla why farang worry - she was just like you. She had an accident one day - in hospital - head injury - all good after a day just headaches for a week or so (no skull fracture - just a lot of blood).  I bought her a 'real' helmet and she now wears it every time. 

Good Luck mate.

[atpeace]

1 hour ago, TroubleandGrumpy said:

Great points mate.  How they do that is that your tax returns are checked - so you have to tell them - it is a voluntary system.  But if you dont tell them and they later find out - that itself is a big risk.  However, the money you remitted into Thailand you will have to declare that it is savings or whatever, and not income. They can then, if they want to, require you to prove that - they probably wont unless it is a large amount - but who knows how they will manage this change.

Ok, purchase most things now with my debit card on Lazada, Big C hotels, etc.  Switch to my USA debit card and that eliminates 80% of transfers?  Send any other money to my GF and spend that. So many loop wholes that I fail to think this will ever come to fruition.  Stranger things have happened to me but have my serious doubts this will amount to anything.  I just thought of another easy workaround while typing but don't feel like sharing ????

 

I would be furious if Lazada shared that I purchased my g-string underpants with a foreign credit card to the the tax man.

Edited October 9, 2023 by atpeace

[TroubleandGrumpy]

34 minutes ago, Sheryl said:

Not true for some types of pensions under some DTAs. True for others.

Yes Sheryl that is the case - but exactly which ones are and are not taxable is the issue. Also, when/if you lodge a tax return and say that the DTA means they are exempt, what will the Thai RD need in order to accept that claim - and then what happens if they do not and/or want more proof.  I am not really keen to pay income taxes for nothing, but I am also not keen to pay an accountant/lawyer every year to do tax returns.  I retired and I dont want to have to go through all that trouble and worry.  Easy fix - the Thai RD provides a blanket exemption to long term Expat's pensions and savings brouight into Thailand.  The current 'situation' seems to be that all money brought into Thailand could be viewed as taxable income, and therefore each Expat will have to lodge a tax return and claim that it is not taxable - wioth no explanation how to do that or what documents are required and in what form and what is acceptable. 

Thai Immigration provides the exact details of what documents and information (and money) must be provided for an annual extension 'request' - and yet there is often something new, or changed from last year, or there is a different interpretation by some IO in a bad mood. 

Hopefully all those details and exemptions and clarifications will be provided before this comes into effect on January 1 2024.  This exercise has been very useful on this forum - learning from others and knowing a bit about what needs to be clarified or exempted is a good thing.

[Mavideol]

maybe I am repeating myself or somebody else's post, however still confused about their purpose of taxing us, westerners, do understand their main goal is the $$$$$$$, if so the easy/fast way would be for them to go after all the doctors with side site clinics and other business receiving undeclared cash, why ?  why us, what have we done to deserve it

[retiree]

1 hour ago, Sheryl said:

But if no tax due, no return required, yes?

This question has been asked a number of times.  I don't think the RD ever says "if you don't owe tax you don't have to file a return".    It does say: 

 -- If the person is not a tax resident no return is due (unless the person earned more than 120,000 baht in Thailand)

 -- If the person is a tax resident and has not transferred or earned assessable income no return is due.

 -- If the person is a tax resident and is below the income limit for filing (120,000 baht) no return is due. 

 

Some points don't seem to be addressed explicitly simply because it's not clear when the word "income" (as used in passing in the RD explanations of the forms, rather than in the law) refers to: 

 -- monies before or after DTA exclusions,

 -- monies before or after DTA credits,

 -- monies before or after ordinary Thai tax deductions and exemptions.

That said, there probably is clear precedent known to any Thai tax accountant, which I am not.  

 

Still, I'd imagine that:

 -- it is barely conceivable that if you don't owe tax because income was excluded (as in the US DTA re Social Security) there may be some small fine for late paperwork (which in practice might never be levied).

 -- it is likely that if do owe tax because you miscalculated your tax credit or exemption, there will be a fine and penalty if you don't file.

 -- it is possible that if you don't owe tax because you have Thai deductions and exemptions, or because you are claiming DTA credits, you still must file even if the tax bill is zero, so that the RD can check your arithmetic. 

 

Again, these are questions that can be framed simply (without getting into the weeds of your personal tax situation) to any Thai tax accountant, also which again I am not. 

 

These comments just reflect my reading of the docs.  I would be happy to post any needed corrections, or to read a post from somebody quoting his or her Thai tax accountant.  

Edited October 9, 2023 by retiree

[TroubleandGrumpy]

4 minutes ago, atpeace said:

Ok, purchase most things now with my debit card on Lazada, Big C hotels, etc.  Switch to my USA debit card and that eliminates 80% of transfers?  Send any other money to my GF and spend that. So many loop wholes that I fail to think this will ever come to fruition.  Stranger things have happened to me but have my serious doubts this will amount to anything.  I just thought of another easy workaround while typing but don't feel like sharing ????

Yes - that is the way to deal with this matter IMO - do workarounds.   The key to working around a problem, is to know exactly what the problem/s are and how they will be 'managed'. Once you knwo that then avoiding the problem is a lot easier.

Certainly I will be bringing into Thailand before Dec 31 a lot more money than I had planned - because I will not be a tax resident of Thailand in 2023 (just).  I was a tax resident for almost 5 years before - but that period is well before this change. 

I know one guy that is talking of buying a property next year, and is going to be trabsferring over to Thailand this year and in 2024 a heap of money - but he will only be staying in the country for about 170 days next year.  Then in 2025 he will be returning full-time - wish I could easily do that - but he has me thinking.  

[TroubleandGrumpy]

5 minutes ago, Mavideol said:

maybe I am repeating myself or somebody else's post, however still confused about their purpose of taxing us, westerners, do understand their main goal is the $$$$$$$, if so the easy/fast way would be for them to go after all the doctors with side site clinics and other business receiving undeclared cash, why ?  why us, what have we done to deserve it

We are not the 'targets' - they are after the 'big fish' and we are just 'small fry'.  But here is the thing with the taxation 'nets' that they throw out (worldwide) - they 'catch' some small fry in those nets - they dont mean to but they do.  Now will Somchai at the local RD Office decide - no worries I let that one go - or will he decide to check further.  Remember too - a lot of small fry makes a decent meal.  The big fish are very good at avoiding the net. Hopefully they will be 'nice' and clarifiy this matter and give us exemptions - time will tell.

[atpeace]

2 minutes ago, TroubleandGrumpy said:

Yes - that is the way to deal with this matter IMO - do workarounds.   The key to working around a problem, is to know exactly what the problem/s are and how they will be 'managed'. Once you knwo that then avoiding the problem is a lot easier.

Certainly I will be bringing into Thailand before Dec 31 a lot more money than I had planned - because I will not be a tax resident of Thailand in 2023 (just).  I was a tax resident for almost 5 years before - but that period is well before this change. 

I know one guy that is talking of buying a property next year, and is going to be trabsferring over to Thailand this year and in 2024 a heap of money - but he will only be staying in the country for about 170 days next year.  Then in 2025 he will be returning full-time - wish I could easily do that - but he has me thinking.  

I guess all this is worth some thought but on other hand it completely futile,  Some seem to feel they know a lot and myself may have come off as knowing too much.  In the end, nobody on this thread really has a grasp o of what will be taxed and how it will be taxed.  The taxing of foreign remittances seems flawed on so many levels that in a sane world it would never come to fruition.  Preparing for anything is pointless because we don't know what to prepare.

[TroubleandGrumpy]

2 minutes ago, atpeace said:

I guess all this is worth some thought but on other hand it completely futile,  Some seem to feel they know a lot and myself may have come off as knowing too much.  In the end, nobody on this thread really has a grasp o of what will be taxed and how it will be taxed.  The taxing of foreign remittances seems flawed on so many levels that in a sane world it would never come to fruition.  Preparing for anything is pointless because we don't know what to prepare.

Could not have said it any better. But as they say - This Is Thailand - who really knows what they will do.

All anyone can do is plan for what they will do in any given situation.

 

[MeePeeMai]

10 minutes ago, TroubleandGrumpy said:

I know one guy that is talking of buying a property next year, and is going to be trabsferring over to Thailand this year and in 2024 a heap of money - but he will only be staying in the country for about 170 days next year.  Then in 2025 he will be returning full-time - wish I could easily do that - but he has me thinking.  

If too many folks dodge the 180 day rule by leaving for 6+ months a year (to avoid being a tax resident), then I would eventually expect to see a new rule (or law) that forces those with an O or O-A type long stay visa to spend at least 180 days in Thailand per calendar year or lose your current status/extension.

 

Malaysia has a rule that those with an MM2H retirement visa must spend at least 90 days per year in Malaysia to be eligible (so don't say that it couldn't happen in Thailand).

 

I hope all this worrying is for naught but I am also one who likes to have a back-up plan or two in case things go sour (this is the main reason I have not cut all ties with my motherland) and I am always running scenarios in my mind to be prepared and ready if a push comes to a shove.

[Lorry]

2 hours ago, Sheryl said:

anyone know if the Thai tax code requires people who owe no tax to still file a return?

No, you don't. 

Like retiree said ( @retiree it is 120000, not 150000, right?)

If your taxable income is lower than this,  you don't have to file. 

 

But a provincial RD might apply a DTA in very creative ways - resulting in a tax liability where you didn't see one. 

They also might want you to file a return ",to check your arithmetics" as retiree said. 

Edited October 9, 2023 by Lorry

[TroubleandGrumpy]

4 minutes ago, MeePeeMai said:

If too many folks dodge the 180 day rule by leaving for 6+ months a year (to avoid being a tax resident), then I would eventually expect to see a new rule (or law) that forces those with an O or O-A type long stay visa to spend at least 180 days in Thailand per calendar year or lose your current status/extension.

Malaysia has a rule that those with an MM2H retirement visa must spend at least 90 days per year in Malaysia to be eligible (so don't say that it couldn't happen in Thailand).

I hope all this worrying is for naught but I am also one who likes to have a back-up plan or two in case things go sour (this is the main reason I have not cut all ties with my motherland) and I am always running scenarios in my mind to be prepared and ready if a push comes to a shove.

I agree 100%.  Especially wqhen you say dont cut the ties to home country - having a Plan B is essential for any Expats living in Thailand - things can change very quickly and there is very little Expats can do about it - except complain and make a lot of noise ???? 

 

[Lorry]

1 hour ago, retiree said:

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.   https://www.rd.go.th/english/6045.html

Thx.

(This answers my question on p71 - i had overlooked this)

[Dogmatix]

2 hours ago, Sheryl said:

The change will go ahead, that is not in doubt.

 

Whether expat retirees will be made to file returns even when they have no assessable income (and if so, how strictly that will be enforced) remains to be seen.

 

I would hope that if that does happen,  there will be accountants or agents versed in DTAs etc able to do the paperwork for us and provide any needed certificates. From my past dealings with my provincial RD (who among other things believe there is no such thing as retirement visa or extension, all farangs must be working here, and other nonsense) trying to file on my own would be a disaster even though all my remittances to Thailand are very clearly non-assessable under the DTA.

 

As a matter of curiosity, does anyone know if the Thai tax code requires people who owe no tax to still file a return? Certainly most Thais in that situation seem not to do this. Neither do migrant workers, and even though here on explicit work visas there is no requirement for them to show tax clearance documents to extend.

 

 

I called the RD some years ago when I stopped working for a while to ask this question and the answer was that there was no requirement to file a tax return with income below the threshold but I can't tell you that is in the Revenue Code. It may an RD Order. Anyway, as you say, most Thais and migrant workers don't file tax returns and the RD doesn't chase them up. In my case I stopped filing for a few years, then resumed filing with no comment from the RD.

[Dogmatix]

7 hours ago, jerrymahoney said:

He was also referring to non-state pensions. 

Non-state pensions are not exempt in any of the DTAs I have looked at.

[atpeace]

2 hours ago, Sheryl said:

I don't see how they can. I would expect instead (in the case of people on retirement extensions/visa) some sort of attestation you can make that the source of funds was savings from income earned before becoming a Thai resident.

 

IF retirees are required to submit documentation at all. Between the fact that some types of retirement income are non-Assessable under DTAs, savings from income earned before becoming a Thai resident are also non-assessable,  and that tax credits have to be provided for any tax paid in the home country, the potential gain in revenue would be quite small and the whole thing a huge hassle.

 

It is worth noting that under the old rules, overseas pensions directly remitted to Thailand (except were exempted under a DTA) were always taxable yet as far as I know, no effort was ever made to enforce that.

The only way I see this working and even then it would be a mess, is if they require certified tax returns from an embassy.  A tax return can be submitted online in minutes that has nothing to do with reality but I guess the certification might stop a few,.  The USA embassy would probably endorse it as long long as you promised it was accurate.   Like they did with the 65k income letter.  The Thai government has no means of determining the source of  income which they need to assess it.  This is insane but kinda funny.  

[Neeranam]

1 hour ago, atpeace said:

Ok, purchase most things now with my debit card on Lazada, Big C hotels, etc.  Switch to my USA debit card and that eliminates 80% of transfers?  Send any other money to my GF and spend that. So many loop wholes that I fail to think this will ever come to fruition.  Stranger things have happened to me but have my serious doubts this will amount to anything.  I just thought of another easy workaround while typing but don't feel like sharing ????

 

I would be furious if Lazada shared that I purchased my g-string underpants with a foreign credit card to the the tax man.

I use my Crypto.com debit card for almost everything. 

Can top up with Bitcoin.

 

 

Edited October 9, 2023 by Neeranam

[Dogmatix]

It seems that anyone surviving in Thailand on a full frozen UK state pension without other income would just squeeze into the Thai tax net.  Taking basic deduction of 60k plus 190k over 65 deduction would put them about 85k over the 150k threshold and that would be in the lowest progressive rate of 5% resulting in about 4k tax which would be payable in Thailand without tax credit, as it would be below the threshold in the UK.  Any private pension or other UK income puts you into higher Thai tax rates but as UK tax kicks in over the UK threshold, the Thai tax take net of tax credit is still going to be quite low.  However, the low Thai tax threshold means that every single UK pensioner who has at least the full frozen pension or equivalent from other sources is liable to Thai tax and will have to file a tax return and pay, in most cases, a small amount of Thai tax after tax credit.

 

If 80k British pensions pay just 4k Thai tax, they will 320 million baht which they will be happy to have.  But will it worth the hassle of forcing them to calculate their tax liability, which cases of other income will be quite complicated, and file tax returns? I doubt it, once you net off economic losses from retirees who leave, switch to spending less than 180 days in the Kingdom and decide not to bring in any case for a condo, car or to start a business to avoid being taxed at 35%. Definitely a huge amount of greed without much thought put into it.

 

 

[Neeranam]

2 minutes ago, Dogmatix said:

It seems that anyone surviving in Thailand on a full frozen UK state pension without other income would just squeeze into the Thai tax net. 

So it not taxed in the UK? 

[K2938]

1 hour ago, beammeup said:

So capital transfers for cars, condo's etc will not likely be taxed as income?

Why would that be?  As of now based on all what has been announced there would be absolutely no exemption for this.  So if it is a taxable remittance, than it is taxed regardless of what you do with the money.  And if not, then not.  But just buying a car or condo does not change this.

[retiree]

21 minutes ago, Lorry said:

Like retiree said ( @retiree it is 120000, not 150000, right?)

If your taxable income is lower than this,  you don't have to file.

Various guides are found here, note the year-by-year tabs:

https://www.rd.go.th/english/63902.html

Legal Affairs Division, The Revenue Department, Bangkok Thailand

 

This is the guide to:  Personal Income Tax Return for taxpayer with income not only from employment (Tax Year 2022)

https://www.rd.go.th/fileadmin/download/english_form/2022/220366PIT90.pdf

 

In that, the minimum is only 60,000 baht.   The 120/220K limit is for employment only, viz:

Guide to Personal Income Tax Return 2022

You have to file a return on the income that you received if you meet one of the following conditions:

(1)           Your total income exceeded 120,000 baht in the tax year.

(2)           You were married and your income combined with that of your spouse exceeded 220,000 baht in the tax year.

 

Note that in either case the minimum amount required for taxation is more than the amount required for filing.  Again, though:

 -- their use of "total income" in this particular context may mean what we'd think of as net taxable income, 

 -- there might not be a penalty assessed for late filing if no tax is due.

Ask an accountant, which I am not now, and have never been.

 

[Neeranam]

18 hours ago, SHA 2 BKK said:

2.   I’ve got one of the LTR Pensioner Visas.   I asked about these changes.  Posted this earlier but this was the response from the BOI LTR Team.  They are pretty adamant there won’t be any change for this type of Visa.  Though they don’t mention Pensions in particular which as you point out could be seen as passive income.  Personally I get mine paid in Australia and bring it in only when needed - in the following tax year.  It’s taxed in Australia and I would consider it savings after that.  

Hi, could you explain why you take you pension, that is taxed already, the year after?

[K2938]

1 hour ago, TroubleandGrumpy said:

If you are right then it means they we will all have to lodge a tax return and claim that under the DTA our pensions are not taxable in Thailand.

And what do you recommend we do if the Thai RD decides that I/we are wrong, and/or that the 'evidence' we provided is insufficient, and they decide that I/we must pay income tax?

Have you examined the appeals process against a Thai RD decision? I have (planning for worst case) - and it is horrendously difficult - besides being only acceptable in Thai (with multiple and certified translations), it would cost a lot of money hiring an accepotable Thai lawtyer/.accountant to compile and lodge that appeal, and from what I could find, they are extremely reluctant to agree that they were wrong. 

It gets even worse than this.  While the Thai tax authorities have not really much focused on remittances from foreigners in the past, they of course will do now.  And in the course of complaining about your transfers in 2024, they will then probably also ask you a lot of questions about transfers you made in the past and also start complaining about those because maybe they were not really tax-free according to their logic even under the old tax regime.  And they can demand back taxes from you for up to 10 years.  So this will be real fun.

Edited October 9, 2023 by K2938

[Neeranam]

17 minutes ago, atpeace said:

Interesting.  Tell me more.  Do I need to invest into crypto?  Stupid question but I'm asking in all seriousness.  If so, how much?  Are there any other hidden cost to use it?  Thanks'

Check it out here.  One thing, I couldn't get it sent to a Thai address, so I used my mum's in Scotland.

I've had it for about 5 years and had to invest about $500 to get the card with 3% cashback(in crypto but can exchange immediately). I believe that has risen quite a bit. Yes, look at the attachement. 

 

However, you can get a card without buying(staking) any crypo, but obviously without the cashback.

It as worth staking as I got good rewards and the price of their token rose considerably. Also got free Netflix, Spotify, and free First class lounges at airports. 

 

 

tps://www.forbes.com/advisor/credit-cards/reviews/crypto-com-rewards-visa/

 

https://crypto.com/cards

Edited October 9, 2023 by Neeranam

[SHA 2 BKK]

6 minutes ago, Neeranam said:

Hi, could you explain why you take you pension, that is taxed already, the year after?

Because the LTR Pensioner Visa allows me to bring in income earned in the previous year tax free (as per currently everyone else - but this will change 1 January 2024 for non LTR Visa holders - thus this long thread).
 

I figure I don’t and won’t have to lodge a Thai tax return if I continue with this method. I have asked BOI for their clarification and they have advised this will continue to be the case and the RD will make an announcement re. Though I am not holding my breath waiting!  
 

Some on here predict that this tax exemption will end for LTR Visa holders.    If so I have enough savings from previous years to remit and not lodge a tax return as I gather savings are exempt.  
 

Time as always will tell. 

[atpeace]

2 minutes ago, Neeranam said:

Check it out here. 

I've had it for about 5 years and had to invest about $500 to get the card with 3% cashback(in crypto but can exchange immediately). I believe that has risen quite a bit. Yes, look at the attachement. 

 

However, you can get a card without buying(staking) any crypo, but obviously without the cashback.

It as worth staking as I got good rewards and the price of their token rose considerably. Also got free Netflix, Spotify, and free First class lounges at airports. 

 

 

tps://www.forbes.com/advisor/credit-cards/reviews/crypto-com-rewards-visa/

 

https://crypto.com/cards

Thanks! I only put my money where I can at least convince my self I understand the investment. In this case, I don't have to invest so why not.  I think a Wise debit card would also work. My debit cards in the USA are attached to accounts with substantial balances so i have a few reservations about using them on Lazada. 

 

With Wise or possibly a Crypto debit card I could drop a couple grand into the account and not worry.

 

Thanks

[BE88]

5 hours ago, Mike Lister said:

Only the funds that are remitted to Thailand are liable to Thai tax, at the time they are remitted.

Wrong, if you are resident in Thailand all your income is taxable unless you can demonstrate that your income has already been taxed in another country that has an agreement with Thailand

[Neeranam]

2 minutes ago, atpeace said:

Thanks! I only put my money where I can at least convince my self I understand the investment. In this case, I don't have to invest so why not.  I think a Wise debit card would also work. My debit cards in the USA are attached to accounts with substantial balances so i have a few reservations about using them on Lazada. 

 

With Wise or possibly a Crypto debit card I could drop a couple grand into the account and not worry.

 

Thanks

Can I get a Wise card sent here to Thailand? My Wise account is in Euro.

[noobexpat]

2 minutes ago, BE88 said:

unless you can demonstrate that your income has already been taxed in another country that has an agreement with Thailand

Well that bit is nonsense i'm afraid.