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

[Longwood50]

5 minutes ago, Mike Lister said:

Thailand's tax system has always been supported by the wealthy and by corporates,

With respect to my comments it was not about fairness, it is about financial reality.  You want people with money coming to your country and investing.  Anything you do to discourage that has negatives.  

Like it or not, those big homes are purchased in large part by expatriates.  However it is the Thai worker who builds them.  You discourage the expatriate from settling in Thailand or residing here full time, the home doesn't get built and the Thai worker is unemployed. 

That expatriate that comes to Thailand spends money here and all of that is taxed at the 7% VAT.  They stay outside of Thailand for 180 days or don't come at all and all those new taxes you thought you were getting suddenly are diminished or don't happen at all. 

The real questions is what is good for your economy.  I am a proponent of you want your country to be the most attractive for elements you want inside your borders and the least attractive for elements you don't want.  Taxing expatriates is a negative and people will take action to avoid them.  The policy is truly a statement that expatriates are not welcome in Thailand 

 

As to your comment about he tax system in Thailand being targeted with the wealthy paying. Everyones tax system is supported by the wealthy.  Though much maligned the top 1% of tax payers in the USA pay more income tax than the bottom 90% combined. Poor people don't have money and hence you can not get money from someone who does not have it. 

[Mike Lister]

1 minute ago, TroubleandGrumpy said:

And that is exactly why it is probably so 'dangerous' for Expats - if they do it - because they will screw it all up. They will attempt to get that additinal money, and they will completely stuff it up, and some Expats will get caught in the net, and they will not be able to 'get out' - or at the very least they will have a lot of trouble and expenses and risk jail and deportation. Almost 50% of the Thai economy is 'black' - and they are desperate for money - they are very likely to screw it all up. 

 

Malaysia is far more 'organised' and when they implemented this same rule change back in 2021, then delayed implementation for personal income taxes for 5 years (2026), while they work out all the details and exemptions.  Will Thailand clarify details before 2024, or delay implementation - I dont know. 

 

But if it goes ahead as is and with no more details and exemptions, then I can assure you that the Thai RD in 2025 will be seeking details from all banks about any account or person that transferred over XYZ Baht into the country in 2024.  If they see anyone's account and no tax return, they will not hesitate to start asking questions - including for Expats. They will probably create a whole new team of Thai RD 'investigators' to check incoming remittances against tax returns - and just like the BS fed from TAT - they will justify their additional expenses by nailing as many people as they can - including Expats.

 

My plan is to bring forward incoming remittances to this year, and then bring in the absolute minimum in 2024. If they declare that Expats must all do a tax return - then I will submit one claiming all the exemptions etc. If they say I must pay income taxes on the money brought in for 2024 - then I will pay, and then we will leave.

In your first two sentences you made eight assumptions that can't be substantiated, it's dangerous,  they'll screw it up, they'll attempt to get additional money, they' ll stuff it up, expats will get caught in the net, they wont be able to get out, they risk jail, deportation and lots of expense. Later in your post you make even more!

 

Face it, you don't like Thailand and will find any unsubstantiated excuse to put it down and frighten off expats.

 

Earlier you talked about not wanting to pay tax here but if you live here, or anywhere else, you have an obligation to do so. Do you not see that. 

[Mike Lister]

Just now, Longwood50 said:

With respect to my comments it was not about fairness, it is about financial reality.  You want people with money coming to your country and investing.  Anything you do to discourage that has negatives.  

Like it or not, those big homes are purchased in large part by expatriates.  However it is the Thai worker who builds them.  You discourage the expatriate from settling in Thailand or residing here full time, the home doesn't get built and the Thai worker is unemployed. 

That expatriate that comes to Thailand spends money here and all of that is taxed at the 7% VAT.  They stay outside of Thailand for 180 days or don't come at all and all those new taxes you thought you were getting suddenly are diminished or don't happen at all. 

The real questions is what is good for your economy.  I am a proponent of you want your country to be the most attractive for elements you want inside your borders and the least attractive for elements you don't want.  Taxing expatriates is a negative and people will take action to avoid them.  The policy is truly a statement that expatriates are not welcome in Thailand 

 

As to your comment about he tax system in Thailand being targeted with the wealthy paying. Everyones tax system is supported by the wealthy.  Though much maligned the top 1% of tax payers in the USA pay more income tax than the bottom 90% combined. Poor people don't have money and hence you can not get money from someone who does not have it. 

Which is why I wrote that.

[Mike Teavee]

3 hours ago, Mike Lister said:

Nobody other than the doom mongers have suggested that would happen, I think there is zero percent chance that it would.

Obviously some guys who are living to their income will spend less money in-country as they won't have the same amount of (after tax) money to spend. 

 

But even guys who have some headroom in their budget might spend less, in my case I'll simply switch from holidaying In Thailand to holidaying elsewhere & pay for these using my UK Credit & Debit cards.    

 

Obviously my fixed costs (Rent, Mobile & Netflix etc...) stay the same but the net result would be less money coming into Thailand (= less Tax 😉) & less money spent on hotels, in-country travel, restaurants, bars etc.. even groceries in Thailand.  

 

OK, so not everybody likes/wants to travel, but I'll go at any excuse so if I get it into my head that anything I spend overseas is being 35% funded by the Thai Tax man then I'm just going to travel overseas even more 🙂   

 

 

 

 

[The Cyclist]

53 minutes ago, TroubleandGrumpy said:

and if any Expat thinks it will absolutely 'not apply to me', then they are very mistaken twice.

I do not think that there is many who are declaring ' This will not apply to me '

 

The issue at the moment is that we do not know ' what will apply to whom '

 

As has been pointed out repeatedly. DTA's will apply, and what is covered is covered is dependant on the Your Country / Thailand DTA.

 

Thailand has 61 DTA's with other Countries. Which will encompass a barrowload of work for the RD when they have to go through those DTA's for every single expat covered by a DTA.

 

So it would come as no surprise to hear a blanket statement being issued stating that X, Y and Z incomes ( probably pensions / social security etc ) are exempt for people from those Countries are exempt.

 

1 hour ago, TroubleandGrumpy said:

Only if and when the Thai RD issues clarifications and exemptions that specifically state that money brought into Thailand by long-stay Expats is not taxable income (given certain conditions)

As I said yesterday. It would be prudent to abide by your Country / Thailand DTA and limit your exposure before 01 Jan 2024 to potentially being skelped with Thai taxation.

 

You do not require a further announcement from the RD to put this into practice.

 

Common sense tells you to continue remitting to Thailand income / money covered by a DTA and stop remitting income / money to Thailand that is not covered by a DTA.

 

Absolutely no point in typing a 3000 word dissertation above about what you are going to do if Thailand does X. Take proactive steps to reduce the risk of X.

[TroubleandGrumpy]

13 hours ago, Dogmatix said:

I am not sure it matters whether the recipient Thai bank labels an inbound remittance as income or something else. That is an internal matter for the bank. The RD expects tax residents to declare income by themselves. They may get details of remittances from banks but I think the bank description of income probably just means inflow.  If it is over 50 USD or used to be that much, the bank has to ask you for the purpose, but not the source, and report to the BoT (not the RD).  The choices for foreigners are I think living expenses, purchase of condo etc.  I was told by the bank officer that loan was not acceptable for foreigners but OK for Thais. If under that amount, it seems to just slide straight into your bank acount with no questions asked.  Of course it will be very easy for the RD to get details of all remittances to individual accounts. 

When transferring money over to my bank in Thailand, I am asked by Wise to declare the 'reason'. I cannot remember all of them, but it appears on the Thai bank statement/book as 'Foreign TT'.  I always keep the amount under US$10K because that is the amount that triggers some 'reporting' requirements (post 9/11). 

[newnative]

On 10/22/2023 at 9:38 AM, redwood1 said:

The Chinese, Indian, and Russian ex-pats....Are not going to lift a finger to understand or comply with any of this- ever .....Watch and see....

     I'm an American and I'm not planning to 'comply' either.  After reading 100+ pages of mostly speculation, I haven't the foggiest idea of how I would 'comply', even if I wanted to.  I'm certainly not going to voluntarily file a Thai tax return.  I am retired and I don't work in Thailand--or anywhere else. 

    I earn Social Security and a Virginia government pension, both of which I believe are protected from Thai taxation by the dual taxation agreement.   I earn dividends of approximately $10,000 a year, currently maintained in a Schwab account.  This, I believe, is subject to taxation, but only if remitted to Thailand, where it becomes 'accessible' for taxation.  Not sent to Thailand, not accessible, not subject to Thai tax--at least that is my understanding at this point.  I will not be sending any dividend income to Thailand.

    I will continue to send SS and pension money, from time to time, using Wise, to fund my living expenses in Thailand.  At one point I was considering changing my SS deposits to my Thai bank but I think I will hold off on that for now.  In the unlikely event I am ever called upon to show documentation, my USA bank statements only show monthly deposits of the SS and pension income--and I only use this bank to send funds to Thailand.  I suppose if I wanted to be truly precise for documentation, I could make my Wise transfers the exact amount of the total of a monthly SS and pension payment.  My dividend income, which I was going to start sending to my USA bank, will remain in my separate Schwab account.

[TroubleandGrumpy]

3 hours ago, sidneybear said:

I'm in Australia at the moment. Hardly anyone uses cash here. People are happy to tap and pay a higher price that includes a bank surcharge. Only 1 or 2 percent, but it adds up.

 

I insist on using cash. Some places love it (they probably don't declare it to the taxman). A couple of places offer a discount for using it. Other places refuse it.

If/when you move to Thailand - then I recommend you do the same - use cash only.

Here everyone takes it and some places (vendors, markets) just dont use cards. 

Just be aware that an ATM withdrawal at any other bank outside your Province will charge 15 Baht, so make the withdrawal a large amount (same fee no matter amount of withdrawal).

 

[TroubleandGrumpy]

56 minutes ago, Longwood50 said:

There is a basic law of economics. 
You subsidize things you want more of

You tax things you want less of
You  tax things like gas guzzling cars, cigarettes, alcohol, in part to reduce the purchase of them.  
There is an old adage that Be Careful What You Wish For Because It May Come True
About the time that there is a diminished expatriate population in Thailand and the taxi drivers, hospitals, restaurants, condo developements etc also don't have customers, only then will the politicians realize that for every action there is a reaction and in this case I suggest Thailand not the foreigner who chooses not to come will be the loser. 

That is logical. But this is Thailand, and they will blame everything from gun killings, to boat disasters, to weather events, to global warming, to slow world economy, to slow China economy, to high Baht, to US China disputes, to Ukraine Russia war, to Israel Palestimne conflicts, to everything and anything - but they will never never ever blame themselves or their decisions. 

[TroubleandGrumpy]

21 minutes ago, The Cyclist said:

I do not think that there is many who are declaring ' This will not apply to me '

 

The issue at the moment is that we do not know ' what will apply to whom '

 

As has been pointed out repeatedly. DTA's will apply, and what is covered is covered is dependant on the Your Country / Thailand DTA.

 

Thailand has 61 DTA's with other Countries. Which will encompass a barrowload of work for the RD when they have to go through those DTA's for every single expat covered by a DTA.

 

So it would come as no surprise to hear a blanket statement being issued stating that X, Y and Z incomes ( probably pensions / social security etc ) are exempt for people from those Countries are exempt.

 

As I said yesterday. It would be prudent to abide by your Country / Thailand DTA and limit your exposure before 01 Jan 2024 to potentially being skelped with Thai taxation.

 

You do not require a further announcement from the RD to put this into practice.

 

Common sense tells you to continue remitting to Thailand income / money covered by a DTA and stop remitting income / money to Thailand that is not covered by a DTA.

 

Absolutely no point in typing a 3000 word dissertation above about what you are going to do if Thailand does X. Take proactive steps to reduce the risk of X.

I hear what you are saying, and I agree this is all about what could be happenning - not absolutely 100% what is going to happen. But, you are very wrong about the 61 DTAs - if this goes ahead in its current form and all money remitted into Thailand is taxable income, unless proven otherwise.

 

If you think Thai RD will automatically not apply this new rule/interpretation for any money brought into Thailand from thos 61 DTAs then you are very wrong - obviously (tax avoiders will just use those countries). 

 

If you think it will simply be a matter of you/I saying 'IMO this is not taxable under DTA' then you are very wrong. How the DTA works is that when compiling our tax returns, we have to claim a 'credit' for taxes already paid in our DTA country - and substantiate that the tax has already been paid. The DTAs are created for businesses paying taxes, and for the people who are paid by those businesses - it is an extremely complex and difficult matter and not designed for people doing personal tax returns.

 

I posted details all about DTAs (including websites and Thai RD rulings) a long long time ago in this thread, and I know a little bit about what I am talking about - as does several other posters here who know more.  The issue now going forward is not about DTAs, it is about how this new rule/method will be implemented - if it goes ahead. As a few posters have said, if the Thai Govt does not delay implementation, this will be subject to a Court appeal. The current method has been ratified in the Tax Courts for over 30 years - Captain Smiley Picard cannot merely say 'make it so'.

 

Please continue to 'debate' - this is a good thing because it is very much being 'noticed'. Imagine if after this change was announced, there was zero social media feedback and criticism by Expats. That this topic is getting so much interaction (clicks) on Asean Now (and others), means it is being noticed by a lot of people in the tax 'industry' in Thailand, and that is a good thing - the squeaky wheel and all that. 

[Longwood50]

33 minutes ago, TroubleandGrumpy said:

but they will never never ever blame themselves or their decisions. 

Is that any different than any governement  Not to get into politics but take Donald Trump he was in office for 1 term 4 years and Biden spent 36 years in the Senate, 8 years as VP and now over 2 years as president but somehow he lays the blame on almost everything on Trump's doorstep.  No politician will ever step up and take the blame for their actions 

[TroubleandGrumpy]

Just now, Longwood50 said:

Is that any different than any governement  Not to get into politics but take Donald Trump he was in office for 1 term 4 years and Biden spent 36 years in the Senate, 8 years as VP and now over 2 years as president but somehow he lays the blame on almost everything on Trump's doorstep.  No politician will ever step up and take the blame for their actions 

True. But it is an artform here in Thailand 🙂

 

[Longwood50]

3 minutes ago, TroubleandGrumpy said:

True. But it is an artform here in Thailand

Churchill might disagree with you. 

[The Cyclist]

34 minutes ago, TroubleandGrumpy said:

f you think it will simply be a matter of you/I saying 'IMO this is not taxable under DTA' then you are very wrong.

I am stating that under the UK / Thai DTA my Government pension is not taxable in Thailand.

 

I can provide annual P60's and Statements of Future Payments to the RD if they wish to inspect them.

 

My Private Pension does not appear to be covered by the UK / Thai DTA  ( Even though it is taxed in the UK ) This is why it will no longer come into Thailand after the 01 Jan 2024.

 

Proactively removing a potential source of conflict with the RD.

 

Could you tell me where I have misunderstood the UK / Thai RD ?

 

The only confirmation that I require from the RD is whether I need to submit an annual ' Nil Return " or if I am exempt.

Edited October 23, 2023 by The Cyclist
additional text

[jerrymahoney]

37 minutes ago, TroubleandGrumpy said:

How the DTA works is that when compiling our tax returns, we have to claim a 'credit' for taxes already paid in our DTA country - and substantiate that the tax has already been paid.

The language "shall be taxable only in that (issuing) State" occurs in the US-Thailand DTA.

 

Even if some income is tax-free in the US and no US tax paid, it still could not be taxed in Thailand if so remitted.

 

Such income, even if required to be declared, would be exempt as in the RD FAQ:

 

9.    What is the method for elimination of double taxation provided in the(DTA)  agreement?  
- In a double taxation agreement, there are credit and exemption methods.  

[The Cyclist]

1 minute ago, jerrymahoney said:

The language "shall be taxable only in that (issuing) State" occurs in the US-Thailand DTA.

Ditto The UK / Thai DTA.

[TroubleandGrumpy]

56 minutes ago, The Cyclist said:

I am stating that under the UK / Thai DTA my Government pension is not taxable in Thailand.

I can provide annual P60's and Statements of Future Payments to the RD if they wish to inspect them.

My Private Pension does not appear to be covered by the UK / Thai DTA  ( Even though it is taxed in the UK ) This is why it will no longer come into Thailand after the 01 Jan 2024.

Proactively removing a potential source of conflict with the RD.

Could you tell me where I have misunderstood the UK / Thai RD ?

The only confirmation that I require from the RD is whether I need to submit an annual ' Nil Return " or if I am exempt.

 

You have misunderstood how the Thai tax system works - it is not simply a matter of you deciding anything.  IF you decide you are exempt and do not lodge a tax return - the Thai RD has the right and can review that decision - and they can do it going  backwards for many years (7 I believe, but maybe more).  IF you decide to lodge a tax return and IF the Thai RD does not agree with your 'decisions', they may decide to check further and review the matter - they could either let it go, or they will calculate what they think you owe, and either send you a bill (maybe), or request more information (more likely).  From there it would be wise for anyone to seek legal/tax advice before responding.

 

Under most tax laws, in most countries (not USA), a tax resident living in any country full-time is required to pay taxes on any earnings they have received anywhere in the world - using the DTAs to offset taxes alreasdy paid on earnings received in the source country. You can say 'but I did not bring that part to Thailand' , but that may still be liable to be taxed, and/or the Thai RD can decide 'no - you pay income tax'. 

 

Like yourself, I have a private source of money - savings and private super/pension fund. I will be seeing how things go going forward - and it could go either way.  But I do know that it is not my decision - it is the Thai RD's decision. And right now, according to most pundits, any remittance into Thailand could be viewed as taxable income - and where it goes from there with the appliucation of DTAs and clarifications and exemptions is anyone's guess.  

 

[TroubleandGrumpy]

1 hour ago, jerrymahoney said:

The language "shall be taxable only in that (issuing) State" occurs in the US-Thailand DTA.

Even if some income is tax-free in the US and no US tax paid, it still could not be taxed in Thailand if so remitted.

Such income, even if required to be declared, would be exempt as in the RD FAQ:

9.    What is the method for elimination of double taxation provided in the(DTA)  agreement?  
- In a double taxation agreement, there are credit and exemption methods.  

 

That is not your/my decision - the Thai RD is the sole arbitrator of what and what is not taxable income.

If you disdagree with their decision you can appeal (must be 100% in Thai) and even then take it to Court (also 100% in Thai).

 

One last time - BUT - if you are a USA Citizen  ....... , then your income worldwide is taxed in USA, and the IRS enforces (imposes) that arrangement very strongly on all other countries (do not tax our citizens or else).  This does not apply to citizens of any other country, that I am aware of.  So you are fine (assuming you are American), but all other DTAs are not structured the same way (that I am aware of).

 

[Seppius]

Bit of a long thread to go through, has it been discussed if UK state pensions will be affected by this, or what the treshhold is?

[TroubleandGrumpy]

2 hours ago, The Cyclist said:

I do not think that there is many who are declaring ' This will not apply to me '

 

The issue at the moment is that we do not know ' what will apply to whom '

 

As has been pointed out repeatedly. DTA's will apply, and what is covered is covered is dependant on the Your Country / Thailand DTA.

 

Thailand has 61 DTA's with other Countries. Which will encompass a barrowload of work for the RD when they have to go through those DTA's for every single expat covered by a DTA.

 

So it would come as no surprise to hear a blanket statement being issued stating that X, Y and Z incomes ( probably pensions / social security etc ) are exempt for people from those Countries are exempt.

 

As I said yesterday. It would be prudent to abide by your Country / Thailand DTA and limit your exposure before 01 Jan 2024 to potentially being skelped with Thai taxation.

 

You do not require a further announcement from the RD to put this into practice.

 

Common sense tells you to continue remitting to Thailand income / money covered by a DTA and stop remitting income / money to Thailand that is not covered by a DTA.

 

Absolutely no point in typing a 3000 word dissertation above about what you are going to do if Thailand does X. Take proactive steps to reduce the risk of X.

Again - what you are deciding is 'applicable' or 'taxable' under any DTA is exactly that - what you have decided.  What matters is what the Thai RD decides - and they have not provided that information or details.  

[jerrymahoney]

7 minutes ago, TroubleandGrumpy said:

 

That is not your/my decision - the Thai RD is the sole arbitrator of what and what is not taxable income.

If you disdagree with their decision you can appeal (must be 100% in Thai) and even then take it to Court (also 100% in Thai).

 

One last time - BUT - if you are a USA Citizen  ....... , then your income worldwide is taxed in USA, and the IRS enforces (imposes) that arrangement very strongly on all other countries (do not tax our citizens or else).  This does not apply to citizens of any other country, that I am aware of.  So you are fine (assuming you are American), but all other DTAs are not structured the same way (that I am aware of).

 

American.

[TroubleandGrumpy]

1 minute ago, Seppius said:

Bit of a long thread to go through, has it been discussed if UK state pensions will be affected by this, or what the treshhold is?

Yes - many times. Answers are everything from 'totally exempt' to 'potentially taxable income'.  Reality is that the Thai RD will soon? release details advising what is and is not 'taxable income' as far as they are concerned - which pending any Court over-ruling that decision, is what matters.  I understand that there are a few Thai people/companies currently developing appeals to the 'Tax Court' - but they may not be lodged if the Thai RD delays things for a while.  Their main reason for appeals is that to change 30+ years of an accepted and ratified in Court method is both wrong and unfair (no time to adjust financial planning). That is the main reason Malaysia delayed this change being implemented for 5 years.  IMO they are all waiting for PM Smiley to return form his business, trade, junkets and place some attention on this issue - besides being PM he is also the Finance Minister.  Dont worry - but stay across the issue - maybe do some reading. 

[TroubleandGrumpy]

7 minutes ago, jerrymahoney said:

American.

Thought so - lucky bugger 😉

The rest of us are in limbo until this is clarified.

It can be a pain having to pay taxes to USA when not even living there, but as this issue shows, having the 'big boy' on your side can be a huge advantage. 

 

[The Cyclist]

30 minutes ago, TroubleandGrumpy said:

ou have misunderstood how the Thai tax system works - it is not simply a matter of you deciding anything. 

 

How difficult is this to understand . I am not deciding anything.

 

An intergovernmental body has came up with the UK / Thai DTA, as part of that DTA and decided my Government Pension is only taxable in the UK.

 

The Thai Government can cancel that DTA in writing to the UK Government, giving 6 months notice. As of today I have nothing that suggests that the Thai Government has done so.

 

I did not even read the rest of your comment. If you cannot get the basics correct in your opening sentence, then there is not much scope for anything else in your comment being correct.

 

As I said previously, you can either whinge and bitch over the unknown or you can be proactive, read and digest your home Countries DTA with Thailand and take the appropriate steps to avoid being whacked with a Thai tax bill.

[paddypower]

19 hours ago, Guavaman said:

As previously mentioned, the allowance for health insurance premium paid (per actual expenditure) as documented by receipts from a health insurance company doing business in Thailand is 25k each per year. This amount is deductible from the amount of pension income remitted. But you can't short-cut the process by presenting payment for health insurance instead of pension income -- that is a false declaration = perjury. You remit assessable income from pension, then you pay for health insurance with those funds, which are then deduct from the amount of the income remitted.

 

If you directly remit funds to pay your health insurance premiums to a company doing business in Thailand, it could be characterized as income by the RD, if they interpret the remittance as the UK does under its' remittance-based taxation system. 

Understood. I'm not into perjury btw.

let me rephrase what I wrote - my exemptions cover my taxable income, including pension. but thanks for all the info. that you have quoted. very useful. 

[Guavaman]

The UK has a remittance-based system of income taxation for non-domiciled tax residents with foreign income, similar to what is being discussed for expat tax residents in Thailand. 

Under the remittance basis of taxation, you will pay tax on UK sources of income and gains, plus any foreign incomes and gains that you remit to (bring into) the UK. In effect, you can exclude foreign incomes and gains from UK taxation – providing that those incomes and gains are kept offshore.

 

On this thread, many work-arounds have been floated to bring funds into Thailand without being characterized as remittance of assessable income for tax purposes.

 

 So the main issue is -- What is a remittance?

 

There is not much detailed information on this in the Thai RD tax code, but the UK has a manual on remittances, which might provide some ideas that could surprise you.

 

Here is a thought exercise: “substitute ‘Thailand’ for ‘UK’ in the following examples” from HMRC Residence, Domicile and Remittance Basis Manual:

 

RDRM33050 - Remittance Basis: Practical Examples of Remittances to the UK

Money transfers to the UK

• You transfer some of your foreign income from your offshore bank account to your UK bank account.
• You withdraw some cash from your foreign bank account (that contains your foreign income) whilst overseas and bring the cash with you when you return to the UK.
• You give some of your foreign income to your spouse or civil partner who brings the money to the UK.
• You transfer some of your foreign income to the UK account of a registered Charity.
• You rent out your holiday home abroad and the customer pays the rent directly into your UK bank account.
• You loan some of your foreign income to a company you control overseas or settle some foreign income in an offshore trust. The company or trustees bring the money to the UK.
• You inherited money a few years ago that you deposited into a foreign interest bearing bank account and you transfer some of the money from this account to the UK. Although the inheritance is not taxable when remitted, the account will also contain taxable interest that will be treated as remitted before any of the non taxable inheritance.

Assets brought to the UK

• You buy an asset abroad with your foreign income and bring the asset to the UK.
• You buy a villa overseas using your foreign income which you then sell for a profit. You then transfer the sale proceeds to the UK. This is a remittance of the foreign income used to originally buy the overseas property as well as the foreign chargeable gain.
• You buy a house in the UK (or any other UK based asset) by making a payment of your foreign income to the seller’s overseas account.
• You buy shares or bonds in a UK registered plc from a foreign broker with your foreign income.

Services provided in the UK

• You transfer some of your foreign income from your overseas account to the overseas account of a trader who has provided you with a service in the UK.
• You buy a return air fare from New York to London overseas using your foreign income.
• You book a holiday with a foreign travel agent to sail from Southampton to New York which you pay for with your foreign income.
• You transfer some of your foreign income to the overseas account of a friend in exchange for using his cottage in the UK for a week.

Use of credit cards

• You use a credit card issued by a foreign bank in the UK for day to day expenditure and pay the credit card bill offshore using your foreign income.
• You use a credit card issued by a UK bank while on holiday abroad and pay the credit card bill using your foreign income

Offshore loans

• You take out a mortgage with an offshore bank to buy a house in the UK and make repayments to the bank from your foreign income.
• You take out a loan from an offshore bank secured against your foreign income held by the bank and use the money to fund your life in the UK. The loan requires you to repay the capital and interest after 15 years. As the loan does not have regular monthly repayments this is a remittance of the foreign income used as security when the loan is taken out.

Gifts to others

• You give some of your foreign income to a business colleague (or any other person) overseas who brings it to the UK and makes it available for your use.
• You make a gift of some of your foreign income to your adult son or daughter who lives abroad. Three years later your child gives some of these funds to their 16 year old child (your grandchild), who spends the money during a visit to the UK

Credit card issued in the UK

If a taxpayer who is chargeable on the remittance basis uses a UK credit card to pay for goods or services, either in the UK or overseas and they subsequently settle their credit card bill using foreign income or gains, the payment is a taxable remittance.  The remittance does not have to be received in the UK by the taxpayer, it is sufficient that it is received by the credit card company in the UK.

 

Credit card issued by an overseas bank or other financial institution

Where an overseas credit card is used in the UK, the cardholder is effectively authorising the credit card company to pay the bill for the goods or service in just the same way as if they had instructed the bank to make a payment directly to the person supplying the goods or services.

The use of the individual’s untaxed foreign income or gains to pay the credit card company in respect of the relevant debt will be a taxable remittance.

 

Debit card issued by an overseas bank or other financial institution

Payments for goods or services that are made using a debit card (for example a Visa debit card or one issued under the brand name ‘Cirrus’) issued by an overseas financial institution are treated in exactly the same way as a cash transaction.

 

This means that when goods or services are purchased in the UK using a debit card a taxable remittance is made to the extent of the amount of any overseas income or gains in the bank account. Likewise any cash withdrawals from shops or ATM machines in the UK are taxable cash remittances.

 

Payment by cheque drawn on an overseas account or by electronic transfer of any kind are also treated in exactly the same way as cash and are potentially taxable remittances of overseas income and gains.

 

Notes

The above list of examples is not exhaustive; there are many other ways in which remittances can occur.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

-------------------------

If and when the Thai RD gets around to fleshing out details of what constitutes a remittance, they might look to the UK manual for examples – but for now, there is little clarity on remittances to Thailand.

 

Meanwhile, residents of Thailand are well aware of the difference between having laws and enforcing them.

[SHA 2 BKK]

8 hours ago, TroubleandGrumpy said:

Yes they are very short sighted - both literally and figuratively. Hopefully someone in Thai RD and/or Cabinet will realise that 100,000 Expats bringing in an average of 1 Million Baht EVERY year, equates to 100 Billion Baht - or to put it another way - that equates to 2 Million 'high spending' Chinese Russian tourists they love so much for their money.  But according to some sites there are approx 200,000 non-working Expats living in Thailand (they dont keep official numbers), and that equates to 4 Million 'high spending' Chinese Russian tourists - which they spend a small fortune through TAT to get - and they  welcome with open arms, and 90 days exempt Visas, and the PM saying hello, etc etc etc. 

 

Meanwhile, in return for our 1 Million per year, we are all forced to 'report' every 90 days, complete TM30s, request 'permission to leave/re-enter and pay, request 'permission to stay another year. AND now it could be (not certain) that we are going to be forced to pay income taxes, unlike the Chinese Russian guests - but in return we get zero benefits or rights above what a Chinese/Russian tourist gets while they are in the country. 

 

Yes Thailand is short sighted and ignorant.  Meanhwile Malaysia and Philippines (and other countries nearby) are offering me so much more. They dont all do all this following list, but they all have no income taxes, no 90 day reporting, no annual begging to stay (auto renew 5 years, plus another 5).  Many of them also offer - customs duty exemptions on stuff brought into country, min sales tax on a new car, and a few others - and ............... wait for it (some countries) ............. the right to become a Resident and to buy a property with land (minimum value).

 

My Thai wife has made it very clear - we are not going to pay close to 2 Million baht in income taxes over 15 years to Thailand for nothing in return.  We will go live in a country nearby that gives me/us benefits in return for us living and spending all my money there. Or we will return to Australia and suck it up and just ignore all the woke left greenie crap. Although things may have started to turn in Australia - they just voted 'No Way' to giving the local Aborigines additional rights and benefits in the Constitution, despite all the MSM and all the woke lefty companies and organisations supporting it. Maybe we will go back earlier than planned. 

Errr it was a voice to Parliament only to the people that lived in Australia for 65,000 years before white settlement that was voted on.  No extra rights. Most Australians said no.  
 

But it don’t mean it’s woke to give em them a say - they looked after the country far better than most whities I know.  Best you stay in Thailand Cobber.  Pay your tax and look down on the locals.  Enough said. 

[bugger bognor]

On 10/21/2023 at 2:06 PM, beammeup said:

Well he said 200 pages of crap when it is only 114 pages of crap so he does have a trend towards exaggeration.

I said by Xmas ?

 

 

[The Cyclist]

1 hour ago, Guavaman said:

Here is a thought exercise: “substitute ‘Thailand’ for ‘UK’ in the following examples” from HMRC Residence, Domicile and Remittance Basis Manual:

 

If the thought exercise comes to fruition and Thaland adopts the UK system then @bugger bognor is absolutely correct and we have had a 100 and odd pages of crap.

 

Which brings us on to the UK / Thai DTA

 

Income from property situated in the UK.

 

Article 7

 

( 1 )  Income from immoveable property may be taxed in the contracting State where the property is located.

 

Which means that if you are paying tax in the UK on a rental property it should not be taxable in thailand.

 

Article 19

 

( 2 ) (a ) Any Pension paid by the contracting State ( Blah Blah Blah )  shall only be taxable in that State.

 

https://assets.publishing.service.gov.uk/media/5a80bddc40f0b623026953eb/uk-thailand-dtc180281_-_in_force.pdf

 

Article 19 Is referring to Government Pensions. I make no comment on whether a State Pension is classed as a Government Pension.

 

But that in itself throws up another interesting conundrum for the people who are claiming the State Pension and being taxed on it in the UK due to other Occupational Pensions.

 

 

[Dogmatix]

39 minutes ago, The Cyclist said:

 

If the thought exercise comes to fruition and Thaland adopts the UK system then @bugger bognor is absolutely correct and we have had a 100 and odd pages of crap.

 

Which brings us on to the UK / Thai DTA

 

Income from property situated in the UK.

 

Article 7

 

( 1 )  Income from immoveable property may be taxed in the contracting State where the property is located.

 

Which means that if you are paying tax in the UK on a rental property it should not be taxable in thailand.

 

Article 19

 

( 2 ) (a ) Any Pension paid by the contracting State ( Blah Blah Blah )  shall only be taxable in that State.

 

https://assets.publishing.service.gov.uk/media/5a80bddc40f0b623026953eb/uk-thailand-dtc180281_-_in_force.pdf

 

Article 19 Is referring to Government Pensions. I make no comment on whether a State Pension is classed as a Government Pension.

 

But that in itself throws up another interesting conundrum for the people who are claiming the State Pension and being taxed on it in the UK due to other Occupational Pensions.

 

 

 

"May be taxed in the contracting state where the property is located" does not mean taxing the income in Thailand is prohibited in Thailand. That would only be the case, if the wording were "....shall be taxed in the contracting state where the property is located."  That allows Thailand to choose between: not taxing it at all; allowing a tax credit and collecting the difference between Thai and UK tax, if Thai tax is higher; and charging full Thai tax and giving a Thai tax credit. The RD has already suggested it would allow tax credits.

 

The UK DTA is very clear in saying that only civil service and local government service pensions shall only be taxed in the UK. The state pension is not covered by this.