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

[UKresonant]

Anyway, I'll share my thoughts on where I think I need to go, with a slight financial tweak in home country, as a current non-resident preparing for the possibility of filing a Thai Tax return in future years (>2026 at least, and will get some sugar free popcorn for first half of 2025). Always expecting to also be Tax resident in the UK, as well as Thailand additionally  sometimes.

 

I think there is a need  to not mingle these source categories to allow a trail history, in order of preference for sending to Thailand;-

 

Group one

Savings from before 2024 (increasingly difficult to ringfence with paper trail)

Group two 

Four Pensions all taxed at source in the UK, (one GOV. Taxed in the UK only), so the will all generate and demonstrate tax paid that can be used for credit relief against for the amount of tax actually paid in the paid in the UK.  Thailand RD do not have a specific form for noting the expected credit relief so far, info this end just says to write to them?? Hope that becomes clearer.

 

"Go by the treaty"* Article 23 of the UK-Thailand DTA "(3) In the case of Thailand, United Kingdom tax payable in accordance with this Convention in respect of income from sources within the United Kingdom shall be allowed as a credit against Thai tax payable in respect of that income. The credit shall not, however, exceed that part of the Thai tax, as computed before the credit is given, which is appropriate to such item of income".  [the digest has No Relief against the non-Government pensions column but this is because there is not a specific mention in the treaty as note 4.Treaty does not include an article dealing with Non-Government pensions. Also, no relief for State Pension or ‘trivial commutation lump sum]

*HMRC Technician, today.

 

Group Three

Savings from taxed income whilst non-resident including remitted to Thailand. 

 

Group Four

Misc. wee bits and pieces (minor not worth defining)

 

Group  Five

a) ISA Dividends, they would be treated as normal dividends if remitted to Thailand as the Tax free UK wrapper is ignored.  (though all created from taxed income, this is effectively another minor pension, that at least one UK chancellor was promoting as retired income provision in the past. not for a DTA consideration it perhaps isn't)

b) State Pension no tax deducted (when it comes). 

c) Other Dividends or interest.

Noting b) and c) have potential to show more tax within Group Two, but trivial.

 

So on a scale of Group One most likely to remit to Thailand, to Group Five least likely! So I will try and keep the different groups isolated for future potential questioning  . A little project to get on with, but the questions could totally change again. May or not make things easier, in an ideal situation perhaps. 

 

UK DTA and Digest links

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

https://assets.publishing.service.gov.uk/media/5b05425fed915d1317445ed2/DT_Digest_April_2018.pdf

[Mike Lister]

1 hour ago, MistyBlue said:

I'm sorry but I respectfully put it to you that you presenting an opinion,  not a fact.

 

Your earlier questions bear no relation to tax residency.  That is already set out in the Thai RD website and that point seems fairly clear.

For the last time, answer the four questions.

[Mike Lister]

1 hour ago, Lorry said:

So, what does "Tax residency status in the year of remittance is irrelevant. " mean?

I am very confused now.

 

I don't think it makes a difference whether a tax resident in Thailand is Thai or foreigner. 

 

What some people write here is: if you receive income abroad in a year you are tax resident, and you then remit this money to Thailand in a year you are not a tax resident,  in this case you have to pay taxes for this money in the year you remit it to Thailand even you are not a tax resident. 

 

This leads to the consequence that you may be liable for taxes in a year even if you weren't in Thailand at all.

Mike has given an example. 

 

I find this absurd,  even if I understand the logic. This problem has been discussed earlier in this thread,  I attach 2 early posts which convinced me that tax residency in the year of remittance IS relevant.

Obviously, Baker McKenzie is not convinced.

 

Tax residency in the year of remittance absolutely must be relevant, how can it not be, foreigners cannot possibly be taxed on a  remittance they made to a country where they are not a neither a national or a tax resident! I can easily understand however why BM might believe it is not relevant for Thai nationals, a Thai person merely being out of the country for a year doesn't mean they escape tax on that remittance, in the same way they don't escape Thai taxation on overseas earnings.

[MistyBlue]

13 minutes ago, Mike Lister said:

For the last time, answer the four questions.

Ok, but we were talking about your claim that Thais and foreigners had different requirements for tax residency, which is not related to your questions.  Never-the-less I've answered your questions, your text in italics.

 

1) Are foreigners who are not tax resident in Thailand, allowed to remit funds here?   Yes

 

2) If the answer to (1) above is no, why?  N/A

 

3) If the answer to (1) above is yes, is that money potentially taxable, even though the foreigner is not resident or tax resident here?   If not resident when earned, no.  If resident when earned but not resident when remitted then currently not known and further clarity required.

 

4) If the answer to (3) is yes, why, how and on what basis?  N/A

[Mike Lister]

11 minutes ago, MistyBlue said:

Ok, but we were talking about your claim that Thais and foreigners had different requirements for tax residency, which is not related to your questions.  Never-the-less I've answered your questions, your text in italics.

 

1) Are foreigners who are not tax resident in Thailand, allowed to remit funds here?   Yes

 

2) If the answer to (1) above is no, why?  N/A

 

3) If the answer to (1) above is yes, is that money potentially taxable, even though the foreigner is not resident or tax resident here?   If not resident when earned, no.  If resident when earned but not resident when remitted then currently not known and further clarity required.

 

4) If the answer to (3) is yes, why, how and on what basis?  N/A

You answered question 3, If not resident when earned, no.

 

Whereas a Thai person is taxed on world wide income hence the answer is Yes.

[MistyBlue]

4 minutes ago, Mike Lister said:

Whereas a Thai person is taxed on world wide income hence the answer is Yes.

Please can you provide a source for your claim?  I think it is incorrect.

 

The Thai tax code states a person is only tax resident if in the country 180 days or more, it is silent on nationality and I can find no evidence in that code that Thais are taxed on worldwide income regardless of their tax residency status.  If you believe it be to the contrary, then please provide source and evidence of the information, it would be very useful.

[Lorry]

14 minutes ago, Mike Lister said:

a Thai person is taxed on world wide income

What makes you think so?

 

Oh, i see, MB posted the same question,  but much more polite.  Sorry.

Edited December 4, 2023 by Lorry

[Mike Lister]

Just now, MistyBlue said:

Please can you provide a source for your claim?  I think it is incorrect.

 

The Thai tax code states a person is only tax resident if in the country 180 days or more, it is silent on nationality and I can find no evidence in that code that Thais are taxed on worldwide income regardless of their tax residency status.  If you believe it be to the contrary, then please provide source and evidence of the information, it would be very useful.

The new tax law confirms it's true, Thai's are taxed on income that is earned overseas and remitted to Thailand, regardless of the year in which it was earned.

 

Are you getting there on this yet?

[Mike Lister]

Just now, Lorry said:

What makes you think so?

See the post above

[Mike Lister]

Yawn, I'm going back to bed, g'night.

[MistyBlue]

20 minutes ago, Mike Lister said:

The new tax law confirms it's true, Thai's are taxed on income that is earned overseas and remitted to Thailand, regardless of the year in which it was earned.

 

Are you getting there on this yet?

Where in "The new tax law" does it single out Thai nationals to be treated different against what would be an identical tax residency status as a foreigner?  I don't think it does.

Edited December 4, 2023 by MistyBlue

[Lorry]

8 minutes ago, Mike Lister said:

The new tax law confirms it's true, Thai's are taxed on income that is earned overseas and remitted to Thailand, regardless of the year in which it was earned.

 

Are you getting there on this yet?

I think you are very wrong,  nationally doesn't matter for Thai taxes (as in many other countries).

But I understand why you feel this way, you earlier gave an example: if you remit money into Thailand in a year you are not a tax resident,  are you supposed to file taxes ? As a non-tax resident? 

 

In English, order 161/2566 reads "a tax resident who has foreign income AND later brings this money into Thailand". My English is very limited,  maybe a native speaker can help: doesn't this wording assume that this person is a tax resident in both years/always? 

 

My Thai is even worse than my English,  I have no way to judge what the Thai version means. 

But it really doesn't matter,  it means what the RD will say it means. 

[Mike Lister]

1 minute ago, Lorry said:

I think you are very wrong,  nationally doesn't matter for Thai taxes (as in many other countries).

But I understand why you feel this way, you earlier gave an example: if you remit money into Thailand in a year you are not a tax resident,  are you supposed to file taxes ? As a non-tax resident? 

 

In English, order 161/2566 reads "a tax resident who has foreign income AND later brings this money into Thailand". My English is very limited,  maybe a native speaker can help: doesn't this wording assume that this person is a tax resident in both years/always? 

 

My Thai is even worse than my English,  I have no way to judge what the Thai version means. 

But it really doesn't matter,  it means what the RD will say it means. 

How can a foreigner whose only relationship with Thailand is their physical presence, be taxable on funds remitted to Thailand, when they are not present nor resident for tax? 

 

Misty: if you keep editing your posts after I've started to respond, we can't play any more! But to answer your question, it doesn't, that's not the point, the point is as I've just replied in this post above.

 

I'm off back to bed, g'night

[MistyBlue]

7 minutes ago, Mike Lister said:

But to answer your question, it doesn't, that's not the point, the point is as I've just replied in this post above.

But you said it did and that's what I responded to?

 

Here's your original post:

32 minutes ago, Mike Lister said:

The new tax law confirms it's true, Thai's are taxed on income that is earned overseas and remitted to Thailand, regardless of the year in which it was earned.

 

[Lorry]

1 hour ago, Mike Lister said:

How can a foreigner whose only relationship with Thailand is their physical presence, be taxable on funds remitted to Thailand, when they are not present nor resident for tax? 

Should read "their previous physical presence"

 

I completely agree, it would be absurd. 

[Mike Lister]

2 hours ago, MistyBlue said:

But you said it did and that's what I responded to?

 

Here's your original post:

 

Cool! Anyway, you've already agreed with me that foreigners have different capabilities regarding tax and funds transfers and that was the whole point of this, thanks, 

[Mike Lister]

8 hours ago, TravelerEastWest said:

 

I am not being sacrastic but very realistic. You have not cited any laws - sorry I am a retired tax guy and some of what you ay is good and some is somewhat less than useful and accurate - no need to take offense - this is serious business we are talking about at least for me it is. But that is OK this thread is just for bouncing thoughts and ideas around.

 

As for Thai nationals not escaping tax obligations they can leave Thailand just as foreigners can and any existing tax liens are hard to collect same as with a foreigner.

 

To be very clear the law is equally for Thais and foreigners who are tax residents which is what we are talking about. Unless you have laws that say otherwise and then I will say thank you for the update. Tax laws tend to be complicated and to think that any non native speaker of Thai or the rare talented foreigner with a very high level of Thai understand Thai laws is unrealistic. To trust that RD officials both understand and explain things correctly to you is not realistic. 

I'm just coming back to this for a moment for a couple of reasons.

 

There is a short exchange a little way further back between Lorry, Misty and myself, in it you'll see that there is the start of agreement that there is a difference, despite the law being the same for both, I suggest you read it. What your work was in your previous life, in a different country, doesn't count for anything here, I further suggest you also answer the four questions that I have put forward to see if you fare differently.

 

[MistyBlue]

19 minutes ago, Mike Lister said:

Cool! Anyway, you've already agreed with me that foreigners have different capabilities regarding tax and funds transfers and that was the whole point of this, thanks, 

No, I haven't agreed with you on this point at all.

[Mike Lister]

24 minutes ago, MistyBlue said:

No, I haven't agreed with you on this point at all.

You answered No to question 3 above, which is the opposite of what a Thai person can do. Do you now wish to change your previous answer?

[MistyBlue]

21 minutes ago, Mike Lister said:

 which is the opposite of what a Thai person can do

No, I don't believe there are different requirements between a Thai person and a foreigner in this regard who hold the same tax residence status.

 

24 minutes ago, Mike Lister said:

Do you now wish to change your previous answer?

No, I don't wish to change my previous answer.

[Mike Lister]

Just now, MistyBlue said:

No, I don't believe there are different requirements between a Thai person and a foreigner in this regard who hold the same tax residence status.

 

No, I don't wish to change my previous answer.

You can't qualify the question, the residence status and the ability to modify it is the reason for the difference.

[beammeup]

8 hours ago, cleanac said:

For people who have made a lot on crypto, what are you doing with regards to the tax rules next year?

Is there anybody here who has seen an accountant about it, and has some advice to share?

At the moment, it seems like the options are:

• Sell a chunk this month, before the new tax rules kick in.
• Take it on the chin, lose 15%
• Do something creative with tax loopholes
• Take a loan on AAVE to get cash into Thailand this tax year without actually selling
• Move to another country

I use it for living expenses and plan to buy property in the next couple of years, losing 15% will suck. I don't want to sell a lot right now if I can avoid it. Anyone have any better options/advice/ideas?

 

 

crypto bitcoin ethereum BTC ETH cryptocurrency

where does the 15% come from? I thought it was considered income so is taxed the same?  Progressive from 0% to 35%.

[MistyBlue]

2 minutes ago, Mike Lister said:

You can't qualify the question, the residence status and the ability to modify it is the reason for the difference.

The Thai Revenue department qualifies the status, here's the extract again which treats Thais and foreigners no in different in relation to their tax resident status.

 

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.

[Mike Lister]

Just now, MistyBlue said:

The Thai Revenue department qualifies the status, here's the extract again which treats Thais and foreigners no in different in relation to their tax resident status.

 

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.

It doesn't matter what the law says and it doesn't matter what the RD rules say, citing them is nothing more than an attempt at distraction!  I gave you a simple practical application to work through and you answered correctly. Now that you've realised that Thai's are taxed on their world wide income you are looking for ways to  backtrack. It's time to move on. 

[MistyBlue]

1 minute ago, Mike Lister said:

Now that you've realised that Thai's are taxed on their world wide income

No, I haven't realised that at all and I've been consistent in all my posts that I think that is simply incorrect.

 

5 minutes ago, Mike Lister said:

It doesn't matter what the law says and it doesn't matter what the RD rules say, citing them is nothing more than an attempt at distraction!

I quoted the revenue department because I believe it clarifies that Thais and Foreigners are treated no differently from a tax resident perspective and that your claims are incorrect.  I think citing the RD was quite appropriate for what we are discussing.

[Mike Lister]

1 minute ago, MistyBlue said:

No, I haven't realised that at all and I've been consistent in all my posts that I think that is simply incorrect.

 

I quoted the revenue department because I believe it clarifies that Thais and Foreigners are treated no differently from a tax resident perspective and that your claims are incorrect.  I think citing the RD was quite appropriate for what we are discussing.

OK Misty, I'm going to bring this circular exchange to an end because it is not productive or useful and is of no benefit. Nothing personal but I shall ignore any further posts from you.

[BritManToo]

1 minute ago, Mike Lister said:

OK Misty, I'm going to bring this circular exchange to an end because it is not productive or useful and is of no benefit. Nothing personal but I shall ignore any further posts from you.

Always interesting to see how many posters live their lives in abject fear. Fear of being taxed, fear of their own government, fear of the DWP, fear of COVID, climate change, et al.

Live for today, the future may never come.

[tomkenet]

16 hours ago, tomkenet said:

Does this mean a person can be taxed on remittance even he is not a tax resident that year if the money is earned a previous year when he was a tax resident.

From the same Baker McKenzie report, "Foreign sourced income is subject to tax in a taxable year in which it is remitted into Thailand."

[jerrymahoney]

41 minutes ago, BritManToo said:

Always interesting to see how many posters live their lives in abject fear. Fear of being taxed, fear of their own government, fear of the DWP, fear of COVID, climate change, et al.

Live for today, the future may never come.

I've already calculated that, with just the deductions currently available and no DTA type exemptions, my tax bill in Thailand would be abut $US 100 per month -- and with the DTA maybe ZERO.

 

So I don/'t really see where this abject fear nonsense comes into play.

[Mike Lister]

39 minutes ago, tomkenet said:

From the same Baker McKenzie report, "Foreign sourced income is subject to tax in a taxable year in which it is remitted into Thailand."

 

The statement about foreign sourced income only being liable to Thai tax when it is remitted is perhaps one of the oldest and most frequently posted statements in these discussions yet many have never seen it and many don't understand it!

 

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