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

[Mike Lister]

Nothing to do with LTR visa's and I know it's boring, but this seems to be many peoples hot button at present:

 

I was snooping, looking for information on Thai tax when the criteria for needing to file a US tax return caught my eye, I partially quote below:

• If you earn less than the standard deduction for your filing status, you likely don't need to file a tax return. (but if you do then you do)
• Even if you don't meet the filing threshold, you may still have to file taxes if you have other types of income. For example, you may need to file if you earned self-employment income or income from interest or dividends.

https://turbotax.intuit.com/tax-tips/irs-tax-return/does-everyone-need-to-file-an-income-tax-return/L7pluHkoW

 

I then looked at the criteria for needing to file a tax return in some other countries and they were not dissimilar, in nearly all cases there are circumstances where a person is required to file, mostly because they have a certain type of income, despite them not having any tax to pay. In many of those cases, having income in excess of the standard deduction is a threshold. Now granted, Thailand doesn't have a standard deduction per se, instead it has TEDA and a personal allowance of 60k and a requirement to file at the 120k threshold. 

 

So when we consider the need to file or not to file a tax return in Thailand, using the assessable income threshold alone, that is no guarantee whatsoever that you were allowed not to file by law. That is true if the criteria used by other countries are applied and it's true if you take the TRD verbiage alone.

 

Where all those things take us is that we are told repeatedly by some members that "there is no penalty for not filing a tax a tax return, if no taxes were due".......or is there? Sherrings says this, and I paraphrase:

 

If you don't file a tax return, the TRD can order you to produce books, papers and evidence AND fine the person for not filing a return, period. If such an exercise determines that tax was due, additional penalties  become due. 

 

https://sherrings.com/tax-evasion-not-filing-tax-returns-thailand.html#:~:text=Whoever intentionally avoids (evades) payment,Both*.

 

My very clear interpretation of the above is that the TRD can make you produce whatever paperwork they require, and fine you for not filing a return (unless your income was under the 120k threshold), if that's what they wanted to do. Their ability to do those things is very clearly present, whether or not they would is a totally different subject.

[hwas]

12 hours ago, JohnnyBD said:

I just received the following email regarding monies remitted to Thailand for LTR visa holders. It will definitely factor into my decision on whether to buy a LTR visa or just stay in my home country for 7 months next year when I need to remit big monies for a new condo and to replenish my THB accounts.

 

Dear Sir,

 

LTR Visa holders are tax exempt from income remitted into Thailand as long it wasn't earned in the same year. For example, any earnings before 2024 (savings) remitted into Thailand in 2024 will not be subjected to income tax.

 

Pension and dividends earned in 2024 and remitted in the same year would be subjected to income tax. We advise our clients to wait until the following tax year (calendar year in Thailand) to remit this income. Most people who hold the LTR will not have to pay tax as their savings are much more significant than their annual earnings.

 

You would meet all the requirements as a "Wealthy Pensioner" based on the information you provided. The success of your application will be dependent on the supporting evidence you are able to provide.

 

If you have any questions or would like to retain our services, please do not hesitate to contact us.

 

Sincerely,

Xxxx Xxxxx International * I blocked Company name to be polite

 

 

[hwas]

Since you deleted the sender details, I assume that this response did not come from BOI.  Here is the response I received from BOI regarding this issue:  

If you hold LTR Visa and transfer the money from your oversea account into Thailand account, it will be considered as oversea income which will be exempted from Thai tax with LTR Visa benefit.

[Mike Lister]

3 minutes ago, hwas said:

Since you deleted the sender details, I assume that this response did not come from BOI.  Here is the response I received from BOI regarding this issue:  

If you hold LTR Visa and transfer the money from your oversea account into Thailand account, it will be considered as oversea income which will be exempted from Thai tax with LTR Visa benefit.

That seems to be closer to the horses mouth and seems more likely. But as always, the devil is in the detail. With all due respect to the earlier poster who is not unreasonably trying to get to the bottom of the matter, an agents interpretation of what is already cloudy and the subject of interpretation by everyone else, probably doesn't add value.

Edited April 18 by Mike Lister

[TroubleandGrumpy]

56 minutes ago, Mike Lister said:

Nothing to do with LTR visa's and I know it's boring, but this seems to be many peoples hot button at present:

 

I was snooping, looking for information on Thai tax when the criteria for needing to file a US tax return caught my eye, I partially quote below:

• If you earn less than the standard deduction for your filing status, you likely don't need to file a tax return. (but if you do then you do)
• Even if you don't meet the filing threshold, you may still have to file taxes if you have other types of income. For example, you may need to file if you earned self-employment income or income from interest or dividends.

https://turbotax.intuit.com/tax-tips/irs-tax-return/does-everyone-need-to-file-an-income-tax-return/L7pluHkoW

 

I then looked at the criteria for needing to file a tax return in some other countries and they were not dissimilar, in nearly all cases there are circumstances where a person is required to file, mostly because they have a certain type of income, despite them not having any tax to pay. In many of those cases, having income in excess of the standard deduction is a threshold. Now granted, Thailand doesn't have a standard deduction per se, instead it has TEDA and a personal allowance of 60k and a requirement to file at the 120k threshold. 

 

So when we consider the need to file or not to file a tax return in Thailand, using the assessable income threshold alone, that is no guarantee whatsoever that you were allowed not to file by law. That is true if the criteria used by other countries are applied and it's true if you take the TRD verbiage alone.

 

Where all those things take us is that we are told repeatedly by some members that "there is no penalty for not filing a tax a tax return, if no taxes were due".......or is there? Sherrings says this, and I paraphrase:

 

If you don't file a tax return, the TRD can order you to produce books, papers and evidence AND fine the person for not filing a return, period. If such an exercise determines that tax was due, additional penalties  become due. 

 

https://sherrings.com/tax-evasion-not-filing-tax-returns-thailand.html#:~:text=Whoever intentionally avoids (evades) payment,Both*.

 

My very clear interpretation of the above is that the TRD can make you produce whatever paperwork they require, and fine you for not filing a return (unless your income was under the 120k threshold), if that's what they wanted to do. Their ability to do those things is very clearly present, whether or not they would is a totally different subject.

Your 'very clear interpretation 'needs to be clearly caveated that you (and I) are NOT a tax experts and not qualified to give taxation advice.

Unfortunately some people think comments made by yourself and some others is that of a qualified expert - and they may follow that advice, and then if it goes all pear shaped they might sue you/AN.

 

On the point at hand - I will state this yet again. There are 10s of millions of Thais that do not lodge tax returns, but they earn over the minimum technical requirement as you note.  I will state that perhaps many of them after deductions allowances etc do not have any income tax to pay - maybe.  But they have received the income level you claim is absolute - and yet TRD does nothing about that - it is a well known fact.  Any attempt to clamp down on and fine Expats who dont file, will probably result in (besides Expats quitting the country) in human rights and/or discrimination complaints by Expats groups.  If the TRD clamps down on ALL Thais then Expats will possibly be caught up in the net - but if they target Expats in particular, the blowback will be extreme. 

[Yumthai]

1 hour ago, Mike Lister said:

My very clear interpretation of the above is that the TRD can make you produce whatever paperwork they require, and fine you for not filing a return (unless your income was under the 120k threshold), if that's what they wanted to do.

The single one fine modality for not filing tax returns is given in the link from Sherrings you quote: "200% of the assessed amount of tax that is payable". No other penalty is mentioned. In other words, no tax due no fine.

Edited April 18 by Yumthai

[Mike Lister]

3 minutes ago, TroubleandGrumpy said:

Your 'very clear interpretation 'needs to be clearly caveated that you (and I) are NOT a tax experts and not qualified to give taxation advice.

Unfortunately some people think comments made by yourself and some others is that of a qualified expert - and they may follow that advice, and then if it goes all pear shaped they might sue you/AN.

 

On the point at hand - I will state this yet again. There are 10s of millions of Thais that do not lodge tax returns, but they earn over the minimum technical requirement as you note.  I will state that perhaps many of them after deductions allowances etc do not have any income tax to pay - maybe.  But they have received the income level you claim is absolute - and yet TRD does nothing about that - it is a well known fact.  Any attempt to clamp down on and fine Expats who dont file, will probably result in (besides Expats quitting the country) in human rights and/or discrimination complaints by Expats groups.  If the TRD clamps down on ALL Thais then Expats will possibly be caught up in the net - but if they target Expats in particular, the blowback will be extreme. 

I'll caveat all my observations, findings and interpretations, as and when everyone else does exactly the same, including you. Until then we'll return to the real world, safe in the knowledge that this is a social media platform where membership requires everyone to understand there is no liability on the part of the site or its members for any opinion that is expressed on the sites servers that are located in Hong Kong!!!

 

Now, we're done discussing me, the subject is Thai taxation and I hope you understand that.

 

My observations are that Thailand has far more laws on its books than it actually enforces, in fact, enforcement is a weakness across the board, as most people understand. When the choice is to enforce or ignore, the path of least resistance is to ignore. That doesn't mean to say that the ability to enforce won't one day be decided to be useful. Not necessarily enforce everything, just enforce the things that are useful to enforce. But we've been down this well discussed path many times in this thread, there's no pint going down it again.

 

 

 

[Mike Lister]

4 minutes ago, Yumthai said:

The single one fine modality for not filing file returns is given in the link from Sherrings you quote: "200% of the assessed amount of tax that is payable". No other penalty is mentioned. In other words, no tax due no fine.

Everyone can feel to interpret those statements as they wish, I interpret them differently and just because the fine for not filing a return is not mentioned, doesn't mean there isn't one. At a minimum, I think it's indisputable that TRD has the ability to demand documentation and an investigation for people who do not file, if they so choose.

[Captain Monday]

On 4/15/2024 at 10:58 PM, JimGant said:

 

You didn't need to file a return? You mean you filed a tax return with assessable income below 120k? Or with blank lines, because you had no assessable income? You like rubbing elbows with bureaucrats, and wasting a day, or part thereof, in an unnecessary endeavor? Seriously, this aspect of your dealing with RD has come up before -- with no logical answer.

 

Cough, cough -- how about, barf, barf.

I filed the returns to scrape back some of the interest on saving  account that was confiscated. My only income in Thailand has ever been from savings account and I used to keep a large amount here gaining a nifty return. Never took more than 30 minutes rubbing elbows with some nice ladies ad the local revenue office. 

Edited April 18 by Captain Monday

[Mike Lister]

One last thought on this business of filing a return.

 

All the statements that have been quoted on this subject have set out the circumstances under which a person must file a return, I cannot recall seeing any that set out when a person is not required to do so. I therefore wonder why it is that a majority of forum members seem to want even more confirmation and greater proof of the need to file. Surely the shoe should be on the other foot, those members should be posting proof that filing is not required! Clear statements of that fact, statements that set out unequivocally that filing is not required, just as they are demanding to the contrary. I mean, I don't know with absolute certainty if the law says we must file or not but my interpretation is that we should. It's odd that nobody feels the same way, in the absence of any contrarian evidence.

Edited April 18 by Mike Lister

[JohnnyBD]

1 hour ago, hwas said:

Since you deleted the sender details, I assume that this response did not come from BOI.  Here is the response I received from BOI regarding this issue:  

If you hold LTR Visa and transfer the money from your oversea account into Thailand account, it will be considered as oversea income which will be exempted from Thai tax with LTR Visa benefit.

I copied and posted the exact email from the Law firm (Company) that was sent to me. I xx'd out the first name, but left International, so you can probably figure out who it is. Did BOI respond to you in writing, by email or was it by word of mouth? Not doubting what you say, but it would be nice to see their official response. I am very hopeful that what you wrote is the rule, then I won't have any worries. Thanks...

Edited April 18 by JohnnyBD

[hwas]

By email.  I also received the following by email

“We want to clarify that the tax exemption for overseas income will commence from the month you receive the LTR Visa onward, which typically falls within the next tax year. 

 

Any income earned in the period prior to holding the LTR Visa will not be considered for tax exemption.”

[JimGant]

31 minutes ago, Mike Lister said:

I don't know with absolute certainty if the law says we must file or not but my interpretation is that we should. It's odd that nobody feels the same way

 My latest household worker is payed a starting wage of 400baht per day. Six days a week, for 52 weeks, equals: 124,800 baht. Wow! Under the law, even tho' he's miles away from owing any tax, he's required to file a tax return. I'm going to call him in right now for a lecture on why he needs to file a tax return. NOT!

 

"It's odd that nobody feels the same way."  No, it's common sense.

[JimGant]

11 hours ago, Dogmatix said:

However, it could be argued that an occupational private pension is income from an employment but a private pension set up by the pensioner which is not directly paid by the former employer would be a stretch.

I saw somewhere that pensions are considered income by Thailand. No further elaboration, but I would think both defined benefit (employer paid) and defined contribution (paid from current income) would qualify.

[JimGant]

14 hours ago, JohnnyBD said:

What's the point in getting a LTR visa if that's the case. That doesn't give LTRs any special privileges over non-LTRs.

Sure it does -- it grandfathers you into the old rules, so that you can remit all your 2024 income into Thailand on Jan 1 2025, without incurring a tax situation. That option's gone for non LTR visa holders. But, need to await further info from BoI.

[JohnnyBD]

48 minutes ago, hwas said:

By email.  I also received the following by email

“We want to clarify that the tax exemption for overseas income will commence from the month you receive the LTR Visa onward, which typically falls within the next tax year. 

 

Any income earned in the period prior to holding the LTR Visa will not be considered for tax exemption.”

Thanks for posting. I was planning to wait and get my LTR in May 2025, but based on their response, any income I earn in 2024 & 2025 up until May 2025, and then remit to Thailand is not tax-exempt. That's bad news for me. I will need to make adjustments to my plans.

[JohnnyBD]

Jim, please look at what hwas wrote in his post about what BOI told him. He said we are not grandfathered in. All income prior to getting a LTR does not qualify as tax exempt.

23 minutes ago, JimGant said:

Sure it does -- it grandfathers you into the old rules, so that you can remit all your 2024 income into Thailand on Jan 1 2025, without incurring a tax situation. That option's gone for non LTR visa holders. But, need to await further info from BoI.

 

1 hour ago, hwas said:

By email.  I also received the following by email

“We want to clarify that the tax exemption for overseas income will commence from the month you receive the LTR Visa onward, which typically falls within the next tax year. 

 

Any income earned in the period prior to holding the LTR Visa will not be considered for tax exemption.”

 

Edited April 18 by JohnnyBD

[Mike Lister]

1 hour ago, JimGant said:

 My latest household worker is payed a starting wage of 400baht per day. Six days a week, for 52 weeks, equals: 124,800 baht. Wow! Under the law, even tho' he's miles away from owing any tax, he's required to file a tax return. I'm going to call him in right now for a lecture on why he needs to file a tax return. NOT!

 

"It's odd that nobody feels the same way."  No, it's common sense.

Where is it written in the Thai tax code, or in any other tax code for that matter, that common sense must prevail in all tax regulations and not only that but Jim Gant's idea of what is common sense!

[SHA 2 BKK]

1 hour ago, JimGant said:

Sure it does -- it grandfathers you into the old rules, so that you can remit all your 2024 income into Thailand on Jan 1 2025, without incurring a tax situation. That option's gone for non LTR visa holders. But, need to await further info from BoI.

And no stupid 90 day reports!     Quick access through airports.  Just keep earnings offshore for 12 months (I get 6% on these deposits) and bring in the following year “TAX FREE”.  All the way with LTR!  

[SHA 2 BKK]

1 minute ago, SHA 2 BKK said:

And no stupid 90 day reports!     Quick access through airports.  Just keep earnings offshore for 12 months (I get 6% on these deposits) and bring in the following year “TAX FREE”.  All the way with LTR!  

I must admit though, I got my LTR in 2022 when the old tax rules still applied.   Anyone getting their LTR this year needs to make sure they remit income from previous years as I did when I first got my LTR.  

[JimGant]

1 hour ago, JohnnyBD said:

Jim, please look at what hwas wrote in his post about what BOI told him. He said we are not grandfathered in. All income prior to getting a LTR does not qualify as tax exempt.

Yes, but all income after you get your LTR visa, remitted in the next tax year, is exempt. Non LTR holders no longer get this perk -- so I would say that's grandfathering for LTR holders.

[redwood1]

4 hours ago, TroubleandGrumpy said:

Your 'very clear interpretation 'needs to be clearly caveated that you (and I) are NOT a tax experts and not qualified to give taxation advice.

Unfortunately some people think comments made by yourself and some others is that of a qualified expert - and they may follow that advice, and then if it goes all pear shaped they might sue you/AN.

 

On the point at hand - I will state this yet again. There are 10s of millions of Thais that do not lodge tax returns, but they earn over the minimum technical requirement as you note.  I will state that perhaps many of them after deductions allowances etc do not have any income tax to pay - maybe.  But they have received the income level you claim is absolute - and yet TRD does nothing about that - it is a well known fact.  Any attempt to clamp down on and fine Expats who dont file, will probably result in (besides Expats quitting the country) in human rights and/or discrimination complaints by Expats groups.  If the TRD clamps down on ALL Thais then Expats will possibly be caught up in the net - but if they target Expats in particular, the blowback will be extreme. 

 

This is a good point regarding the vast and huge majority of Thais have never filed a tax form in their life....A most likely the numbers of Thais that should have been filing but never have must be in the XX millions and millions...

 

In the USA the IRS says openly They do not want anyone filing taxes if your income is below a certain level ...

 

To be honest if it was not for the handful of serial posters here who have made it their life mission to keep this thread alive........This thread would be buried on page 6-7-8-9  where it should be...

[Mike Lister]

4 minutes ago, redwood1 said:

 

This is a good point regarding the vast and huge majority of Thais have never filed a tax form in their life....A most likely the numbers of Thais that should have been filing but never have must be in the XX millions and millions...

 

In the USA the IRS says openly They do not want anyone filing taxes if your income is below a certain level ...

 

To be honest if it was not for the handful of serial posters here who have made it their life mission to keep this thread alive........This thread would be buried on page 6-7-8-9  where it should be...

I don't understand what your argument is or the point you're trying to make, let me summarise!

 

The IRS doesn't want people filing if they earn below certain level.

Millions here earn above the required level to file but don't.

Let's not talk about it.

 

Is that about right?

 

[JimGant]

Interesting, maybe BoI has it wrong, and the law firms have it right.... A Google on this gets almost the same from three law firms I clicked on, namely:

Quote

An income tax exemption is also offered to the other three categories of foreigners eligible for a LTR Visa: Wealthy Global Citizens, Wealthy Pensioners and Work-from-Thailand Professionals.

The exemption applies to income of the previous tax year arising from a post or business carried on abroad or arising from assets located abroad , that has been brought into Thailand.

https://www.hlbthai.com/tax-benefits-for-long-term-resident-ltr-visa-holders/

 

And this from the translation of Royal Decree 743, the guidance for this LTR exemption:

 

Quote

Section 5 Income tax under Part 2 of Chapter 3 in Title 2 of the Revenue Code shall be
exempted for a foreigner categorised as Wealthy Global Citizen, Wealthy Pensioner, or Work- from-Thailand Professional who is granted a Long-Term Resident Visa under immigration law for assessable income under section 40 of the Revenue Code derived in the previous tax year from an employment, or from business carried on abroad, or from a property situated abroad, and brought into Thailand.

 

Hmmmm.

[Presnock]

3 minutes ago, Mike Lister said:

I don't understand what your argument is or the point you're trying to make, let me summarise!

 

The IRS doesn't want people filing if they earn below certain level.

Millions here earn above the required level to file but don't.

Let's not talk about it.

 

Is that about right?

 

The LTR is advertised by the BOI stating that foreign earned income remitted into Thailand is not taxable if you have an wealthy pensioner LTR that is the advertised benefit.  It further states that if you earn assessable income within Thailand you do have to pay the tax.  I still do not understand why these questions continue daily/hourly or whatever when NO ONE really knows what the final regulations will be so we all should just wait until that time comes around.  

[Mike Lister]

23 minutes ago, Presnock said:

The LTR is advertised by the BOI stating that foreign earned income remitted into Thailand is not taxable if you have an wealthy pensioner LTR that is the advertised benefit.  It further states that if you earn assessable income within Thailand you do have to pay the tax.  I still do not understand why these questions continue daily/hourly or whatever when NO ONE really knows what the final regulations will be so we all should just wait until that time comes around.  

I agree with that 100%.

 

It looks like the quotes system is all screwed up, it's difficult to tell now who said what and who's replying to whom!

 

 

Edited April 18 by Mike Lister

[JimGant]

For US taxpayers, particularly the retirees reading this thread, if you have taxable income (i.e., gross income exceeds standard deduction/itemized deductions), and you owe taxes-- yes, you have to file and enclose a check -- or a penalty and or fine will ensue (just like Thailand).

 

But if you over withhold, or pay excessive estimated taxes -- and thus don't owe any taxes -- you do NOT have to file a tax return (unless you're self employed; need to file alternative minimum tax; owe Social Security taxes on unreported tips; and several other situations retirees reading this won't find themselves in). Bottom line: If you don't owe taxes, no need to file (unless, of course, you want your overpayment refunded).

 

 I mention all this, because when I croak, the wife wouldn't have the foggiest on how to file a tax return, nor even how to download the 1099s. And there  are no US tax preparers in Chiang Mai (that I know of), plus even if there were, the wife probably couldn't assemble the paperwork required (1099s). And hiring a Bangkok tax preparer (some charging $400, a few less) would, again, require assembling the paperwork.

 

So, I've set it up that she'll over withhold by about $450, which will cover all the income the IRS will see via 1099, plus income from Thai bank accounts. This will save $400 in tax preparer fees, with some margin, plus no hassle for the wife. Easy -- all because I know, because of her over withholding, she's not required to file a tax return. And, yes, she does have some Thai assessable income over the 120k boundary -- but not enough to have Thai taxable income. So, of course, I've advised her to not even consider filing a Thai tax return --

 

 

[JimGant]

59 minutes ago, Presnock said:

I still do not understand why these questions continue daily/hourly or whatever when NO ONE really knows

We do know LTR Wealthy Pensioners will have a tax break over non LTR visa holders. The current question remains: Does that tax break require current year income be remitted next year? Whatever it shakes out to -- LTR visa has a tax advantage.

[redwood1]

20 hours ago, stat said:

The only reason I can think if that they only issued 5500 LTR visa and were hoping for a lot more.

 

I would say the number of people who have 80,000 dollars a year in passive income are very few in number.....Heck I have a friend who had a good government job in the USA and he only gets a pension of 50,000 dollars a year....Even with Social Security he still does not get 80,000 dollars a year...

 

No wonder they have only issued 5500 LTRs.........What is that like 2% of all expats?

 

What were they thinking that expats would have 80,000 dollars a year appear from nowhere....

[Mike Lister]

25 minutes ago, JimGant said:

For US taxpayers, particularly the retirees reading this thread, if you have taxable income (i.e., gross income exceeds standard deduction/itemized deductions), and you owe taxes-- yes, you have to file and enclose a check -- or a penalty and or fine will ensue (just like Thailand).

 

But if you over withhold, or pay excessive estimated taxes -- and thus don't owe any taxes -- you do NOT have to file a tax return (unless you're self employed; need to file alternative minimum tax; owe Social Security taxes on unreported tips; and several other situations retirees reading this won't find themselves in). Bottom line: If you don't owe taxes, no need to file (unless, of course, you want your overpayment refunded).

 

 I mention all this, because when I croak, the wife wouldn't have the foggiest on how to file a tax return, nor even how to download the 1099s. And there  are no US tax preparers in Chiang Mai (that I know of), plus even if there were, the wife probably couldn't assemble the paperwork required (1099s). And hiring a Bangkok tax preparer (some charging $400, a few less) would, again, require assembling the paperwork.

 

So, I've set it up that she'll over withhold by about $450, which will cover all the income the IRS will see via 1099, plus income from Thai bank accounts. This will save $400 in tax preparer fees, with some margin, plus no hassle for the wife. Easy -- all because I know, because of her over withholding, she's not required to file a tax return. And, yes, she does have some Thai assessable income over the 120k boundary -- but not enough to have Thai taxable income. So, of course, I've advised her to not even consider filing a Thai tax return -- and for heaven's sake, never do a Google search on "Mike Lister." 🙂

 

 

If you and your tag team can't stop the personal commentary, I'm very happy to leave all of this discussions on tax and let you four deal with everything, is that what you want because I can easily make it happen?