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

[stat]

1 minute ago, EVENKEEL said:

Seems like a different thread is required for every country which has expats here in Thailand. Won't that be fun.

No there is no need for a different country thread. It is enough to know that Germans may have to pay and UK/US guys do most likely not have to pay and if you are Norwegian you need to check your own DTA to get an answer.

[Rimmer]

A baiting post has been removed

[TroubleandGrumpy]

4 minutes ago, EVENKEEL said:

Seems like a different thread is required for every country which has expats here in Thailand. Won't that be fun.

That is a good point - taxation is very country specific and each DTA ia also different, therefore it is very hard to discuss anything in too much detail with any certainty.  

[Tony M]

On 5/9/2024 at 6:37 AM, Mike Lister said:

I have read through the past few pages again and have tried to summarise some very fragmented and at times obscure explanations and make them understandable to everyone. I don't yet claim to have a 100% accurate or complete description but I think I'm nearly there, the following may be subject to change after others have reviewed and commented. 

 

The Tax Implications of Remittances

 

If you receive funds in Thailand, you must determine whether they represent assessable income or not. If they are assessable, you must report them on a tax return, subject to minimum threshold amounts. You are the only person who can do this because you are the only person who knows.

 

Similarly, if you remit funds to Thailand from overseas, to someone other than yourself, you must also determine if those funds are assessable and if they are, declare them on a tax return, subject to threshold amounts. Just because you remit funds to another person in Thailand and the money does not enter your bank account, does not mean those funds escape tax assessment.

 

For example, a remittance from your overseas account, to a Thai property developer, in order to buy property in Thailand, must still be assessed for Thai tax. If that remittance comprises exempt income, it does not need to be declared on a Thai tax return. But if it comprises taxable income, the money must be declared.

 

In a second example, funds that you remit to another person, from overseas, might be intended as a Gift, in which case, you do not need to report that Gift on a Thai tax return. However, the recipient of the Gift, may need to report the Gift and pay Gift Tax on the amount.

 

Along the same lines as the above, if somebody sends you money in Thailand, it may be deemed to be a Gift, which under Gift Tax rules is not assessable here, subject to the amounts involved. The Thai Revenue may require further details of that Gift to ensure it is genuine and not income disguised as a Gift.

 

As an over arching principle, the Thai Revenue does not care what the purpose is of the remitted funds, or their intended use. The Revenue is only interested in the amounts that you declare and what you say the source of those funds was, which you may need to prove, beyond doubt.

 

Mike, thank you for this. I apologise if this question has been asked before, but there is a lot of information to be looked though in this thread:

You, and others, have mentioned keeping records, and I have no problem with that.  When I need to submit  a tax return (P90, in my case), in early 2025, it will be a paper submission, based on remittances of savings in 2024, and based on the savings balance in my UK account at 31/12/23. So do I add a letter of explanation to the tax return (in English ?), and take it all along to the local tax office, along with all of the printouts, etc ?  Do I just put zeros in the "income" boxes on the form ?

[Mike Lister]

3 minutes ago, Tony M said:

Mike, thank you for this. I apologise if this question has been asked before, but there is a lot of information to be looked though in this thread:

You, and others, have mentioned keeping records, and I have no problem with that.  When I need to submit  a tax return (P90, in my case), in early 2025, it will be a paper submission, based on remittances of savings in 2024, and based on the savings balance in my UK account at 31/12/23. So do I add a letter of explanation to the tax return (in English ?), and take it all along to the local tax office, along with all of the printouts, etc ?  Do I just put zeros in the "income" boxes on the form ?

No! Just file your return and if the TRD has concerns or questions, answer them when they are asked.

[Mike Teavee]

1 hour ago, stat said:

@Mike Teavee Regarding the calculation of CGT: what makes you think the TRD calculation is based on tax laws of other countries? Which country laws should be used (asset sitiu i.e. bank, nationality of owner, tax residence of owner, jurisdiction of management of the company) ? This would be an absolute first for any country tax I ever heard of.

 

I am pretty sure TRD will (and have every right) to use their own calculation independant of other laws. If they codify their MO is another big question. My gut feeling tells me they will use Fifo but no one knows, however I am pretty sure the "tax laws of the asset" will not play into the calculation.

 

Think about it, you are not bringing the Asset over to Sell, you're remitting the proceeds of selling that Asset so the Gains are calculated according to the rules of the country of the Asset (If for no other reason than you could have a tax obligation in that country) E.g. if I'm resident in the UK & sell some shares on the DAX, I don't apply UK rules to calculate CGT, I apply German rules & then declare the net Gain to UK RD when I remit the monies.

 

Countries can tax that Gain at whatever rate they feel is appropriate & they can argue that you've got the calculation wrong, but they would have to do so by running through the CGT rules of the country of the Asset, and besides even if Thailand could use it's own calculation, it doesn't have any as it treats remitted Gains as Income Tax. 

 

Capital gains

Most types of capital gains are taxable as ordinary income. However, the following capital gains are exempt from tax:

• Capital gains on the sale of shares in a company listed on the Stock Exchange of Thailand, provided that the sale is made on the Stock Exchange of Thailand, and on the sale of investment units in a mutual fund.
• Gains on the sale of non-interest bearing debentures, bills, or debt instruments issued by a corporate entity, except in the case where the bonds or debt instruments were sold for the first time at a price lower than their redemption price to an individual.
• Gains on the sale of securities listed on stock exchanges in the Association of Southeast Asian Nations (ASEAN) member countries and traded through the ASEAN Link, excluding securities in the form of treasury bills, bonds, bills, or debentures.

 

 

https://taxsummaries.pwc.com/thailand/individual/income-determination

 

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

 

However, having said all that out loud (or rather Typed it loudly 🙂), if we are following the rules of the country of the Asset then surely Taper relief must come into it, but Expat Tax videos I've seen say that it's the Original Cost of the Asset that's used. 

 

If I were calculating the CGT on some UK shares, I'd use a standard UK CGT calculator which would include Taper Relief & have the documentation to back up my rationale for why I came to the number I did, Worse case would be TRD re-calculate it without the Taper Relief. 

Edited May 13 by Mike Teavee
Add PWC Link

[Dogmatix]

11 minutes ago, Mike Teavee said:

 

Think about it, you are not bringing the Asset over to Sell, you're remitting the proceeds of selling that Asset so the Gains are calculated according to the rules of the country of the Asset (If for no other reason than you could have a tax obligation in that country) E.g. if I'm resident in the UK & sell some shares on the SP500, I don't apply UK rules to calculate CGT, I apply US rules & then declare the net Gain to UK RD when I remit the monies.

 

Countries can tax that Gain at whatever rate they feel is appropriate & they can argue that you've got the calculation wrong, but they would have to do so by running through the CGT rules of the country of the Asset, and besides even if Thailand could use it's own calculation, it doesn't have any as it treats remitted Gains as Income Tax. 

 

Capital gains

Most types of capital gains are taxable as ordinary income. However, the following capital gains are exempt from tax:

• Capital gains on the sale of shares in a company listed on the Stock Exchange of Thailand, provided that the sale is made on the Stock Exchange of Thailand, and on the sale of investment units in a mutual fund.
• Gains on the sale of non-interest bearing debentures, bills, or debt instruments issued by a corporate entity, except in the case where the bonds or debt instruments were sold for the first time at a price lower than their redemption price to an individual.
• Gains on the sale of securities listed on stock exchanges in the Association of Southeast Asian Nations (ASEAN) member countries and traded through the ASEAN Link, excluding securities in the form of treasury bills, bonds, bills, or debentures.

 

 

https://taxsummaries.pwc.com/thailand/individual/income-determination

 

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

 

However, having said all that out loud (or rather Typed it loudly 🙂), if we are following the rules of the country of the Asset then surely Taper relief must come into it, but Expat Tax videos I've seen say that it's the Original Cost of the Asset that's used. 

 

If I were calculating the CGT on some UK shares, I'd use a standard UK CGT calculator which would include Taper Relief & have the documentation to back up my rationale for why I came to the number I did, Worse case would be TRD re-calculate it without the Taper Relief. 

 

PIT on domestic cap gains is almost unheard of in Thailand.  As you mention gains on SET listed stocks traded through the market and domestic funds are exempt.  As far as securities are concerned that leaves gains on sales of unlisted equities and gains on private off market sales of SET stocks which are not things the average PIT taxpayer ever home.  There is no cap gains tax on Thai property because there is a formula to work out taxes on property which have to paid at the Land Office.  The tax computation doesn't take into account the capital gains and it is considered separately from PIT, so that you can sell as many billions of baht worth of property at a huge profit as you like and won't increase your top marginal tax rate. 

 

This means that the average RD officer has little or know knowledge of Thai cap gains, let alone how they are treated in foreign tax jurisdictions or what tax credits they may qualify for for.

[Tony M]

52 minutes ago, Mike Lister said:

No! Just file your return and if the TRD has concerns or questions, answer them when they are asked.

 

Sorry, but I'm still confused. What information do I include on the form ?  Just zeros, as there is no assessable income ?

[Mike Lister]

Just now, Tony M said:

 

Sorry, but I'm still confused. What information do I include on the form ?  Just zeros, as there is no assessable income ?

If you have no assessible income, you do not need to file a return. The threshold is 60k or 120k based on the type  of income. There is even a question whether you need to file, if you have no tax to pay. If true, that could mean you could have assessable income of up to around 500k and still not have to file.

[Tony M]

8 minutes ago, Mike Lister said:

If you have no assessible income, you do not need to file a return. The threshold is 60k or 120k based on the type  of income. There is even a question whether you need to file, if you have no tax to pay. If true, that could mean you could have assessable income of up to around 500k and still not have to file.

 

I thought it had been established that, if you are tax resident, then you must file a tax return. Is that not the case ?  My remittances are from savings, so are you saying that I do not need to file any tax return at all, and I don't need to submit any evidence of savings pre-1/1/24  unless asked sometime in the future  ?

 

[dinga]

Recent Webinair for Australians

 

 

 

[Dogmatix]

1 hour ago, Mike Lister said:

The earlier post referred to Government age pensions and was not country specific. I imagine there will be some country DTA's that allow their government pensions to be taxed here but lets not suggest that is true of every country or even the majority.....that's what is scaremongering.

 

Most of the DTAs I have seen allow the country of residence to tax all pensions including home country state pensions (with the exemption of government pensions paid to former government employees).  The only one I have seen that doesn't allow general state pensions to be taxed in the country of residence is the US treaty.  Someone posted that the Dutch treaty says state pensions "shall" be taxed in Holland, which may be true but I haven't looked it up to verify this.  Many people get confused with the DTA wording that says "may be taxed" in the country of origin and believe this means that the country of origin has the sole right to the tax.  This is only true if the wording is "shall be taxed", as in the US treaty vis a vis Social Security, rather than "may be taxed".  That means that Thailand has the option to tax foreign state pensions or not and the RD has already declared its intention to tax all pensions that it can (subject to DTA tax credits).  This was affirmed in the Swiss embassy interview.  Of course, since nothing has been written down, there could easily be a Thai flip flop, when they understand the cost and trouble of collecting paltry amounts of tax from expat pensioners who are unable to do their own tax returns.

Edited May 13 by Dogmatix

[Mike Lister]

3 minutes ago, Tony M said:

 

I thought it had been established that, if you are tax resident, then you must file a tax return. Is that not the case ?  My remittances are from savings, so are you saying that I do not need to file any tax return at all, and I don't need to submit any evidence of savings pre-1/1/24  unless asked sometime in the future  ?

 

If you haven't already done so, please read the document linked below.

 

You only need to file a tax return, if you are tax resident AND if you have assessible income either above the threshold or such that you have to pay tax (you must decide whether to file or not in the case of the former.

 

If your remittances are from savings earned before 1 January 2024, those funds are exempt.

 

You do not need to submit evidence of anything until asked, same as in your home country.

 

 

[Mike Lister]

Just now, Dogmatix said:

 

Most of the DTAs I have seen allow the country of residence to tax all pensions including home country state pensions (with the exemption of government pensions paid to former government employees).  The only one I have seen that doesn't allow general state pensions to be taxed in the country of residence is the US treaty.  Someone posted that the Dutch treaty says state pensions "shall" be taxed in Holland, which may be true but I haven't looked it up to verify this.  Many people get confused with the DTA wording that says "may be taxed" in the country of origin and believe this means that the country of origin has the sole right to the tax.  This is only true is the wording is "shall be taxed", as in the US treaty vis a vis Social Security, rather than "may be taxed".  That means that Thailand has the option to tax foreign state pensions or not and the RD has already declared its intention to tax all pensions that it can (subject to DTA tax credits).  This was affirmed in the Swiss embassy interview.  Of course, since nothing has been written down, there could easily be a Thai flip flop, when they understand the cost and trouble of collecting paltry amounts of tax from expat pensioners who are unable to do their own tax returns.

The earlier exchange was about government pensions which appear to be exempt, at a minimum, in the US and UK DTA's.

[Sheryl]

7 minutes ago, Tony M said:

 

I thought it had been established that, if you are tax resident, then you must file a tax return. Is that not the case ?  My remittances are from savings, so are you saying that I do not need to file any tax return at all, and I don't need to submit any evidence of savings pre-1/1/24  unless asked sometime in the future  ?

 

You are not required to file if you gave no assessable income.

 

And indeed, even if you have assessable income, you break no law by not filing if you owe no tax (i.e. if your assessable income is below the threshold).

 

 

[Mike Lister]

1 minute ago, Sheryl said:

You are not required to file if you gave no assessable income.

 

And indeed, even if you have assessable income, you break no law by not filing if you owe no tax (i.e. if your assessable income is below the threshold).

 

 

Technically there is a fine that can be levied where the tax payer had assessible income in excess of the threshold but no tax was due, and they did not file a return. The fine is 2k Baht. 

[Dogmatix]

BTW I don't think RD audits for PIT that doesn't include business income are very common. Touch wood I have never had one and have not heard of anyone who had one other than a foreigner who ceased filing tax returns and they wanted to know why.  Audits are a lot more common for companies ( I have had one) and possibly sole trader businesses which are filed as PIT but are a lot simpler than company tax returns because most traders opt for a flat rate of expense deductions to avoid having to get audited accounts done.  

 

The MO of the RD vis a vis PIT is that after receiving your tax return, they will write to you asking for documents to clarify any income declared or deductions claimed that they don't already have an electronic record of and some that they do, eg PAYE salary and Thai dividends. So it is not like, say UK tax, where you make your declaration and they don't normally ask for any further evidence but may come back and do an audit.  The Thai RD is doing a mini audit when they receive the tax returns. 

 

The problem is of course that P. 161/2566 and P. 162/2566 plus all the DTAs can potentially cause serious disruption to the RD simple process of verification of Thai income and deductions and will potentially overload the system.  That is not to mention the obligation to be placed on RD officers to try to figure out the correct tax filing of expat pensioners for them, as 99.9% will be unable to file for themselves online like most Thais do nowadays.  Whether the snap judgements of inexperienced RD officers doing the filings for expats will be accepted or whether the next level up that reviews them will demand extensive additional documents to review remains to be seen.  

[JohnnyBD]

59 minutes ago, Dogmatix said:

 

PIT on domestic cap gains is almost unheard of in Thailand.  As you mention gains on SET listed stocks traded through the market and domestic funds are exempt.  As far as securities are concerned that leaves gains on sales of unlisted equities and gains on private off market sales of SET stocks which are not things the average PIT taxpayer ever home.  There is no cap gains tax on Thai property because there is a formula to work out taxes on property which have to paid at the Land Office.  The tax computation doesn't take into account the capital gains and it is considered separately from PIT, so that you can sell as many billions of baht worth of property at a huge profit as you like and won't increase your top marginal tax rate. 

 

This means that the average RD officer has little or know knowledge of Thai cap gains, let alone how they are treated in foreign tax jurisdictions or what tax credits they may qualify for for.

Mr. Dogmatix,

This Capital Gains thing is making my head spin. If you wouldn't mind, please share your thoughts on the following:

1. What if you sold stock or property in 2024 (that you bought 10 years ago) but you didn't remit any of it. You claimed any gains on your home country tax return for 2024. After that, it would seem to be savings, right? Then, somewhere down the line, maybe in 2026 or 2027, you remit that savings/money into Thailand. Would all of it be non-assessable or would the gains that you already paid tax on 3 years earlier be assessable income?

2. Same situation above, but you didn't have any gains. You still had to report the sale on your home country 2024 tax return, but no taxes, because no gains. Later you remit those monies to Thailand. Assessable or not?

3. You have $100k in savings (pre-2024 monies), earning interest monthly, and you transfer the interest out each month, and spend it, leaving the original $100k in the account to continue earning interest. Then, you remit the $100k in 2026 or 2027. The $100k was pre-2024 monies, right?. Would it be assessable or not?

Thanks.

Edited May 13 by JohnnyBD

[Dogmatix]

35 minutes ago, Sheryl said:

You are not required to file if you gave no assessable income.

 

And indeed, even if you have assessable income, you break no law by not filing if you owe no tax (i.e. if your assessable income is below the threshold).

 

Historically that was the case but the Prayut government introduced an amendment that requires tax filing for employees, which should technically include pensioners, who have assessable over 120k pa. after deductions - less for non-employment income.  At the time the government said the requirement was to allow the government to identify and assist low income earners with reverse taxation, i.e. pay them welfare instead of taxing them. This was obviously BS as there have been no moves in this direction and the real motivation for processing millions of zero tax returns remains unclear.  Contrary to paying reverse tax to the needy, one of the last moves on welfare by the Prayut government was to axe the old age allowance of 600 to 1,000 a month depending on age.  Interior Minister General Anuphong said it was ridiculous for people like him with decent government pensions to receive the old age allowance and that welfare for the elderly should be on a selective means tested basis.  It was pointed out to the minster by journalists that he was actually ineligible for the old age allowance because he is in receipt of a government pension. So much for policy due diligence which I fear is also seriously lacking in this remittance tax initiative.

Edited May 13 by Dogmatix

[Mike Teavee]

1 hour ago, Dogmatix said:

This means that the average RD officer has little or know knowledge of Thai cap gains, let alone how they are treated in foreign tax jurisdictions or what tax credits they may qualify for for.

This maybe why the Expat Tax advisors have been saying that it's the Original Cost of the Asset that counts.

 

Doing a calculation that says Cost X, Realised Y, %Gain = (Y-X)/Y is very straight forward & repeatable irrespective of which country the asset is held in, trying to understand the different tapered reliefs of 60 different countries is not! 

 

 

 

Edited May 13 by Mike Teavee

[Fat is a type of crazy]

Based  on the Australian webinar from Dinga's post it seems:

• sending my superannuation pension paid as a former public servant to Thailand is not taxable as it is specifically excluded from the Double Tax Agreement;
•  if I keep an account separate in Australia that has savings from before I am a resident and send the funds to Thailand either before or when I am a resident that too is not taxable;
• income such as rental income  or superannuation paid from a normal non  government employer related superannuation fund  is not taxable as long as I don't transfer those funds to Thailand

Thanks Dinga for the helpful post. Writing it down in case someone thinks otherwise. I think I recall a retired public servant on this site saying their Government superannuation pension was taxed in Thailand but this suggests it is definitely not the case. 

[Mike Lister]

1 minute ago, Fat is a type of crazy said:

Based  on the Australian webinar from Dinga's post it seems:

• sending my superannuation pension paid as a former public servant to Thailand is not taxable as it is specifically excluded from the Double Tax Agreement;
•  if I keep an account separate in Australia that has savings from before I am a resident and send the funds to Thailand either before or when I am a resident that too is not taxable;
• income such as rental income  or superannuation paid from a normal non  government employer related superannuation fund  is not taxable as long as I don't transfer those funds to Thailand

Thanks Dinga for the helpful post. Writing it down in case someone thinks otherwise. I think I recall a retired public servant on this site saying their Government superannuation pension was taxed in Thailand but this suggests it is definitely not the case. 

Good to see there's another government pension that won't be taxed under dta rules, thanks for confirming 

[gamb00ler]

1 hour ago, Mike Teavee said:

Think about it, you are not bringing the Asset over to Sell, you're remitting the proceeds of selling that Asset so the Gains are calculated according to the rules of the country of the Asset (If for no other reason than you could have a tax obligation in that country)

I can definitely think of instances where this statement is not true.  I don't want to go into details but how capital gains are calculated for residential rental properties in the USA would make the heads of TRD staff spin.  I think it very likely that TRD would want to use a much simpler method to determine capital gains.

[Tony M]

2 hours ago, Mike Lister said:

If you haven't already done so, please read the document linked below.

 

You only need to file a tax return, if you are tax resident AND if you have assessible income either above the threshold or such that you have to pay tax (you must decide whether to file or not in the case of the former.

 

If your remittances are from savings earned before 1 January 2024, those funds are exempt.

 

You do not need to submit evidence of anything until asked, same as in your home country.

 

 

Again, many thanks, Mike.

[stat]

3 hours ago, Mike Teavee said:

 

Think about it, you are not bringing the Asset over to Sell, you're remitting the proceeds of selling that Asset so the Gains are calculated according to the rules of the country of the Asset (If for no other reason than you could have a tax obligation in that country) E.g. if I'm resident in the UK & sell some shares on the DAX, I don't apply UK rules to calculate CGT, I apply German rules & then declare the net Gain to UK RD when I remit the monies.

 

Countries can tax that Gain at whatever rate they feel is appropriate & they can argue that you've got the calculation wrong, but they would have to do so by running through the CGT rules of the country of the Asset, and besides even if Thailand could use it's own calculation, it doesn't have any as it treats remitted Gains as Income Tax. 

 

Capital gains

Most types of capital gains are taxable as ordinary income. However, the following capital gains are exempt from tax:

• Capital gains on the sale of shares in a company listed on the Stock Exchange of Thailand, provided that the sale is made on the Stock Exchange of Thailand, and on the sale of investment units in a mutual fund.
• Gains on the sale of non-interest bearing debentures, bills, or debt instruments issued by a corporate entity, except in the case where the bonds or debt instruments were sold for the first time at a price lower than their redemption price to an individual.
• Gains on the sale of securities listed on stock exchanges in the Association of Southeast Asian Nations (ASEAN) member countries and traded through the ASEAN Link, excluding securities in the form of treasury bills, bonds, bills, or debentures.

 

 

https://taxsummaries.pwc.com/thailand/individual/income-determination

 

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

 

However, having said all that out loud (or rather Typed it loudly 🙂), if we are following the rules of the country of the Asset then surely Taper relief must come into it, but Expat Tax videos I've seen say that it's the Original Cost of the Asset that's used. 

 

If I were calculating the CGT on some UK shares, I'd use a standard UK CGT calculator which would include Taper Relief & have the documentation to back up my rationale for why I came to the number I did, Worse case would be TRD re-calculate it without the Taper Relief. 

CGT arises in the tax residence country of the individual! If you have sole residence in TH then TH CGT rules apply (some exceptions maybe for real estate i.e. house in the UK immovable object you could be liable for UK CGT I frankly do not know, no CGT in this case for a german house if I live in TH). For share transactions like you mentioned i.e. you sold  german shares then no German CGT tax is applied if you are not a resident of Germany! I have been buying and selling US and UK shares my whole life without ever paying CGT in the US or UK nor have I ever seen a client that paid CGT on shares without a tax residence (exception maybe US guys that live abroad as the US taxes the ww income for its citizens even if they are not linving in the US).

 

Maybe explain what made you think that you had to use the CGT rule of the asset home country?

 

NB: I work as a consultant in the international tax industry

Edited May 13 by stat

[JohnnyBD]

This Capital Gains thing is making my head spin. If anyone would like to offer their thoughts on some examples below, it would be greatly appreciated. Assume you are a tax resident for all years. See below:

 

1. If you sold stock or property (owned more than 10 years) in 2024, but didn't remit any of it in 2024. You reported the sale, and paid taxes on the gains on your home country tax return for 2024. Then, in a future year, you remit those monies. Assessable or not? Or, would just the gains you paid tax on in an earlier year be assessable income?

 

2. Same situation above, but you didn't have any gains. You reported the sale on your home country 2024 tax return, but no taxes were due, because you had no gains. Then, in a future year, you remit those monies. Assessable or not?

 

3. You have $100k in savings (pre-2024 monies) earning interest monthly, and you transfer the interest out each month and spend it, leaving the original $100k in the account to continue earning interest. Then, in a future year, you remit the $100k. Assessable or not?

 

Thanks for offering your thoughts.

Edited May 13 by JohnnyBD

[stat]

2 hours ago, Dogmatix said:

 

Most of the DTAs I have seen allow the country of residence to tax all pensions including home country state pensions (with the exemption of government pensions paid to former government employees).  The only one I have seen that doesn't allow general state pensions to be taxed in the country of residence is the US treaty.  Someone posted that the Dutch treaty says state pensions "shall" be taxed in Holland, which may be true but I haven't looked it up to verify this.  Many people get confused with the DTA wording that says "may be taxed" in the country of origin and believe this means that the country of origin has the sole right to the tax.  This is only true if the wording is "shall be taxed", as in the US treaty vis a vis Social Security, rather than "may be taxed".  That means that Thailand has the option to tax foreign state pensions or not and the RD has already declared its intention to tax all pensions that it can (subject to DTA tax credits).  This was affirmed in the Swiss embassy interview.  Of course, since nothing has been written down, there could easily be a Thai flip flop, when they understand the cost and trouble of collecting paltry amounts of tax from expat pensioners who are unable to do their own tax returns.

Fully agree. On a sidenote Thailand has the right to tax german state pensions but never (at least to my knowledge) used that right for whatever reason. Germans are happy because they neither pay tax in GER nor in TH. Germany assumes that TH uses its rights but does not verify or ask.

[stat]

28 minutes ago, JohnnyBD said:

This Capital Gains thing is making my head spin. If anyone would like to offer their thoughts on some examples below, it would be greatly appreciated. Assume you are a tax resident for all years. See below:

 

1. If you sold stock or property (owned more than 10 years) in 2024, but didn't remit any of it in 2024. You reported the sale, and paid taxes on the gains on your home country tax return for 2024. Then, in a future year, you remit those monies. Assessable or not? Or, would just the gains you paid tax on in an earlier year be assessable income?

 

2. Same situation above, but you didn't have any gains. You reported the sale on your home country 2024 tax return, but no taxes were due, because you had no gains. Then, in a future year, you remit those monies. Assessable or not?

 

3. You have $100k in savings (pre-2024 monies) earning interest monthly, and you transfer the interest out each month and spend it, leaving the original $100k in the account to continue earning interest. Then, in a future year, you remit the $100k. Assessable or not?

 

Thanks for offering your thoughts.

Tax resident where: in TH only, or double residence?

 

My gut feeling:

 

1. No Thai CGT as you paid taxes in your home country not assesable

2.No Thai CGT not assesable

3. We will see maybe not assesable

 

This all is heavly dependant if Thai RD accepts your documents. In case they do not, you have to pay tax.

Edited May 13 by stat

[JohnnyBD]

9 minutes ago, stat said:

Tax resident where: in TH only, or double residence?

 

My gut feeling:

 

1. No Thai CGT as you paid taxes in your home country not assesable

2.No Thai CGT not assesable

3. We will see maybe not assesable

 

This all is heavly dependant if Thai RD accepts your documents. In case they do not, you have to pay tax.

Sorry forgot to mention. Tax resident in Thailand, but I am a US citizen, so I have to file and pay taxes in the US. All my income is US sourced income.

[Mike Teavee]

1 hour ago, stat said:

CGT arises in the tax residence country of the individual! If you have sole residence in TH then TH CGT rules apply (some exceptions maybe for real estate i.e. house in the UK immovable object you could be liable for UK CGT I frankly do not know, no CGT in this case for a german house if I live in TH). For share transactions like you mentioned i.e. you sold  german shares then no German CGT tax is applied if you are not a resident of Germany! I have been buying and selling US and UK shares my whole life without ever paying CGT in the US or UK nor have I ever seen a client that paid CGT on shares without a tax residence (exception maybe US guys that live abroad as the US taxes the ww income for its citizens even if they are not linving in the US).

 

Maybe explain what made you think that you had to use the CGT rule of the asset home country?

 

NB: I work as a consultant in the international tax industry

 

I get my UK CGT knowledge from actually writing the code for the UK's largest Stockbroker that calculated it for Bed & Breakfasting & the code that was used to produce annual CTC certificates, but that was pre the 1998 changes so admit things have changed since then, however how you calculate a Gain hasn't, perhaps you could share an alternative way of calculating the gain than the one I listed. 

 

 

Would also be interested in learning about any countries that use FIFO for doing (normal) Gains calculations & anything at all about how Thailand calculates CGT, from the Tax videos that I've seen it's on you to calculate the Gain and on your return apply that percentage to what you've remitted when listing your assessable  tax - If you're not going to do it using the rules of the country that the Asset is in & the country you are resident in doesn't have any rules, what rules would you suggest should be used?

 

 

I can't find the one that went into the calculation in more details but it's briefly covered in this one...

 

  

 

 

 

Edited May 13 by Mike Teavee