Calls for clarification of new Tax regime which appears to target expat foreign income sources

[Marco51]

3 hours ago, pluto_manibo said:

The article is a bit misleading and xenophobic. The law is not only aimed at foreigners, all the Thai people who work abroad, invest abroad and want to remit funds, trying to survive in this difficult economic climate are the main targets. Unfortunately, foreigners are caught within the net. The majority of Thai people are not concerned about this law, their income is domestic, falls below the "heavy Tax " brackets or as most is not declared(numbers hover around 10% of population paying taxes). The foreign elements on fixed incomes/pensions seem to feel sheltered by the DTA(Double Tax Agreement) they might have and most fall to under the category of the heavier tax brackets. However, what the higher ups have not considered is that there is a whole economy reliant on these foreign remitted incomes which have been repatriated under the full structure of the law(income remitted not within the same year earned is not taxable, not a loophole!).

To impose such drastic changes, while the world is still suffering from important inflation, market volatility, declining investment possibilities, repercussions of the "Epidemic", loss of confidence in the economic, political climate and societal views; will not inspire confidence in the future. Neither will it induce spending! Some might fall in the ranks, complain and just accept it. However, many will look for greener pastures, value for money, more stable environments and better investments abroad. It will destroy families, communities which have developed an ecosystem from these remitted incomes, which outweighs by far any of the perceived benefits of future taxation of these foreign injected funds.

 

This would be the first government and bunch of politicians that are actually interested in who they so frequently quote "the people of this country (put in country of your choice)....". Politicians live on a different planet than the rest of "the people" , have their own interest at heart and mind and even if they waste a rare thought on  the wellbeing of "the people...." they almost always get it wrong. When you and I say we have no money, we mean we have no money. When they say that , they simply forgot to go to the ATM which has been filled by "the people". Taxes are neccessary, also for the peoples' public service if there is any that deserves the name, but the major tax revenue of almost all governments is not from the corporates and superrich but from "the people" who work their arses off , the middle class and small businesses who cannot dodge and in case some politician decides to hand out an election promise  is always first of all gathered again right there. Often called equalisation, meaning they will shave everybody except themselves and their buddies the same way. So remember : public service is paid by the majority and belongs to them, the rich do not contribute or if, then disproportionately, neither do the corporates,  part of their job description is "avoid taxes at any cost, create more shareholder value". This  not even calculating that a majority of revenue is thrown out the window, gets into pockets that have not raised a finger to earn it or or or......rarely into public services except a blown out of proportion bureaucratic apparatus.  Anyone ever watched "Yes, Minister" on BBC years ago? This is not a Thai invention, ladies and gentlemen, they are sofar not even good at it.

To make it short, find out details (which they themselves have not thought through yet, I am sure) , find out which part -not which rumour- really concerns you, definitely find out how this will be implemented (via your yearly tax declaration if you file one) or deducted directly by your local bank as is the 10% on the massive interest on your savings accounts. If they actually do tax pensions and deduct : RUN FAST! I wonder if they also want a share in the 400- or 800thousand in accounts for visas or are Thai savings accounts exempt? After all they do not gather interest . And last not least : yes , very much so : this is not in the first place targeting us Farang who have been living here for decades, employing people, paying taxes and envelopes , spending all their income here on sometimes things we would have for free "at home" e.g. education of our kids, but this is aimed at everybody , at least the less cash endowed and the hard working who have a few bucks stashed away abroad although officially it looks as if it targets rich people with income from real estate, companies, accounts abroad. Poppycock, if you have tons of printed paper you can put it in places and call it foundations or other fantastic names and become a cash card carrier with no limit or even have everything run via the company here. The guys with the glue on their seats will see to it your interest is the interest of "the people" .

[Walker88]

41 minutes ago, LikeItHot said:

The same way they enforce murder.  They make a law.  Banks accounts in Thailand require a W9 filing in the US at least.  I wouldn't put it past the US to reciprocate.  It's common among countries with tax treaties.  The difference between murder and tax evasion is the penalties for tax evasion are higher.

The only way the US would reciprocate is if trump won again and wanted to build a tower on Sukhumvit.

 

The US is not going to supply Thailand with capital gains data, TBill income, dividends, etc.

[The Theory]

It seems PM new advisor working hard on foreigners. This is the beginning of treatment of foreigners new policy. What a desperate government. All Chinese tourists wishes were just a dream.

[Surasak]

38 minutes ago, Moonlover said:

Oh for heaven's sake, here we go again!

 

From the original article and for the umpteenth time:

 

'The program will begin January 1, 2024 and apply only to tax residents in Thailand meaning tourists and short term workers will be exempt. Also exempt will be those who have been taxed in a foreign country that has a standing Double Tax Agreement with Thailand'.

 

What could be clearer than that?

 

Thai government to tax all income from abroad for tax residents starting 2024 - Thai Enquirer Main News

I notice you didn't include the last line of the above, which reads as.....It is unclear at this point how this will apply to foreigners living in Thailand on a retirement visa.

[Bangkok Barry]

6 hours ago, webfact said:

it planned to tax foreign income on all individuals in the kingdom who have been resident in the country for over 180 days.

One thing they need to clarify is who is a 'resident'. Few of us are residents in the eyes of immigration and therefore the government, but short-term stayers who require a visa and must report ourselves to the authorities every 90 days. In the eyes of TAT, also part of the government, every foreigner who enters the country is a tourist, so there are no foreign residents.

[The Theory]

6 hours ago, webfact said:

The tax change which has already been defended by Prime Minister Srettha Thavisin

If they ask for tax they should give us same service as Thai. Free hospital services as well as no charge for anything that foreign pay now(or dual rates). 

[crazykopite]

Time to move on I’ve been saying it for a number of years and although I have lived here for 18+ years my pensions which are several are taxed at source in the U.K. I have always favoured the Philippines where my OAP would be unfrozen giving me an extra £35 per week . The house I own here could be rented out long term as it’s on the beach or worse still I would just pull the shutters down and live between both countries 

[edwinchester]

Tax on an income of 400k bht, married man's extension, is 17,500 bht per year. Wonder if they'll throw in free Govt Healthcare and a Thai pension as benefit's?

[Moonlover]

7 minutes ago, Surasak said:

I notice you didn't include the last line of the above, which reads as.....It is unclear at this point how this will apply to foreigners living in Thailand on a retirement visa.

The great majority of us don't live here on retirement visas. We live on yearly extensions.

[sirineou]

10 minutes ago, bob smith said:

these were my initial thoughts when the story first broke.  

 

It remains my gut feeling but as nothing has either been confirmed or denied as of yet then we will have to wait and see.

 

Personally, I don't even think this plan will get off the ground, let alone make a maiden flight.

Though , if I understands this correctly. this is where it becomes interesting.

"a) Any pension paid by, or out of funds created by, a Contracting State or political subdivision or a local authority thereof to an individual in respect of services rendered to that State or subdivision or authority shall be taxable only in that State. b) However, such pension shall be taxable only in the other Contracting State if the individual is a resident of, and a national of, that other State. "

So if the Thai goverment wanted to get at foreign pensions , extensions to stay could be replaced with a residency program. Such residency program could be structured in such a way that it would still attract retirees to Thailand . Greece  Canary Islands, Portugal, Cyprus, Croatia and a number of other countries  have similar tax schemes for retirees.

Depending on the benefits if such a Thai system provides, if adapted  , it might not be a bad thing.

This is just speculation on my part, We have to wait and see.  

[crazykopite]

2 hours ago, Thailand J said:

Beautiful countries with no extra charge, no paved road, no traffic lights, no running water.

Come live on one of the islands it’s not unusual for the government water to be switched off from 8 am until 5 pm 

[khunjeff]

6 minutes ago, sirineou said:

However, such pension shall be taxable only in the other Contracting State if the individual is a resident of, and a national of, that other State. "

So if the Thai goverment wanted to get at foreign pensions , extensions to stay could be replaced with a residency program.

You missed the part that says "and a national of...".

 

This clause was written to cover, for example, a Thai who lived and worked in a foreign country long enough to qualify for a pension, and then moved back to Thailand for retirement. It doesn't apply to citizens of that same foreign country who retire in Thailand.

[retarius]

Some clear, concise and accurate communications from the government would be appreciated. Unfortunately the communications they send out (in explicably poor language) begs so many questions that the initial report is not worth reading.  

[MikeN]

3 hours ago, Nabbiex said:

Out of curiosity,

if we, expats, may be taxed, then will we be entitled to receive any Thai benefits such as Thai state pension, Thai personal tax income, family benefits, disability allowance, and so forth?

Of course not, you are still white.... and don't expect to get into National parks cheaper either!

 

If expat retirees did get Thai prices for park admission etc then the govt would lose about as much money as it gains from taxing our pensions.

[retarius]

1 minute ago, khunjeff said:

You missed the part that says "and a national of...".

 

This clause was written to cover, for example, a Thai who lived and worked in a foreign country long enough to qualify for a pension, and then moved back to Thailand for retirement. It doesn't apply to citizens of that same foreign country who retire in Thailand.

I am US citizen and have a US pension paid over here. There is a tax treaty to avoid double taxation. Having Thailand as my tax home does not have any advantages because the US only allows you to write of taxes paid here in the US to the extent that tax rates are lower.....ie over the two filings you would pay exactly the same. So to make things easier and to avoid double filings, I have the US as my tax home. Things are starting to look ugly perhaps, when we talk about transferring private pensions paid in the US or savings from eg 401K plans. I have used the strategy of filing in the US and paying US rates as they are higher (marginal rate ~ 50% including state taxes) than in the 35% on incomes over 4 million baht per year here in Thailand.

If this is a trick to double tax foreigners, I will leave and go to somewhere that doesn't hate white people so much.

[BenStark]

2 hours ago, newnative said:

    I'm confused as to how Thailand would, (a.)  know what my capital gains/dividend income for the year was and, (b.) know that any of that income was sent to Thailand.   I get income from a USA state pension, social security, and capital gains/dividend money.  When I send, say, $3,000 to Thailand, how is Thailand going to know if that $3,000 is from already taxed pension/social security or from dividends/capital gains?  It all goes into my USA bank account and I wouldn't even know myself if this or that dollar was a dividend dollar or a pension dollar.  

How they would know?

 

Well they can do same as some of the western countries do.

 

I know of an acquittance living here since he retired from work, and receiving his pension.

 

Last year he received a huge tax bill from his government, unless he could prove that he didn't have any income in Thailand. The guy in question is in his seventies, is married, and has never worked in Thailand.

 

So they simply put the burden of proof on the taxpayer.

[lordgrinz]

If they want to tax us, they should remove all the fund requirements for staying here also. Why should we keep 400,000-800,000 in a Thai bank making nothing for interest? If they can indeed see worldwide income, then that income abroad should count, not just incoming or banked amounts. 

[Drumbuie]

https://www.gov.uk/government/publications/thailand-tax-treaties

 

If you'd like to gen up on the current UK/Thailand double taxation agreement, here it is. I haven't read it yet but suspect it cannot be unilaterally altered. 

[foreverlomsak]

6 hours ago, StayinThailand2much said:

Not to worry, Thailand is aiming for some of what's left of your, already taxed, income...

I understand that the US already taxes it's citizens on all worldwide income, maybe Thailand want to do the same with all Tax Residents, Thai and Foreign, they do not have the resources or the clout to tax Thai's in foreign countries on their incomes there.

[PB172111]

4 hours ago, BE88 said:

Definitely leaving Thailand is my option as a classified Thai rich taxpayer, all my remittances will no longer enter Thailand from next month and consequently my bank accounts in Thailand will go to zero.

Very intelligent of you to ensure all the people are aware of your intentions ????

[Darren8888]

4 hours ago, Thailand J said:

For US retirees, the tax treaty exempts SS and pension incomes but it does not  help with capital gain (CG) and dividend incomes.

 

Based on my limited knowledge I made a table below, I am sure it's full of mistakes and it is over simplified, but the idea is that if you have CG and dividends from US and if Thai gov decided to tax them, you can only deduct taxes paid in US.

 

I am going to get insurance and apply for 10 yr LTR if I have to pay income tax  here. I have met other requirements.

Nice work. So this meant having a small income of just $80k a year, you only be paying about $3.5k tax in the US. In Thailand, you pay $17k tax. That is 5 times larger. Thailand tax is too expensive

[Moonlover]

18 minutes ago, Drumbuie said:

https://www.gov.uk/government/publications/thailand-tax-treaties

 

If you'd like to gen up on the current UK/Thailand double taxation agreement, here it is. I haven't read it yet but suspect it cannot be unilaterally altered. 

38 pages of legalize! I'm not surprised you haven't read it yet. Here's a much simply version for your perusal.

 

https://thailand.acclime.com/guides/double-taxation/

[wwest5829]

3 hours ago, Isaan sailor said:

That would depend on where those capital gains and dividends came from.  In the US, money in a Roth IRA came from after tax investments.  And money in a traditional IRA is tax deferred—Uncle Sam will assess the tax—not Thailand.  The long arm of the IRS reaches American expats.  If they tax us—they need to protect us from double taxation.

My current thinking, based on my current understanding is that the current tax treaty between the USA and the Kingdom of Thailand protects citizens of both nations from double taxation. As the USA requires Americans pay income taxes from all global sources, I am exempt from having to pay income tax on that income again in Thailand. The current proposal would immediately bring in diplomatic actions breaching the existing treaty (ies). Sooo ... currently I will read, listen but not raise my blood pressure over this proposal.

[BE88]

18 minutes ago, PB172111 said:

Very intelligent of you to ensure all the people are aware of your intentions ????

I am in a position to say it and do it, this is how I intend to be free.

Who cares about the Thai government?

[JimboB4]

“On September 15th, the Revenue Department in Thailand issued a clarification stating that from the 1st of January 2024, it planned to tax foreign income on all individuals in the kingdom who have been resident in the country for over 180 days.” Ok so sounds like it actually means permanent foreign residents but double speak to scare readers? Am I right about that? That’s about the norm when reading TVF. This is only for those foreigners already paying taxes correct? If you don’t currently file income tax in Thailand this shouldn’t affect you correct? 

[JimboB4]

Bottom line this doesn’t affect you if you’re on a marriage visa and all of your income is from overseas right? My income isn’t even taxable in the US. I wish Ubonjoe was still here to clarify the nonsense. In the past you read BS on here and just ask him about it and he would totally clear it up. 

[redwood1]

14 minutes ago, JimboB4 said:

“On September 15th, the Revenue Department in Thailand issued a clarification stating that from the 1st of January 2024, it planned to tax foreign income on all individuals in the kingdom who have been resident in the country for over 180 days.” Ok so sounds like it actually means permanent foreign residents but double speak to scare readers? Am I right about that? That’s about the norm when reading TVF. This is only for those foreigners already paying taxes correct? If you don’t currently file income tax in Thailand this shouldn’t affect you correct? 

Sir the answer is........f3f65yyt65rrgf...........Well thats about of good of a answer as your going to get right now from Thai officals....

 

Whats really funny is the one year visas all say NON-IMMIGRANT VISA............Or your not a resident of Thailand...lol    The tax boys must just hate this..

Edited September 26, 2023 by redwood1

[John Drake]

4 hours ago, daveAustin said:

The rich so & so has only been in office 5 minutes and already hate him with a passion. Bring back Phrayut! ????

I've been saying this since right before the election. PTP is anti Western. Prayuth just wanted to keep the old system going, where everybody knew the rules of graft and could suck out their "fair share." New guy is going to hoard it all for himself. and cronies and invent new ways to grab more. I think he's making lots of enemies, especially among Thai big shots that count. This tax measure will be walked back.

[paddypower]

another Thai habit is to shoot yourself in the foot 555

[paddypower]

3 hours ago, stix40 said:

How about a permanent channel opened on aseannow for future debating ! Amongst users.

is there a page limit?