Why foreigners should not be worried by the new modification to the revenue code in Thailand

[TroubleandGrumpy]

Just now, freeworld said:

Oh my goodness, how did racial discrimination enter the conversation.

Many Thais do not submit tax returns because many are exempted by their tax threshold.

The rule is very clear.   But obviously they do not currently enforce that rule for Thais andnon-working Expats.

 

Personal Income Tax (PIT) is a direct tax levied on income of a person. A person means an individual, an ordinary partnership, a non-juristic body of person and an undivided estate. In general, a person liable to PIT has to compute his tax liability, file tax return and pay tax, if any, accordingly on a calendar year basis.

Personal Income Tax | The Revenue Department (English Site) (rd.go.th)

[FritsSikkink]

2 minutes ago, TroubleandGrumpy said:

The rule is very clear.   But obviously they do not currently enforce that rule for Thais andnon-working Expats.

 

Personal Income Tax (PIT) is a direct tax levied on income of a person. A person means an individual, an ordinary partnership, a non-juristic body of person and an undivided estate. In general, a person liable to PIT has to compute his tax liability, file tax return and pay tax, if any, accordingly on a calendar year basis.

Personal Income Tax | The Revenue Department (English Site) (rd.go.th)

Like in other countries, there are people working who are not on the payroll. Which means no tax and Social Security being paid.

[PJ71]

14 minutes ago, FritsSikkink said:

Because when you are a tax resident, you need to declare income, doesn't matter where you keep the money.

To be 'tax resident' i assume you need to be on a WP?

[sirineou]

The article has a lot of could and might.

Having read the tax agreement between the US and Thailand, I am pretty sure  I would not have to pay tax on my pensions and annuity income but implementation of the tax law will create another layer of bureaucracy to the already complex process of immigration. 

I am sure we will have to hire an accountant, at least until we figure this thing out. 

Even though I have other options ,part of the reason I am in Thailand is because for me at this point it is easy.

 I already have my house here, by now have it the way I want it, my car, I transfer enough money every month to live conformable, and I do a yearly extension to stay. Who wants to be starting in another country at this stage of my life.

So let's see how easy it remains. and whether it is worth the trouble.  

[FritsSikkink]

4 minutes ago, PJ71 said:

To be 'tax resident' i assume you need to be on a WP?

No, stay in a country more than 180 days per year.

[oxo1947]

1 hour ago, liddelljohn said:

none of it will affect me  so not worried

Do you want to elaborate John---it might help us all......or some........

[david555]

Never mind about the nice reassuring from Thai Law Online (orig. poster )

You have now to declare .....and after to pay or not to pay ...., meaning you have to surrender (with or whiteout white flag ????)...., and ???? open your money situation with outcome later ????...

 

I am no longer a Tax resident from 1 Sept 2021 , ......just becoming a SilverSnowbird  now

 

PS:

Remember  Al Capone .... FBI could not make him & his crimes  nothing .... but tax office IRS. locked him up

[foreverlomsak]

14 minutes ago, Pattaya57 said:

I make property rent, bank interest and shares income in Australia. No way will I be telling Thailand Tax office of this income like the OP says to do as how would they ever know? No chance!

To an extent, provided it is earned legally, they don't give damn where it comes from they want to assess it for potential tax when you bring it into the country, note assess not necessarily tax it.

 

How would they know - it's quite simple the banks will be required to notify the Thai Tax Office when money from foreign sources arrive and whose account they are credited to.

[zombie nights]

53 minutes ago, freeworld said:

It does not matter what visa you have, it is tax residence which matters with tax. 180 days and more residing in Thailand one is tax resident.

OP: you have not mentioned that with Thai Elite...are they exempt?

 

 

[aldriglikvid]

36 minutes ago, TroubleandGrumpy said:

The problem is that they might/can look at your money transfers into Thailand.  How they look at those bank transfers is unknown - in the past they just let it go.  Anyone bringing in a large amount of money after Jan 1 2024 is now under the threat of being 'looked at' and then asked where did those funds come from - and then to prove it was not taxable income. 

You really got to let this go, the idea that the Thai government is able to "look at your account" and "track your transfers". They can't. 

 

Thai banks, just as OECD banks, have bank secrecy laws and there's no everyday tracking. If this would be implemented, it would be huge news - in a country of 80 million and a very substantial international community. Won't happen. 

 

Here's how CRS/Fatca works: 

 

- Year of end balance, dividends and capital gains are shared in batch to country of nationality: not to all +110 countries that have signed up for CRS. Meaning, if a Thai national opens an account in Poland, the Polish bank will ask for passport and thus nationality. That Polish bank is then obliged to send Thai RD the aforementioned data, once per year. Here's an important rule: Thailand is not obliged to send Poland info as per standard, and Poland does not send all +110 CRS countries info. 

Besides CRS/Fatca all banks follow Tax Evasion and Terrorist Finance laws which means that large incoming transfers that the client is unable to properly explain, is then sent as a notification to the local tax agency for further investigation. Can they request transfer info if they see criminal liability? Sure, but mass surveillance of 15 million international expats is not qualifying. 

 

Please stop with the "Thailand see your money transfers" nonsense. They don't. 
 

Edited October 2, 2023 by aldriglikvid

[david555]

9 minutes ago, zombie nights said:

OP: you have not mentioned that with Thai Elite...are they exempt?

 

 

You think they go let that big money coming in to Thailand not taxed ....?? ????

 

Maybe not ...., but you shall only know after the obligation declaring it......

Edited October 2, 2023 by david555

[freeworld]

35 minutes ago, FritsSikkink said:

Because when you are a tax resident, you need to declare income, doesn't matter where you keep the money.

Please now that is making stuff up.

 

IF it is remitted (ie brought into Thailand). If it is not remitted it does not have to be reported.

Edited October 2, 2023 by freeworld

[NoDisplayName]

1 hour ago, freeworld said:

Why would the foreigner need to report the income from a foreign rental property if they do not bring the income to Thailand?

For the same reason Americans (and I suppose anyone with tax residence in the good old USA) have to claim foreign income on their American taxes, whether or not they brought said funds into the USA.

 

Thailand is following the US example, claiming sovereignty over all global income.

[zombie nights]

1 hour ago, freeworld said:

It does not matter what visa you have, it is tax residence which matters with tax. 180 days and more residing in Thailand one is tax resident.

Completely wrong!

For decades those with retirement visas and subject to double taxation have not been required to pay tax here even though they stay here in Thailand  more than 180 days per year.. The revenue dept has this as normal practice if not the law.

Ask any retired person in Thailand.

Or read all the links that confirm retiress are exempted or excused from tax here by general consensus of the revenue dept.

The fact that some retirees on retirement visas choose to pay tax is through their own generosity to put it kindly .....

Edited October 2, 2023 by zombie nights

[ukrules]

47 minutes ago, RupertIII said:

Section 2: Any regulations, rules, orders, letters in response to inquiries, or practices that are inconsistent with this order shall be repealed.

So they're going to repeal that act of parliament from the 80's which contradicts this new memo?

 

Good luck with that ????

[dingdongrb]

All my $$ is in US banks except the 800k+ I keep in BKK Bank for my extension requirement.

 

I pull THB from ATMs from my US banks.

 

How would I be affected? How would the Thai government know that I'm considered a 'tax resident' instead of a frequent tourist?

 

I think that could only occur if they somehow had a database which connected Immigration info with ATM usage and bank info from those ATM users.

 

Thailand can't even connect vehicle tax info, vehicle insurance info, and MV (motor vehicle) violation data.

 

 

[bob smith]

40 minutes ago, atpeace said:

Tax residency's definition is country specific.  This new regulation probably has nothing to do with Expats retiring in  Thailand.  It probably has nothing to do with Thais that reside overseas as long as they aren't tax residents and this is why the reg stipulates tax residents.   Thais that aren't tax residents will not pay taxes when remitting money from abroad.  Same types of tax regs apply in Finland in regards to tax residents and many other countries.

 

The purpose of this reg is to  to tax Thais that are tax residents that have foreign investments, property, and income.  The odds of this having anything to do with 99% of Expats residing in Thailand is miniscule.   The implementation of taxing foreign transfers to foreigners would be interesting and I would venture to say impossible to implement.   

 

 

my sentiments exactly.

 

and how it would affect visa extensions going forward would also be another very contentious issue and add a mountain of red tape to an already arduous process.

 

the whole thing will fall flat on its face before it even gets off the ground.

Edited October 2, 2023 by bob smith

[TroubleandGrumpy]

7 minutes ago, aldriglikvid said:

You really got to let this go, the idea that the Thai government is able to "look at your account" and "track your transfers". They can't. 

Thai banks, just as OECD banks, have bank secrecy laws and there's no everyday tracking. If this would be implemented, it would be huge news - in a country of 80 million and a very substantial international community. Won't happen. 

Here's how CRS/Fatca works: 

- Year of end balance, dividends and capital gains are shared in batch to country of nationality: not to all +110 countries that have signed up for CRS. Meaning, if a Thai national opens an account in Poland, the Polish bank will ask for passport and thus nationality. That Polish bank is then obliged to send Thai RD the aforementioned data, once per year. Here's an important rule: Thailand is not obliged to send Poland info as per standard, and Poland does not send all +110 CRS countries info. 
Besides CRS/Fatca all banks follow Tax Evasion and Terrorist Finance laws which means that large incoming transfers that the client is unable to properly explain, is then sent as a notification to the local tax agency for further investigation. Can they request transfer info if they see criminal liability? Sure, but mass surveillance of 15 million international expats is not qualifying. 

Please stop with the "Thailand see your money transfers" nonsense. They don't. 

You are both right and wrong.  Yes it is a difficult situation without due cause for RD to get that information.

But no, the Thai RD can request your bank deposits - it is not nonsense.  Under the international rules brought in after 9/11 and changed/added since then, banking organisations must report transactions over a certain amount and of a certain type to authorities.  Thailand is part of that international agreement.

 

Will/can taxation authorities be able to also see that information if thwey want to for reasons of investigating any possible tax avoidence - Yes.   Do you really think the Thai RD (or any Tax Dept) cannot see your bank account details if they wanted to - of course they can.

 

Obviously they will not be 'seeing' all of them as a matter of course - but if they want to they can saee any one's bank details that they want.  May I suggest going forward all Expats keep their remittances into Thailand below about the equivalent of 10K USD at one time?  May I also suggest that Expats have 2 bank accounts so as to limit the total brough into Thailand in any one bank? Hope that does not sound like nonsense - but either way - it is up to you. 

[bkk6060]

I never was worried. But, if some of you are pay the tax I am sure Thailand will gladly accept your money.

Edited October 2, 2023 by bkk6060

[TroubleandGrumpy]

17 minutes ago, zombie nights said:

Completely wrong!

For decades those with retirement visas and subject to double taxation have not been required to pay tax here even though they stay here in Thailand  more than 180 days per year.. The revenue dept has this as normal practice if not the law.

Ask any retired person in Thailand.

Or read all the links that confirm retiress are exempted or excused from tax here by general consensus of the revenue dept.

The fact that some retirees on retirement visas choose to pay tax is through their own generosity to put it kindly .....

You are wrong as to what constitutes a 'tax resident' in Thailand.  If you can find somethinjg from the Thai RD that advises what you say - I will stand corrected.

I agree with you that they have previosuly not 'enforced' the matter for retired/married Expats. But how will they now enforce this new rule? Look at incoming bank transfers as indicated in the first OP about that matter? That is the problem - we dont know.

I would also point out that the Govt, the PM, the RDmn etc etc (none of them) have not released a statement in response to the massive social media backlash (Expats and also Thais) saying what you have stated (leave retired Expats alone) is current practice, and that going forward that will not change. 

Edited October 2, 2023 by TroubleandGrumpy

[TroubleandGrumpy]

10 minutes ago, dingdongrb said:

All my $$ is in US banks except the 800k+ I keep in BKK Bank for my extension requirement.

I pull THB from ATMs from my US banks.

How would I be affected? How would the Thai government know that I'm considered a 'tax resident' instead of a frequent tourist?

I think that could only occur if they somehow had a database which connected Immigration info with ATM usage and bank info from those ATM users.

Thailand can't even connect vehicle tax info, vehicle insurance info, and MV (motor vehicle) violation data.

 

IMO you are probably as 'safe' as anyone can be, if this goes ahead and the Thai RD cracks down on Expats brining money into Thailand banks.  Unfortunately. I am not in the same situation as you. 

[SingAPorn]

Even if not concerned, the falang retiree wlll have to file all kinds of documents from home country tax, new hassles and enter another spiral of Thai bureaucracy and the risk to bang into new rules invented by the tax clerk just like as in some immigration or DLT offices.

 

No thanks, Start looking around other foreigner friendly countries in Asia who will treat us farangs a bit better. Up to you if you want to spend all your retirement between immigration or now the tax office.

[freeworld]

10 minutes ago, zombie nights said:

OP: you have not mentioned that with Thai Elite...are they exempt?

 

 

I don't know, but I would think not unless there was a specific decree or revenue department order

 

But this below is from the Thai Elite Visa website which is in line with the RD tax code

 

If you stay in Thailand for 180 days or more in a tax year, any foreign income you bring into the country will be taxable. This includes money from jobs, businesses, or properties abroad. Starting January 1, 2024, any foreign income you bring to Thailand will be subject to tax.

If you’ve already paid tax on this income in the country where you earned it, Thailand might offer some tax relief. Thailand has agreements with some countries that might allow you to reduce your tax based on the tax you already paid elsewhere. It’s advisable to contact us for detailed guidance.

[dingdongrb]

1 minute ago, TroubleandGrumpy said:

IMO you are probably as 'safe' as anyone can be, if this goes ahead and the Thai RD cracks down on Expats brining money into Thailand banks.  Unfortunately. I am not in the same situation as you. 

Sure, I pay ATM fees but that equates to only about $20-30 USD a month (1k THB). Worthwhile (ease of mind) for me to do than having $$ in a Thai bank. Besides I'm able to play the USD vs. THB game to try and get the best value....  ????

 

Maybe it's me, but I think those that elect to have their pensions direct deposited into a Thai bank are crazy.

[freeworld]

"  19 minutes ago, zombie nights said:

Completely wrong!

For decades those with retirement visas and subject to double taxation have not been required to pay tax here even though they stay here in Thailand  more than 180 days per year.. The revenue dept has this as normal practice if not the law.

Ask any retired person in Thailand.

Or read all the links that confirm retiress are exempted or excused from tax here by general consensus of the revenue dept.

The fact that some retirees on retirement visas choose to pay tax is through their own generosity to put it kindly ....."

 

 

We are specifically referring to income received from renting out a property in a foreign country as stated in the OP article.

 

If that income is not brought into Thailand then it is not reportable income. If the income is brought into Thailand it must be reported.

[dingdongrb]

6 minutes ago, SingAPorn said:

Up to you if you want to spend all your retirement between immigration or now the tax office.

Immigration office time for me = Approximately 1-3 hours a year.......  Damn, that's a very long time.......  55555555555

[aldriglikvid]

6 minutes ago, TroubleandGrumpy said:

You are both right and wrong.  Yes it is a difficult situation without due cause for RD to get that information.

But no, the Thai RD can request your bank deposits - it is not nonsense.  Under the international rules brought in after 9/11 and changed/added since then, banking organisations must report transactions over a certain amount and of a certain type to authorities.  Thailand is part of that international agreement.

 

Will/can taxation authorities be able to also see that information if thwey want to for reasons of investigating any possible tax avoidence - Yes.   Do you really think the Thai RD (or any Tax Dept) cannot see your bank account details if they wanted to - of course they can.

 

Obviously they will not be 'seeing' all of them as a matter of course - but if they want to they can saee any one's bank details that they want.  May I suggest going forward all Expats keep their remittances into Thailand below about the equivalent of 10K USD at one time?  May I also suggest that Expats have 2 bank accounts so as to limit the total brough into Thailand in any one bank? Hope that does not sound like nonsense - but either way - it is up to you. 

I explained to you all the ways Thai authorities can see account transfers. If you then rehash all my points and try to make them your own, it comes off as somewhat dishonest way of having a discussion. Automatic disclosure of 15 million expats (Chinese, Korean, Japanese, American, UK, Norwegian, etc) account transfers is not happening, and will not happen. Keep in mind, it has been your outright position that this was the case - in several threads. 

 

I do work under these laws and regulations, and no - Thailand RD can't just see all account transfers even if they get an initial notification from a bank that a transfer is unexplained. It will require reasonable criminal liability, followed up by further manual requests. The idea that this will be used en masse (+15 million international accounts) for all transactions and then flat tax everyone is an almost nauseating level of fear mongering. 

 

 

[freeworld]

28 minutes ago, zombie nights said:

Completely wrong!

For decades those with retirement visas and subject to double taxation have not been required to pay tax here even though they stay here in Thailand  more than 180 days per year.. The revenue dept has this as normal practice if not the law.

Ask any retired person in Thailand.

Or read all the links that confirm retiress are exempted or excused from tax here by general consensus of the revenue dept.

The fact that some retirees on retirement visas choose to pay tax is through their own generosity to put it kindly .....

Read the tax code section 41, one is tax resident if one is 180 days (aggregated) or more living in Thailand.

 

I did not make that up.

 

Now there may have been specific article excluding the income when remitted but you are still tax resident.

[SingAPorn]

3 minutes ago, dingdongrb said:

Immigration office time for me = Approximately 1-3 hours a year.......  Damn, that's a very long time.......  55555555555

Was expecting some sort of answer like yours,  but you are not the only foreigner in Thailand, Many people all over Bangkok Hua Hin Phuket have terrible experiences and have to go back and forth with absurd document requests. If you like to waste your time doing going back and forth between immigration offices in your village, your embassy in Bangkok etc etc, no problem. 5555 and even 6666 if you please.

[freeworld]

1 hour ago, TroubleandGrumpy said:

The rule is very clear.   But obviously they do not currently enforce that rule for Thais andnon-working Expats.

 

Personal Income Tax (PIT) is a direct tax levied on income of a person. A person means an individual, an ordinary partnership, a non-juristic body of person and an undivided estate. In general, a person liable to PIT has to compute his tax liability, file tax return and pay tax, if any, accordingly on a calendar year basis.

Personal Income Tax | The Revenue Department (English Site) (rd.go.th)

Tax returns

All persons earning income are required to file a tax return no later than 31 March of the following year for hardcopy filing and 8 April for online filing, except for individuals whose income from employment is THB 120,000 or less (for single persons) or THB 220,000 or less (for married persons) and in the case of having income from other sources (with or without employment income) of THB 60,000 or less (for single persons) or THB 120,000 or less (for married persons).

Individuals engaged in most forms of business are also required to file a return of their income for the first six months of the year by 30 September and pay the tax due.

Each husband or wife earning income can choose to file their income tax return either separately or jointly with their spouse, whichever they prefer.