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

[dingdongrb]

2 hours ago, scorecard said:

You kindly gave some examples but missed the scenario which interests a very large % of the foreigners living full-time in Thailand. The folks who receive state pensions every month / 4 weeks from a foreign government. 

 

Some further scenarios on this item:

 

- State pensions  transmitted to the LOS from governments which have double taxation agreements with Thailand.

- State pensions from government who have declared that their state pensions are exempt from their local taxes. That doesn't of course mean automatcally the same pension funds are exempt from Thai personal taxes.

- State pension receipts and /or company pension schemes from past employment which are under the Thai personal tax threshhold. Will these folks have to register for a Thai tax number?

 

Perhaps you might like to respond. Thanks, I'm sure your comments will be appreciated by many foreigners living in the LOS.

 

As I asked and will question again, why even have pensions direct deposited into a Thai bank?

[scorecard]

16 minutes ago, dingdongrb said:

As I asked and will question again, why even have pensions direct deposited into a Thai bank?

Point taken but for some older folks it's very convenient and consistent and the pensioner doesn't need to instigate further actions.

[scorecard]

2 hours ago, Mavideol said:

majority of Expats are not residents of Thailand, we are merely guests with a temporary permit to say that can be removed/revoked/cancelled and kicked out at any time or will we now be considered residents and will be given residency cards

There's also lifetime Certificate of Residence holders (lifetime Permanent Residents). 

[dingdongrb]

8 minutes ago, scorecard said:

Point taken but for some older folks it's very convenient and consistent and the pensioner doesn't need to instigate further actions.

How is having your pension in your home country or another bank outside of Thailand inconvenient? 

 

Further (difficult) action? -Hmmmmm

 

1) Open new account

2) Contact current pension administrator and change deposit info

 

 

[gearbox]

6 hours ago, Neeranam said:

Exactly, I will be consulting a  Thai accountant, not a foreign lawyer. 

The OP has little idea what he is talking about. Consult the specific DTA with your country.

 

Most DTAs are structured so people get tax credit for tax already paid in a foreign country.

 

For example say the marginal tax rate in Australia is 45%, and in Thailand is 30%. If I earn interest 1000 baht in Thailand the Thai govt will tax me 300 baht (30%). When I file my tax return in Australia and declare income in Thailand of 1000 baht, the govt under the DTA between the two countries will give me a tax credit for tax already paid in Thailand of 300 baht, and will charge me extra 150 baht covering the difference to the 45% Australian tax rate.

 

If there was no DTA then both Thailand and Australia would charge me their respective rates, 30% in Thailand and full 45% in Australia.

 

I get regularly tax credits for tax withheld,  and get charged extra tax to cover the tax rate differences for income earned in New Zealand.

[freeworld]

1 hour ago, NoDisplayName said:

In some cases, they already do.

Your Thai broker credits your account for dividends, after deducting tax.

Your Thai bank credits your account for that splendifourous 0.5% interest, then deducts 15% tax.

 

"Only the shadow knows what evil lurks in the hearts of men."

Yes because those streams of income (Thai based dividends and Interest) are accrued in Thailand and they are known how to be treated according to the law.

[gearbox]

5 hours 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!

It all depends what information the two countries share. And this is not public info.

I've seen people who got issued tax return adjustment notices in Oz as a result of data matching with foreign governments wrt foreign income.

 

On the other end there is a tick box on the Oz tax return "do you have more than 50k assets overseas?", I know many people who have but never bothered to declare, nobody had any issues so far.

 

My strategy would be to declare nothing and minimise any bank transfers, let's see if either of the countries issue me a notice.

[freeworld]

1 hour ago, NoDisplayName said:

This is from the original announcement
 

It seems, from the article at least, that any money that "comes in" to Thailand will/may be considered as "in-come."

 

At this point, don't nobody know nuttin'.

Hope for the bestest, plan for the worstest.

Exactly, nothing is finalised.

 

Of course the transfers may be considered as income but it is only a transfer and deposit to the bank account, the bank and the tax people at this stage know nothing about the history of that money and there is no law or reason to tax it at transfer and deposit stage.

 

A tax, if any, will only depend on an interaction between the resident account holder and RD.

[gearbox]

3 hours ago, Mavideol said:

majority of Expats are not residents of Thailand, we are merely guests with a temporary permit to say that can be removed/revoked/cancelled and kicked out at any time or will we now be considered residents and will be given residency cards

This is not how it works, tax residence is separate from the usual concept of residence. I'm an Australian tax resident although I may spend as little as 1 week per year there, and by the looks of it I'm also a Thai tax resident if I stay more than half an year here. Different countries have different laws wrt tax residence.

[Ben Zioner]

5 minutes ago, freeworld said:

"in-come."

My  "come" goes the  other way around.

[atpeace]

4 hours ago, bob smith said:

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.

If Thai government officials or for that mater any Thai or lets go even further, any rational person is reading this thread, they are having a huge laugh at our expense.  

 

A high demand retirement destination that has made the process easy is going to make it the most difficult place to retire in the world. Fear sure gets some members on this forum to lose touch with reality.

[NoDisplayName]

16 minutes ago, freeworld said:

Yes because those streams of income (Thai based dividends and Interest) are accrued in Thailand and they are known how to be treated according to the law.

....and apparently the new law says......

Quote

abroad or wealth that is located abroad…and has brought these assets into Thailand…

 

must factor this into their personal income tax for the year.”

 

new guidelines which will see all income from abroad taxed as personal income tax regardless of whether it was earned income or savings.

As stated previously, we don't know nuttin' yet.  How will this be implemented?  If wealth abroad brought into Thailand, whether earned income or savings, will factor into personal income tax, how will the authorities handle this?

 

They certainly won't wait until the following year to get their cut, knowing the funds are liable to be sent out of Thailand just as easily.  If it's too cumbersome (for them) to make the determination for each incoming deposit (over a set minimum I suppose), then better to tax everything and let the poor plebes deal with getting the overtax back next year.

[DrJack54]

Most hilarious thread for a long time. 

[freeworld]

37 minutes ago, NoDisplayName said:

....and apparently the new law says......

As stated previously, we don't know nuttin' yet.  How will this be implemented?  If wealth abroad brought into Thailand, whether earned income or savings, will factor into personal income tax, how will the authorities handle this?

 

They certainly won't wait until the following year to get their cut, knowing the funds are liable to be sent out of Thailand just as easily.  If it's too cumbersome (for them) to make the determination for each incoming deposit (over a set minimum I suppose), then better to tax everything and let the poor plebes deal with getting the overtax back next year.

Thailand does not tax wealth. It is income tax.

 

How do they find it and possibly tax it, like everywhere else, one has to declare it and submit a tax return with backup.

 

How do they control it, long stay residents present a tax residence certificate at departure.

 

The rest is just speculating.

 

 

[freeworld]

24 minutes ago, DrJack54 said:

Most hilarious thread for a long time. 

Trying to beat the other one, over 2000 posts so far and going strong.

[NoDisplayName]

10 minutes ago, freeworld said:

Thailand does not tax wealth. It is income tax.

 

How do they find it and possibly tax it, like everywhere else, one has to declare it and submit a tax return with backup.

 

The rest is just speculating.

 

 

I don't know what to speculate.

 

Quote

or wealth that is located abroad…and has brought these assets into Thailand…

 

must factor this into their personal income tax for the year.”

 

all income from abroad taxed as personal income tax regardless of whether it was earned income or savings.

 

[persimmon]

Say you send money to the wife or GF . How will the tax dept. know whether this is income or just a gift . I assume gifts cannot be taxed , but who knows ?

[freeworld]

1 minute ago, NoDisplayName said:

I don't know what to speculate.

 

 

Where did this come from, was it issued by RD?

[DrJack54]

19 minutes ago, freeworld said:

Trying to beat the other one, over 2000 posts so far and going strong.

23,000

Few rubbish posts from me and many  helpful.

 

Move along expert. 

You have made numerous posts in this thread...

Mostly rubbish. 

 

[freeworld]

19 minutes ago, DrJack54 said:

23,000

Few rubbish posts from me and many  helpful.

 

Move along expert. 

You have made numerous posts in this thread...

Mostly rubbish. 

 

Don't understand the animosity.

 

I just commented that on the other thread about tax there are over 2000 posts so far.

[NoDisplayName]

31 minutes ago, freeworld said:

Where did this come from, was it issued by RD?

Thailand’s revenue departments has released new guidelines which will see all income from abroad taxed as personal income tax regardless of whether it was earned income or savings.

A senior official at the Ministry of Finance confirmed a document released by the revenue department over the weekend was accurate.

According to the document, “…those that have earnings from occupation or business abroad or wealth that is located abroad…and has brought these assets into Thailand…must factor this into their personal income tax for the year.”

 

https://www.thaienquirer.com/50744/thai-government-to-tax-all-income-from-abroad-for-tax-residents-starting-2024/

[freeworld]

28 minutes ago, NoDisplayName said:

Thailand’s revenue departments has released new guidelines which will see all income from abroad taxed as personal income tax regardless of whether it was earned income or savings.

A senior official at the Ministry of Finance confirmed a document released by the revenue department over the weekend was accurate.

According to the document, “…those that have earnings from occupation or business abroad or wealth that is located abroad…and has brought these assets into Thailand…must factor this into their personal income tax for the year.”

 

https://www.thaienquirer.com/50744/thai-government-to-tax-all-income-from-abroad-for-tax-residents-starting-2024/

So it is a news article.

 

Here is another interpretation from another news article:

Thailand Revenue Department’s Latest Order Expanding the Tax Assessment of Individuals’ Foreign Source Income

On 15 September 2023, the Thai Revenue Department (RD) issued RD order no. Por. 161/2566 (the “New Order”) providing new guidelines for income tax assessment per Section 41 of the Revenue Code. The notable change is that, going forward, a resident of Thailand would have the obligation to assess income from foreign sources as a part of assessable income of the tax year (i.e., calendar year starting from 1 January to 31 December of such year) which it is brought into Thailand. This New Order will be effective on 1 January 2024.

 

So the new guidelines are that RD issued POR. 161/2566?

[NoDisplayName]

23 minutes ago, freeworld said:

So it is a news article.

 

Here is another interpretation from another news article:

Thailand Revenue Department’s Latest Order Expanding the Tax Assessment of Individuals’ Foreign Source Income

On 15 September 2023, the Thai Revenue Department (RD) issued RD order no. Por. 161/2566 (the “New Order”) providing new guidelines for income tax assessment per Section 41 of the Revenue Code. The notable change is that, going forward, a resident of Thailand would have the obligation to assess income from foreign sources as a part of assessable income of the tax year (i.e., calendar year starting from 1 January to 31 December of such year) which it is brought into Thailand. This New Order will be effective on 1 January 2024.

 

So the new guidelines are that RD issued POR. 161/2566?

What exactly do you want to know?

We have a new regulation going into effect soon.

Some news articles report it one way, others report it differently, maybe.

Afraid I can't give you any definitive answers.

We'll just have to wait and see.

I am hoping for the best.

I am planning for the worst.

I have low expectation for the hub of failed policies.

 

 

[phetphet]

8 hours ago, freeworld said:

Some are even speculating all foreign bank transfer remittances are going to be taxed by the banks, haha.

Bringing a chunk of cash back whenever returning to home country could keep total annual bank transfers for living below any taxable level. it wouldn't necessary have to be a really large sum

[david555]

38 minutes ago, phetphet said:

Bringing a chunk of cash back whenever returning to home country could keep total annual bank transfers for living below any taxable level. it wouldn't necessary have to be a really large sum

might many do not know , foreign cash must be changed to Thai baht if longer than 360 days in Thailand  BOT rule....

 

, ( i know guy's..... i did not folllowed that ruling neither in my 14 years stay Thailand  but it exist ,

 

same as any Gold bullion in to Thailand needs a import license ,or deposit to customs by arrival and receive back by departing Thailand

https://www.iatatravelcentre.com/TH-Thailand-customs-currency-airport-tax-regulations-details.htm

 

Some long time nasty forgotton & hidden Thai financial rules ....

Thai Bank regulation BOT.pdf

[Neeranam]

9 hours ago, freeworld said:

The bank will report foreigners account to the RD, balance and deposits, that is already part of CRS/FATCA, they have the residential address and can contact the home country to get information if tax was paid or not.

I doubt they will target foreigners, it's the Thais they're after. 

[ChaiyaTH]

There is like zero news in this entire post, or am I the only one who can read that from it? He is giving 4-5 examples that are the obvious to anyone in the first place, obviously you do not pay double tax if you already pay tax elsewhere.

The entire point is how it works with for example savings that are older already. And how to prove that. Aside from that it effects people who live or run off-shore. And so many other things.

If anyone was worried just because of what is explained in this topic, I am surprised.

[ChaiyaTH]

1 minute ago, Neeranam said:

I doubt they will target foreigners, it's the Thais they're after. 

Doesn't matter who they target, if the law also applies to us and you then mess around, it suddenly can turn into a criminal issue. I doubt their skills or focus on us too.

[ChaiyaTH]

49 minutes ago, phetphet said:

Bringing a chunk of cash back whenever returning to home country could keep total annual bank transfers for living below any taxable level. it wouldn't necessary have to be a really large sum

Well yeah, that is kind of what it comes down too if it does come to taxing for real. If I would become a tax resident back home in my country in Europe, I can actually, with my girlfriend not earning, having a child, earn easily up to 2500 euro without effectively paying any tax at all, as a small business owner.

 

This while if I would earn this in Thailand, I'd end up paying 10-15K tax a month, getting zero in return on top, while in europe I would also get all kinds of other benefits + even a basic old day pension lol, well what is basic, it's actually near 50K baht.

 

They lost their minds if they push this, while not even giving us permanent residency or other benefits in return. Wish anyone a lot of fun paying for it, if it does happen, I won't pay it here.

Thailand has zero to offer, to make it worth paying taxes, as a foreigner. Unless it's just paying fake taxes, I mean like so many local foreign owners do here, paying 2-3K max.

[Neeranam]

10 hours ago, ThaiLawOnline said:

If you earn incomes from crypto, it is obvious that the Thai government and other countries, what to control the gains and tax you. They also want to stop loopholes as you can live in Thailand, get money into your bank account and nobody checks where it comes from if you are under the radar, or limits the governments check.

How on Earth will they be able to keep up with P2P transfers on exchanges like Binance?

It's easy to get crypto debit cards from other countries and use them in Thailand or any country around the world.