Change in the tax law does target expats living in Thailand and extends reporting obligations

[Thaindrew]

3 hours ago, samtam said:

 

Colombia and Thailand are very disparate countries to each other, as indeed they are to Hong Kong SAR and Singapore (in terms of tax), and yet the latter 2 have very favourable tax regimes, (as noted by the lawyer in the OP).

 

 

 

Unfortunately living in either Hong Kong or Singapore would cost you infinitely more in housing and cost of living, than any new tax in Thailand.

 

Malta looks like a nice option, non EU citizens can live for 3 years tax free on a nomad visa - maybe something good has come from Brexit

[Thaindrew]

2 hours ago, Ben Zioner said:

So, they won't pay any tax in Thailand anyhow, DTA or not. That's all I was trying to say.

 

catch 22 though, 65000 a month for a retirement visa (without an agent) so they could argue that is the minimum remittance you could "live on" and hence be taxed on, if you claim you are living on less their first question would be "how did you get this visa then?" 

[Brickleberry]

12 minutes ago, MangoKorat said:

As I say, what I posted is my understanding and an article by a tax accountant said the same. I'm not about to try and find that article as it was weeks ago when these new tax rules were first reported. We will have to wait and see how things turn out but I don't agree that pension income such as I mentioned would be subjected to tax twice. If its your sole income and its under the UK threshold it simply will not be assessed and not taxed. Most people won't have been required to submit a UK tax return so income that is under the tax threshold will automatically not have been assessed.

 

As for getting a tax refund, of course not, for that income to have been taxed in the UK, you would surely need to have been resident in the UK at the time it was received and then UK tax rules would apply with tax being charged accordingly, would it not? If you moved to Thailand during the corresponding tax year, no tax would be due in Thailand - isn't that the very basis of a double taxation agreement?

 

 

 

 

 

my understanding

 

You can also avoid paying tax legally in the UK, if you are not British: Non-Domicile status allows the person to only pay tax on income earned in the UK. If all of your income is derived from overseas, you pay nothing. Isn't this the way Thailand should do it? You only pay taxes on money earned in Thailand. 

[MangoKorat]

4 hours ago, Ben Zioner said:

You are correct, I  don't know how low  UK state pensions are, but I have calculated that people transferring the IO required minimum of 65000 a month would end up paying something like 3000 a month. That's about one beer less a day, quite healthy isn't? And considering that the price of a beer is mostly tax, the government won't get any richer  either.

The current UK basic state pension is just under £204 per week. Many will receive more than that depending on their contributions but some will also receive less as their pension amount is frozen if they move to live in Thailand.  Roughly, £204 per week = 38,896 baht per month (208x52 = 10608 divided by 12 months = £884 X 44 baht = 38,896).  The UK tax threshold is currently £12,570 per annum.

Edited November 6, 2023 by MangoKorat

[Mike Lister]

1 minute ago, Brickleberry said:

 

You can also avoid paying tax legally in the UK, if you are not British: Non-Domicile status allows the person to only pay tax on income earned in the UK. If all of your income is derived from overseas, you pay nothing. Isn't this the way Thailand should do it? You only pay taxes on money earned in Thailand. 

Not domiciled and not resident for   tax purposes are different things. Anyone can become not resident for tax purpose as long as they spend less than 180 days per tax year in the UK, that mean they will only pay UK tax on income that arises there. Not domiciled is only applicable to people who are not UK citizens.

[vangrop]

is this the end of the Cheap Charlies? I cannot imagine how they would survive if they will also be taxed on their meager pension. This is the end of the Katesiree

[MangoKorat]

3 minutes ago, Brickleberry said:

 

You can also avoid paying tax legally in the UK, if you are not British: Non-Domicile status allows the person to only pay tax on income earned in the UK. If all of your income is derived from overseas, you pay nothing. Isn't this the way Thailand should do it? You only pay taxes on money earned in Thailand. 

We will have to wait and see. Hopefully they'll realise that rather than provide additional income for Thailand, these changes are very likely to see a huge loss.

[Sato]

6 minutes ago, freeworld said:

No it does make one a permanent resident until it is applied for and granted by the immigration laws of a country.

 

Some countries have also reduced the 180 day rule and now consider about 90 days and a total number of days over a period of time then one is deemed tax resident.

 

The tax residence is still related to the description in the tax laws/code ie. the length of time one resides within and the ties and financial obligations etc...)

 

Check the OECD tax residency information for different countries.

You are again wrong and I do not need to check the OECD tax residence information as alone the regulations of my country is relevant which I'm very well aware of.

 

Furthermore you are also wrong in your statement regarding '180' or '90' day rule.

 

The rule is: you pay taxes where your 'focal point of life' is. 

 

AND again: you are only taxholder when you are resident of my home country and are register as such with the municipality and at the same time you cannot be resident AND taxholder in my home country when you're 'focal point of life' is not in the country.

[MangoKorat]

8 hours ago, Dan O said:

That tax consultant is wrong in his reading it. Read your country's DTA for yourself as most all exclude govt pensions from taxation outside the issuing country. 

Thanks, I'll certainly check that out.  I'll be very happy to be wrong on this.

[quake]

The silence from the real-estate companies is deafening.

[MangoKorat]

2 minutes ago, quake said:

The silence from the real-estate companies is deafening.

Maybe it hasn't sunk in with them yet?

[stat]

10 hours ago, HappyExpat57 said:

 

I placed the laugh emoticon - I have trouble imagining how they will ever figure that out!

They do not have to figure out anyting. They just state everyting you remit is taxable. You have to prove that everything has been taxed. Thai RD will only accept an affidavit signed by the pope and your head of state. Apparently you have never dealt with a tax authority in any country, no offense my friend.

[VBF]

Has anyone considered that the originator of the linked article is  "A former chairman of Baker McKenzie, an international law firm with offices in Thailand and a member of the National Reform Council"

He's not a member of government and the article actually states:  "New regulation changes an interpretation which disregards when money was earned abroad and taxes all income if not already taxed by treaty countries"

 

So a little early to be worrying as if it was an actual change in the law?

[stat]

24 minutes ago, Sato said:

You are again wrong and I do not need to check the OECD tax residence information as alone the regulations of my country is relevant which I'm very well aware of.

 

Furthermore you are also wrong in your statement regarding '180' or '90' day rule.

 

The rule is: you pay taxes where your 'focal point of life' is. 

 

AND again: you are only taxholder when you are resident of my home country and are register as such with the municipality and at the same time you cannot be resident AND taxholder in my home country when you're 'focal point of life' is not in the country.

There is no worldwide rule... Every country has its own laws. So your focal point of life as a tie breaker is not correct.

[Mike Lister]

9 hours ago, Dan O said:

That tax consultant is wrong in his reading it. Read your country's DTA for yourself as most all exclude govt pensions from taxation outside the issuing country. 

 

25 minutes ago, MangoKorat said:

Thanks, I'll certainly check that out.  I'll be very happy to be wrong on this.

The UK State Pension is NOT a government pension, that is something paid to members of the civil service or similar, this has been clarified many times.

[stat]

Just now, VBF said:

Has anyone considered that the originator of the linked article is  "A former chairman of Baker McKenzie, an international law firm with offices in Thailand and a member of the National Reform Council"

He's not a member of government and the article actually states:  "New regulation changes an interpretation which disregards when money was earned abroad and taxes all income if not already taxed by treaty countries"

 

So a little early to be worrying as if it was an actual change in the law?

You can of course wait till you receive a final notice of how much tax you have to pay in 2025.

[HappyExpat57]

Just now, stat said:

They do not have to figure out anyting. They just state everyting you remit is taxable. You have to prove that everything has been taxed. Thai RD will only accept an affidavit signed by the pope and your head of state. Apparently you have never dealt with a tax authority in any country, no offense my friend.

 

I've been paying taxes since I was 12 years old (paperboy for the San Francisco Chronicle). I've been audited and have been an assistant to an accountant. I have a clear idea of what taxes are about, and you're not my friend, buddy (South Park reference).

[Mike Lister]

3 minutes ago, stat said:

They do not have to figure out anyting. They just state everyting you remit is taxable. You have to prove that everything has been taxed. Thai RD will only accept an affidavit signed by the pope and your head of state. Apparently you have never dealt with a tax authority in any country, no offense my friend.

Nobody has said or even implied that everything you remit is taxable, stop rumour mongering and making false claims.

[MangoKorat]

5 minutes ago, VBF said:

Has anyone considered that the originator of the linked article is  "A former chairman of Baker McKenzie, an international law firm with offices in Thailand and a member of the National Reform Council"

He's not a member of government and the article actually states:  "New regulation changes an interpretation which disregards when money was earned abroad and taxes all income if not already taxed by treaty countries"

 

So a little early to be worrying as if it was an actual change in the law?

He is quoting a law that is due to be introduced next year.

[VBF]

Just now, MangoKorat said:

He is quoting a law that is due to be introduced next year.

Due to be introduced, maybe. Do please remember "TIT" 😋

[Mike Lister]

Just now, VBF said:

Due to be introduced, maybe. Do please remember "TIT" 😋

May I suggest the correct wording is, "may be introduced next year".

[NZAMBOY]

11 hours ago, HappyExpat57 said:

I believe most people here are safe - for now.

 

"At the time of writing, Thailand has concluded 61 double tax agreements with countries worldwide.

Armenia	Hungary	Poland
Australia	India	Romania
Austria	Indonesia	Russia
Bahrain	Israel	Seychelles
Bangladesh	Italy	Singapore
Belarus	Japan	Slovenia
Belgium	Korea	South Africa
Bulgaria	Kuwait	Spain
Cambodia	Laos	Sri Lanka
Canada	Luxembourg	Sweden
Chile	Malaysia	Switzerland
China	Mauritius	Taipei
Cyprus	Myanmar	Tajikistan
Czech Republic	Nepal	Turkey
Denmark	Netherlands	Ukraine
Estonia	New Zealand	United Arab Emirates
Finland	Norway	United States of America
Germany	Oman	Uzbekistan
Great Britain and Northern Ireland	Pakistan	Vietnam
Hong Kong	Philippines"

 

https://www.belaws.com/thailand/double-tax-agreements/

Who care about the double tax agreement when my country NZ,  doesn't charge capital gains on property sales and Thailand charges something like 39% on capital gains...big loss for me as i see it...

[Karma80]

51 minutes ago, Metapod said:

 

withdrawing cash from ATM from an overseas bank while in Thailand is still a remittance and liable for tax.

 

True. But then thousands of people working in co-working spaces as digital nomads can't and would be liable for tax.

5% of Thai people actually pay tax regularly. 95% of people don't pay tax at all.

When you put it into perspective, taking money out of an ATM with an overseas card, in a sea of millions of tourists, is not even on the RD radar this century.

[VBF]

5 minutes ago, Mike Lister said:

May I suggest the correct wording is, "may be introduced next year".

And may I add  "may be introduced next year, after several changes, back tracks, forward leaps, interventions by vested interests etc etc".

Edited November 6, 2023 by VBF

[Mike Lister]

2 minutes ago, Karma80 said:

True. But then thousands of people working in co-working spaces as digital nomads can't and would be liable for tax.

5% of Thai people actually pay tax regularly. 95% of people don't pay tax at all.

When you put it into perspective, taking money out of an ATM with an overseas card, in a sea of millions of tourists, is not even on the RD radar this century.

6% of people pay tax via the equivalent of PAYE, that doesn't mean the rest don't file returns and pay tax, they do, but as a limited company or as self employed. But because average earnings here are so low, many are under the tax threshold.

[MangoKorat]

8 minutes ago, Mike Lister said:

May I suggest the correct wording is, "may be introduced next year".

Yes, much like the new 4am opening hours which now appear to be not quite what they seemed with sales of alcohol ending at 2am..............everything and anything is possible in the land where election winners don't actually become the government.

 

However, they think this one will actually make them money so you can be sure they will push for it.  I'm pretty sure that if these laws are actually introduced, the net result for the country as a whole will be that they lose money.  However, Thai logic can sometimes defy all reason - remember the pre booking.com days?  When tourism was down and hotels were struggling, they used to put their prices up!

Edited November 6, 2023 by MangoKorat

[HappyExpat57]

6 minutes ago, NZAMBOY said:

Who care about the double tax agreement when my country NZ,  doesn't charge capital gains on property sales and Thailand charges something like 39% on capital gains...big loss for me as i see it...

 

Who "care?" I certainly don't. Why did you direct this at me?

[MangoKorat]

11 minutes ago, Karma80 said:

When you put it into perspective, taking money out of an ATM with an overseas card, in a sea of millions of tourists, is not even on the RD radar this century.

Something I had already considered.  It would all depend of course on whether or not there it works out cheaper after charges etc. but transfer companies such as WISE offer the option of a Baht account with a card that they state, can be used in most Thai ATM's.

 

However, many people have to show an amount of income in order to either obtain a visa or an extension of stay.  It would be difficult to state your income is 65,000 for extension purposes then deny you have an income to the Tax Authority.

[JackGats]

9 hours ago, Gknrd said:

I'm in Colombia getting some dental work done. Same tax laws here that are going into effect in Thailand. I like it here because I am not hassled as far as immigration goes. But, I have heard some horror stories here about the taxes. They are supposedly going to start cracking down here.

 

Your pension is tax-free in Colombia up to about 8 thousand USD a month. Capital gains get taxed.

[Mike Lister]

19 minutes ago, NZAMBOY said:

Who care about the double tax agreement when my country NZ,  doesn't charge capital gains on property sales and Thailand charges something like 39% on capital gains...big loss for me as i see it...

Thailand does NOT charge 39% capital gains on the sale of property! Capital Gains in Thailand are charged at personal Income tax rates, this means you pay pay tax on a stepped scale, anywhere from 0% to 30%. If the capital gain was a million baht, the effective tax rate would about 14%.