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

[Sheryl]

42 minutes ago, KannikaP said:

Yes, I paid tax on my UK Pension, which is paid into a UK Bank, at 0%, because the annual total is below £12570.

You did not pay tax. You filed a tax return and no tax was assessed.

 

To claim a tax credit, there has to be an amount paid. (I suppose you could out "0" under tax credit but that amounts to same thing).

 

There are 2 ways that terms of a DTA can help one with Thai taxes:

 

1. Exemption - some DTAs state that some income sources cannot be taxed in Thailand, only in the state of nationality. Not the case for UK State Pension apparently (but is the case for UK Government pension).

 

2. Tax credit - your Thai tax can be decreased by amount of tax already paid in your home country. Which in your case is none. So no decrease.

[The Cyclist]

I'll just leave this here

 

Quote

However, if an income earner has already paid taxesin their country of income origin, provided there is a Double Tax Agreement in place between Thailand and that country, the income earner can utilize the taxes paid in the country of origin as a tax credit, following the provisions outlined in the respective Double Tax Agreement.

 

https://mahanakornpartners.com/the-revenue-department-closes-loopholes-tightening-tax-collection-on-foreign-income/

[stat]

8 hours ago, hondoelsinore said:

I wouldn't even attempt to speak English with such a heavy accent, but the world is full of idiots, especially on YouTube. 

Really? So how many languages do you speak as "good" as the french guy does speak english? Reminds me of my parachute training buddies in the UK who were asking me how it feels to speak another language :-) (I love the UK and the US , always felt more at home there then in Germany)

[stat]

2 hours ago, TroubleandGrumpy said:

Seems to me that quite a few people are arguing what 'this clause' or 'that clause' means under a DTA.

@Sheryl  Is merely pointing out what the rule states - there is no point arguing about it guys.

Exactly how the Thai RD determines how any applicable DTA clause will/wont apply, is solely up to the Thai RD.

This is not the West where the rules and laws are detailed and people can 'push back' on what they mean in application.

This is one of the many issues that the Thai RD must now address - they never have for personal taxes in the past.

 

We will all have to wait until the Thai RD releases its clarifications and exemptions and determinations, before 'knowing' anything.

Arguing over what a clause/paragraph in a DTA or the Thai RD Guidelines is a waste of time.

IMO best to start preparing and planning and wait - best case scenario, worst case scenario, acceptable scenario.

 

The Thai RD has been 'operating' for decades based upon very few detailed definitive 'guidances'.

A lot of their rules/interpretations have been sorted out in Court - it is a very complex thing writing tax laws/rules.

This change is being made (for obvious reasons) to an 'interpretation' that was ratified in a Court over 30 years ago.

The reason is simple - the Govt needs more money - but they have under-estimated how hard this will be (far too many issues).

 

My plan is simple - and it seems others are of the same thought.

I am bringing forward remittances into Thailand this year (for 2024) and will bring in the absolute minimum in 2024.

Before the end of 2024 it should be clear what the Thai RD is going to do regarding remittances into Thailand by retired/married Expats.

It could also be that the Thai Govt does what Malaysia did, and defers implementation for a few years.

Malaysia did that because it was going to take that long to determine all the rules and clarifications etc. and publish them.

 

If I am going to be 'forced' to lodge a tax return in 2025 and it appears I will be paying income taxes - then we are leaving Thailand.

Unless it is a resonable amount and I get something in return - legal rights, no 90 days, no annual begging to stay, health services, etc.

Spot on! Try claiming any DTA exemption in TH and you will have a problem is my take on the situation as well.

[Puccini]

44 minutes ago, stat said:

...So how many languages do you speak as "good" as the french guy does speak english...

 

What French guy?

[Maestro]

Removed some off-topic posts and the replies to them.

[The Cyclist]

46 minutes ago, stat said:

Spot on! Try claiming any DTA exemption in TH and you will have a problem is my take on the situation as well.

 

If Thailand is making changes on 01 Jan 2024 in order to

 

Quote

that these modifications in personal income tax collection methods align with Thailand’s objectives as a member of international tax forums and its commitment to multilateral agreements.

 

Kinda blows your take on it right out the water.

 

Just like most ( if not all ) the previous Doom & Gloom, across multiple threads, will be blown right out the water.

[brewsterbudgen]

Can someone summarise this thread for a layman who can't plow through all the responses?  Is it all a fuss about nothing?

[samtam]

I have just gone into my UOB branch in Silom Complex to effect some minor banking operations, (updating my passbook and asking for a breakdown of an aggregated sum). One of the transactions had a narrative EFT, and I asked what that was, as it was not included in the transaction code list at the back of the passbook. They had to inquire in the back office.  Twenty minutes later I tried to proceed with other inquiries, (adding a power of attorney, initially an unknown concept, and twenty minutes after that, deciding to abandon that for another day). If Thai RD are going to rely on banks to help them sift through customers' transactions, they are in for a very long slog. UOB is about average on the scale of ineptitude.

 

My recent registration for the facial ID facility was another exercise in the stimulation of high blood pressure, as despite numerous SMS notifications, the staff in another UOB branch seemed to know very little about how this worked, what an electronic chip was in a passport etc, and 50 minutes later, I limped out, exhausted by the ordeal.

 

Perhaps one little hurdle Thai RD need to consider for their cunning masterplan.

[Felt 35]

1 hour ago, stat said:

Spot on! Try claiming any DTA exemption in TH and you will have a problem is my take on the situation as well.

If Thailand has a tax agreement with another country, they must follow the agreement and cannot for their own benefit change it until a possible new agreement is in place and it takes a long time to renegotiate tax agreements.

Felt

[JimTripper]

56 minutes ago, brewsterbudgen said:

Can someone summarise this thread for a layman who can't plow through all the responses?  Is it all a fuss about nothing?

 

death & taxes

[Ricardo]

25 minutes ago, JimTripper said:

 

death & taxes

 

Happily death generally only happens once, whereas taxes are annual (or more), and an experience laden with onerous paperwork, which I (and many others ?) had hoped to have left behind, when I retired to live here !  

 

I'd much prefer, if the RD want/need to raise serious amounts of money, that they raise the VAT-rate ?  Yet they seem reluctant to do something like that, surely not because it would impact their voters, and not just us allegedly-rich farangs.  

[The Cyclist]

1 hour ago, brewsterbudgen said:

Can someone summarise this thread for a layman who can't plow through all the responses?

 

2 words

 

Wait out ( For further clarification )

 

1 hour ago, brewsterbudgen said:

Is it all a fuss about nothing?

 

2 words

 

Most likely.

[Klonko]

1 hour ago, Felt 35 said:

If Thailand has a tax agreement with another country, they must follow the agreement and cannot for their own benefit change it until a possible new agreement is in place and it takes a long time to renegotiate tax agreements.

Felt

Good luck explaining your tax return and account statements, possibly containing taxed and untaxed funds, from your home country to your local Thai RD officer.

[UKresonant]

Just now, The Cyclist said:

 

The only pensions covered by the UK - Thai DTA are what are termed ' Government Pensions ' whether the RD classify the UK State Pension ( Paid by the State / Government ) as coming under the banner of ' Government Pension ' comes under wait and see / further clarification needed.

Hope they don't read note 4 on the digest summary.

"4. Treaty does not include an article dealing with DT-Company Non-Government pensions. Also, no relief for State Pension or ‘trivial commutation lump sum’."

https://assets.publishing.service.gov.uk/media/5b05425fed915d1317445ed2/DT_Digest_April_2018.pdf

 

 

[The Cyclist]

1 minute ago, UKresonant said:

Hope they don't read not 4 on the digest summary.

 

Is it beyond you to understand that what they might read and what they actually do might be 2 different things ?
 

Which is why have to keep reminding you and others, wait for the details to come from the Thai Gov / RD.

 

By the time I mature enough to claim the State Pension, the UK will have raised the age limit again, I will already be dead, or Thailand will have issued clear direction.

 

So keep posting doom & gloom about the State Pension, I am not old enough to care about it, far less worry about it.

[stat]

2 hours ago, Felt 35 said:

If Thailand has a tax agreement with another country, they must follow the agreement and cannot for their own benefit change it until a possible new agreement is in place and it takes a long time to renegotiate tax agreements.

Felt

They do not need to change the DTA. Example: beforehand no tax on capital gains in Thailand, now you have to pay capital gains tax on remittances. There is no DTA involved if you only live in Thailand in cap gains case.

 

Next example German pension: Beforehand TH has taxation right but did not tax it; after 01 Jan 24 you pay income tax on German pension if remitted to Thailand. And again in other cases, if you want to use a dta you must provide tons of translated documents and be willing to go to court. If the disputed tax is 50K USD and above maybe worth it, everything under 50K not worth the time and effort.

 

PS: May I ask you in which capacity you provide financial advise in order to make the above claim about DTAs in general? There are people on this board including me who work in banking and provide tax counsel in international tax matters FYI.

[UKresonant]

Just now, The Cyclist said:

 

Is it beyond you to understand that what they might read and what they actually do might be 2 different things ?
 

Which is why have to keep reminding you and others, wait for the details to come from the Thai Gov / RD.

 

By the time I mature enough to claim the State Pension, the UK will have raised the age limit again, I will already be dead, or Thailand will have issued clear direction.

 

So keep posting doom & gloom about the State Pension, I am not old enough to care about it, far less worry about it.

 

But the taxation regime has not changed, so hopefully someone will have an experience to report on the subject, of what they are doing probably next return period 1st quarter 2024. All they have been told to do is pursue basically the same  'doom & gloom' rules as when I looked it at the subject in 2018, (and decided less than 179 days in Thailand that year).

 

It's just unfortunate the magical considered savings from previous years interpretation, that made things so easy, and avoided the hassle of getting caught between two out of sync tax years, provided you kept at least one or more years budget ring fenced, is going.  Since I'll always be tax resident in the UK just that may be tax resident in Thailand simultaneously. 

 

Hope they don't change the state pension age thing again, as I think there was a custom and practice of 10 years notice, hopefully within range to surely get something.

 

Broadband engineer will arrive shortly to upgrade the doom & gloom device network to fibre (must have Gov., wants to phase out copper lines apparently), so will take a break. UK internet= Double the price of Thailand for a 6th of the performance! No faster than the copper line.

 

 

 

[stat]

1 minute ago, UKresonant said:

 

But the taxation regime has not changed, so hopefully someone will have an experience to report on the subject, of what they are doing probably next return period 1st quarter 2024. All they have been told to do is pursue basically the same  'doom & gloom' rules as when I looked it at the subject in 2018, (and decided less than 179 days in Thailand that year).

 

It's just unfortunate the magical considered savings from previous years interpretation, that made things so easy, and avoided the hassle of getting caught between two out of sync tax years, provided you kept at least one or more years budget ring fenced, is going.  Since I'll always be tax resident in the UK just that may be tax resident in Thailand simultaneously. 

 

Hope they don't change the state pension age thing again, as I think there was a custom and practice of 10 years notice, hopefully within range to surely get something.

 

Broadband engineer will arrive shortly to upgrade the doom & gloom device network to fibre (must have Gov., wants to phase out copper lines apparently), so will take a break. UK internet= Double the price of Thailand for a 6th of the performance! No faster than the copper line.

 

 

 

First hand experiences of the new directive will only show in Mid 2025 , not earlier. End of march 2025 you should hand in your tax declaration in TH. Never mind that most western banks provide their tax statements end of June.

[hondoelsinore]

4 hours ago, stat said:

Really? So how many languages do you speak as "good" as the french guy does speak english? Reminds me of my parachute training buddies in the UK who were asking me how it feels to speak another language :-) (I love the UK and the US , always felt more at home there then in Germany)

~yawn~ 

[lordgrinz]

2 hours ago, Ricardo said:

and an experience laden with onerous paperwork, which I (and many others ?) had hoped to have left behind, when I retired to live here !  ]

 

This is the land of "onerous paperwork", "you chose poorly".

 

 

[Danderman123]

Most recent posts here are unintelligible. 

 

Please remember that not all of us are from the UK, so when you start throwing around 3 letter acronyms related to UK taxation, the rest of us have no idea what you are talking about.

 

Concerning capital gains tax (this is an area of income received by many retirees), there doesn't seem to be a Thai capital gains tax for individuals.

[Gknrd]

I belong to an exclusive club, it is called the F$ck you club..  

What is it?  How do you join?

 

1: You work and save until you pay cash for a home

2: You pay cash for a car in the garage

3: You put money in investments to pay you 6% and generate enough to pay all taxes , utilities, and emergency.

 

Hence, F$ck you Thailand, your taxes, your 800K the works.. Life is good.

When you belong to that club nothing bothers you what so ever..

[Lorry]

43 minutes ago, Gknrd said:

you pay cash for a home

Illegal in many countries

[rabas]

2 hours ago, stat said:

PS: May I ask you in which capacity you provide financial advise in order to make the above claim about DTAs in general? There are people on this board including me who work in banking and provide tax counsel in international tax matters FYI.

He is just repeating what the Thai RD already explained, if you've been keeping track. It's a translation but the point is clear.

 

"However, if the person who has the money has already been taxed in the country of origin of the money. Those who have income can Tax that is retained by the country of income that has a double tax treaty with Thailand can be used as a tax credit. According to the criteria specified in the double tax treaty."

 

Full RD dept statement:

https://www.rd.go.th/fileadmin/user_upload/news/2566thai/news34_2566.pdf

 

English translation. news34_2566-eng.pdf

 

[JackGats]

1 hour ago, Danderman123 said:

...

 

Concerning capital gains tax (this is an area of income received by many retirees), there doesn't seem to be a Thai capital gains tax for individuals.

Indeed. Suppose you have a trading account in country A where the capital gains tax is 30%. You sell stocks at a profit but in country A you are registered as living in TH and having your tax residence in TH. Therefore country A levies 0% tax on the profit-taking, leaving it for Thailand to tax it.  However, as far as I know Thailand has no tax on profit-taking, only on dividends. TH is not supposed to levy taxes that don't exist in TH.

 

[stat]

1 hour ago, Danderman123 said:

Most recent posts here are unintelligible. 

 

Please remember that not all of us are from the UK, so when you start throwing around 3 letter acronyms related to UK taxation, the rest of us have no idea what you are talking about.

 

Concerning capital gains tax (this is an area of income received by many retirees), there doesn't seem to be a Thai capital gains tax for individuals.

It is taxed as ordinary income if not from trading on a thai exchange

[stat]

29 minutes ago, rabas said:

He is just repeating what the Thai RD already explained, if you've been keeping track. It's a translation but the point is clear.

 

"However, if the person who has the money has already been taxed in the country of origin of the money. Those who have income can Tax that is retained by the country of income that has a double tax treaty with Thailand can be used as a tax credit. According to the criteria specified in the double tax treaty."

 

Full RD dept statement:

https://www.rd.go.th/fileadmin/user_upload/news/2566thai/news34_2566.pdf

 

English translation. news34_2566-eng.pdf

 

I can tell you it is very complicated to claim shelter under an DTA. But go ahead and believe  whatever you chose you are up for a big surprise.

[Gknrd]

1 hour ago, Lorry said:

Illegal in many countries

Where?

[Captain Monday]

1 hour ago, Lorry said:

Illegal in many countries

Interesting What countries?

 

”Paying cash” for  home is an Americanism simply meaning not taking out a home loan or mortgage

Escrow agents accept personal cheque, cashiers cheques, mostly electronic transfers or wires

 

There is nothing illegal in US about paying with paper bills but I doubt reputable escrow agents would accept a huge bag of money as there is handling and counting risk. IRS/FinCEN reporting requirements still apply.

People actually do  for sale by owner home sales  to avoid the bloodsuckers. Nothing illegal about it

 

https://www.rocketmortgage.com/learn/buying-a-house-with-cash