Taxation of Ex-Pats pensions etc.

[worrab]

Having had a chat with a Financial Advisor (Carl Turner Financial) about the future regarding taxation here in Thailand I have an idea of what will happen. Very simply put, any money remitted to Thailand after 1st Jan 2024 will be subject to Thai taxation. You will need to register and obtain a TIN, take note Cake Monster as just because you do not have a Thai ID does not stop you registering. And with the global approach now coming in and the sharing of banking information, all countries will know what you have and what you have sent here from your UK banks etc.  

 

Here is a question that was asked at a Q&A with the RD.

Question: If assessable income brought into Thailand was already taxed abroad and you bring that income back to Thailand, do you have to pay taxes again on this assessable income and end up paying double taxation?

Answer: There is no double taxation in this case. If you are deemed a a tax resident of Thailand (staying in Thailand for  180 days or more), the tax paid abroad can be credited against the tax paid in Thailand in the tax year that assessable income was brought into Thailand according to the provisions of the Double Tax Treaty to which Thailand is a contracting party. 

 

And now the Revenue Department's recent interpretation of Order No. Di. Por.161/2023 presents a major shift. Foreign-sourced income earned before January 1, 2024, won't need to be declared in Thai tax returns, irrespective of when it’s brought into the country. This is very welcome news for expats. 

 

Having lost my mother in July, I am now due to receive money from the estate and as this counts as inheritance, is not subject to any taxation here. I am having this paid into my Thai bank account here along with the necessary paperwork to satisfy the RD. I was heavily advised not to put it into my UK bank account as this would then create a polluted account as my pensions are paid into that account. It then becomes very difficult to prove to the RD what is inheritance and what is not when I transfer money to Thailand. In fact there will be enough of the inheritance to keep us going over here so my pensions can remain in UK for when I visit there.

 

[The Cyclist]

Some people seem to have difficulty in understanding this

 

9 minutes ago, worrab said:

Question: If assessable income brought into Thailand was already taxed abroad and you bring that income back to Thailand, do you have to pay taxes again on this assessable income and end up paying double taxation?

 

Which is surprising as the answer is really simple

 

9 minutes ago, worrab said:

Answer: There is no double taxation in this case. If you are deemed a a tax resident of Thailand (staying in Thailand for  180 days or more), the tax paid abroad can be credited against the tax paid in Thailand in the tax year that assessable income was brought into Thailand according to the provisions of the Double Tax Treaty to which Thailand is a contracting party. 

 

Worst case scenario, I suspect I might need to go get a TIN and file an annual tax return for a lump sum of Baht 00000

[The Theory]

4 hours ago, Geir Rasch said:

So when you pay tax to Thailand your home country must reduce tax by deducting your taxable income

There is no tax for US income up to $12000. What is the max tax free in Thailand ? 

[worrab]

2 minutes ago, The Cyclist said:

Worst case scenario, I suspect I might need to go get a TIN and file an annual tax return for a lump sum of Baht 00000

You may well be right. You would have to fill in the form showing the income and then show the tax paid in UK? which would then give you credit against any tax that would be owed. 

 

It might be worth you contacting an advisor such as Carl Turner who would be able to advise you better than we can on a forum.  

[The Cyclist]

1 minute ago, worrab said:

You may well be right. You would have to fill in the form showing the income and then show the tax paid in UK? which would then give you credit against any tax that would be owed. 

 

It might be worth you contacting an advisor such as Carl Turner who would be able to advise you better than we can on a forum.  

 

I wont be doing anything until I hear the details from the original announcement which said something along the lines of " People / Income from Countries with a DTA with Thailand will be exempt "

 

In terms of any paperwork that might be required, my bases are covered with regards to income and tax paid in the UK.

 

[worrab]

On 11/25/2023 at 3:01 AM, BobBKK said:

I think a separate thread relating to the UK is very useful. I don't think those who are taxed in the UK, as I do, should lose sleep over this.

From what I can gather, I make you right. If you are remitting money here after Jan 1st 2024, then you still have to register, get a TIN and then file a self assesment. Because of the Dual Taxation Treaty there will be no tax to pay and this would be credited against any tax owed.  

[worrab]

3 minutes ago, The Cyclist said:

I wont be doing anything until I hear the details from the original announcement which said something along the lines of " People / Income from Countries with a DTA with Thailand will be exempt "

I think you would need to read this in context. You may well be exempt from paying taxes but you may need to still register and get a TIN?? I do not know hence checking with a Financial Advisor such as Carl Turner who is very clued up on the subject. He has actually had meetings with RD to get the correct information.  

[koolkarl]

5 hours ago, proton said:

Transfer to wife/family and yourself under the limit and bring cash in or use ATM no way I am paying these buggers tax on pensions and savings

Whoever received the inward remittance will have to report it on a Thai tax return including your Thai wife. Already in effect for 2023 which has to be reported by March or April 2024. 

[The Cyclist]

12 minutes ago, worrab said:

think you would need to read this in context. You may well be exempt from paying taxes but you may need to still register and get a TIN?

 

I agree that is the most likely scenario, which is why I said

 

33 minutes ago, The Cyclist said:

Worst case scenario, I suspect I might need to go get a TIN and file an annual tax return for a lump sum of Baht 00000

 

But it is not something I am going to lose any sleep over, neither am I making any plans to flee 

[proton]

19 minutes ago, koolkarl said:

Whoever received the inward remittance will have to report it on a Thai tax return including your Thai wife. Already in effect for 2023 which has to be reported by March or April 2024. 

Never done a tax return neither has the mrs

[Klonko]

19 minutes ago, koolkarl said:

Whoever received the inward remittance will have to report it on a Thai tax return including your Thai wife. Already in effect for 2023 which has to be reported by March or April 2024. 

Unless it is a gift up to THB 20m annually.

[proton]

57 minutes ago, Klonko said:

Unless it is a gift up to THB 20m annually.

what if it's stated as for charity or medical costs?

[Klonko]

1 hour ago, proton said:

what if it's stated as for charity or medical costs?

Gift to non spouses up to THB 10m annually. Medical costs not for yourself. I think it is wise to limit gifts to the spouse to ≤ 50% of joint current expenses. In addition, you can gift for investments in her name e.g. cars. Good to have a spouse you can fully trust into.

 

[Man Mart]

The ignorance of some comments about international taxation is just mind boggling. Some commentators appear oblivious that there are tax treaties and international conventions about sharing tax information between countries. Trying to put one’s head in the sand won’t work. https://www.oecd.org/tax/exchange-of-tax-information/convention-on-mutual-administrative-assistance-in-tax-matters.htm.

However, saying all that I am of the opinion that these proposed tax changes won’t be implanted within the proposed timescale and will be challenged in court. It is not reasonable to give only 3 months notice of such tax changes. 

[DrJack54]

This thread is hilarious.

Along with all the other threads same topic.

Who was the artist that sang "monsters under my Bed" 

Oh yes Everlast 

[Expat68]

8 hours ago, proton said:

I have never in my life filled in a tax return, never been sent one and the last P60 I got was when retired 17 years ago.

If you have income extra from the normal income, ie work, state pension then by law you have to fill in a tax return every year.

Some people may not realise that if you have rental property you have to fill in a form (your agent should send to you) HMRC visit every agen checking on property rented out

[Ben Zioner]

1 hour ago, DrJack54 said:

This thread is hilarious.

Along with all the other threads same topic.

Who was the artist that sang "monsters under my Bed" 

Oh yes Everlast 

Or?

[DrJack54]

36 minutes ago, Ben Zioner said:

Or?

Have read some of your nonsense posts..

This is another garbage 

[proton]

5 hours ago, Klonko said:

Gift to non spouses up to THB 10m annually. Medical costs not for yourself. I think it is wise to limit gifts to the spouse to ≤ 50% of joint current expenses. In addition, you can gift for investments in her name e.g. cars. Good to have a spouse you can fully trust into.

 

What about inheritance after husbands death leaving her a few million baht, is that taxed?

[Klonko]

16 hours ago, proton said:

What about inheritance after husbands death leaving her a few million baht, is that taxed?

No inheritance tax for spouse.

[Geir Rasch]

On 11/27/2023 at 2:15 PM, timendres said:

 

Nine years I did the same with my US taxes. But you do not deduct the income taxed.

You compute the taxes owed on the income, then subtract taxes paid here.

There is different system for US and Norway. What you describe is the normal rule for tax on salary split between two nations. But for pension there is a different system. The tax agreement betwenn Thai and Norway say that pension brought in to Thailand during the tax year can only be taxed be thai revenue dept. Then Norway must subtract pension taxed in Thailand from my total pension and calculate tax from the redused pension.

[Geir Rasch]

On 11/27/2023 at 2:32 PM, The Theory said:

There is no tax for US income up to $12000. What is the max tax free in Thailand ? 

Depend on your deduction. If you are 65 year or older you get a deduction of 190k. This in addition to minimum deduction of 100k and personal deduction of 60k. There are more deduction if you provid wife and children and if you have life/health insurance. So it is minimum 350k deduction, may be more. Then after deduction there is no tax on the first 150k bath. 
Normal I would say that your yearly income in Thailand must exeed 500k before there is any tax to pay. Then the tax is progressiv, starting at 5% for the first 150k.

[Mike Lister]

9 minutes ago, Geir Rasch said:

Depend on your deduction. If you are 65 year or older you get a deduction of 190k. This in addition to minimum deduction of 100k and personal deduction of 60k. There are more deduction if you provid wife and children and if you have life/health insurance. So it is minimum 350k deduction, may be more. Then after deduction there is no tax on the first 150k bath. 
Normal I would say that your yearly income in Thailand must exeed 500k before there is any tax to pay. Then the tax is progressiv, starting at 5% for the first 150k.

No, a person over age 65 would get the 190k deduction plus the personal allowance of 60,000 but that's it as far as allowances go. The first 150k of assessable income is zero rated so that's in addition to the 190k and 60k.

 

https://sherrings.com/personal-tax-deductions-allowances-thailand.html

[couchpotato]

43 minutes ago, Mike Lister said:

No, a person over age 65 would get the 190k deduction plus the personal allowance of 60,000 but that's it as far as allowances go. The first 150k of assessable income is zero rated so that's in addition to the 190k and 60k.

 

https://sherrings.com/personal-tax-deductions-allowances-thailand.html

Actually other allowances are RMF/LTF if you participate, and deduction for insurance premiums, plus spouse and other family deductions if applicable. I take all these plus the 190 and 60 mentioned above.

I also have other deductions, but they are specialised/individualised and are not applicable to all people.

[Mike Lister]

3 minutes ago, couchpotato said:

Actually other allowances are RMF/LTF if you participate, and deduction for insurance premiums, plus spouse and other family deductions if applicable. I take all these plus the 190 and 60 mentioned above.

I also have other deductions, but they are specialised/individualised and are not applicable to all people.

Yes, agreed. I just wanted to point out that the 100k deduction for retirees is erroneous.

 

[Geir Rasch]

On 11/29/2023 at 7:31 PM, Mike Lister said:

No, a person over age 65 would get the 190k deduction plus the personal allowance of 60,000 but that's it as far as allowances go. The first 150k of assessable income is zero rated so that's in addition to the 190k and 60k.

 

https://sherrings.com/personal-tax-deductions-allowances-thailand.html

You forget the deduction of category 1: 50% of income, max 100k.

[Mike Lister]

1 minute ago, Geir Rasch said:

You forget the deduction of category 1: 50% of income, max 100k.

I thought we were discussing retirees, people over age 65 years, in which case that deduction doesn't apply? 

[Yumthai]

2 hours ago, Mike Lister said:

I thought we were discussing retirees, people over age 65 years, in which case that deduction doesn't apply? 

 

Expense (50% but not exceeding 100K baht) deduction can be applied on Assessable Income Under Section 40 (1) Salary, wage, pension, etc. ; Section 40 (2) Meeting allowances, commissions, etc. ; Section 40 (3) Annuities from wills, other juristic act or court order, etc., Royalties, Goodwill, other rights

 

I understand it's max 100K deduction for Section 40 (1) (2) and again 100K for Section 40 (3) as per Personal Income Tax Return ภ.ง.ด.90 writing.

 

[Mike Lister]

3 minutes ago, Yumthai said:

 

Expense (50% but not exceeding 100K baht) deduction can be applied on Assessable Income Under Section 40 (1) Salary, wage, pension, etc. ; Section 40 (2) Meeting allowances, commissions, etc. ; Section 40 (3) Annuities from wills, other juristic act or court order, etc., Royalties, Goodwill, other rights

 

I understand it's max 100K deduction for Section 40 (1) (2) and again 100K for Section 40 (3) as per Personal Income Tax Return ภ.ง.ด.90 writing.

 

Is that not for expenses related to that income? What expenses are connected with expat overseas pensions other than contributions to a pension scheme? Thai Social Security contributions are deductible for example, because they are an expense from which the ultimate pension is derived but that deduction is from a salary or wage in Thailand, not a wage paid overseas. 

 

Have to say I've never heard anyone raise that before and I've been filing taxes here for several years and have had this chat about allowable deductions with RD several times in different ways. I'm pretty sure that it would have been mentioned previously, had it been allowable. If you can add further to this, I'll certainly listen.

[Geir Rasch]

4 hours ago, Mike Lister said:

I thought we were discussing retirees, people over age 65 years, in which case that deduction doesn't apply? 

Pension! 100k deduction on pension.