Investing offshore

[cdenn]

I think there is or at least used to be some way of investing offshore from Thailand and then bringing the investment income in in a different year so that it was not taxable.

 

Can anyone tell me how this is done, i.e. do you have to go through a specific bank or broker, what paperwork do they want to see to open an account etc.

 

I know there are tax changes in the pipeline BTW.

 

Thanks

[ChaiyaTH]

Just about having a bank account offshore, then you can connect that to any broker essentially. Common KYC documents will be passport, utility bill or bank statement for address proof etc. 

 

At eightcap you can actually even deposit with crypto, same for withdrawals. Even better.

Edited November 27, 2023 by ChaiyaTH

[cdenn]

5 hours ago, ChaiyaTH said:

Just about having a bank account offshore, then you can connect that to any broker essentially.

 

When you say offshore, would that typically be in your home country, or are there jurisdictions that will let you open a bank account without being a resident or citizen?

 

Is there no tax charged in the broker's jurisdiction then?

 

5 hours ago, ChaiyaTH said:

Common KYC documents will be passport, utility bill or bank statement for address proof etc. 

 

Is the KYC a one-time thing or would there be ongoing checks? I've been splitting my time between a few different countries over the last few years and have not spent long enough in any of them to become resident. As far as I know this means I can't open any type of investment account at the moment. I will turn 50 next year though, so the plan was to apply for a retirement visa and get access to investment facilities that way. I would probably go back to travelling around soon after though, so if they asked for proof of residence at a later time, it might be difficult to provide.

[Mike Lister]

The tax changes, effective 1 January 2024, mean that any profit that is brought into Thailand, regardless of when it is brought in, is taxable.

[cdenn]

1 minute ago, Mike Lister said:

The tax changes, effective 1 January 2024, mean that any profit that is brought into Thailand, regardless of when it is brought in, is taxable.

I know (tbh that's why I'm asking now, while it still makes sense for a lot of people) but those changes only apply to tax residents. I might be resident in the year when I got it all set up but not after that. One issue is whether that creates a risk of being debanked  / booted off the platform.

[Mike Lister]

2 minutes ago, cdenn said:

I know (tbh that's why I'm asking now, while it still makes sense for a lot of people) but those changes only apply to tax residents. I might be resident in the year when I got it all set up but not after that. One issue is whether that creates a risk of being debanked  / booted off the platform.

Many expats use Interactive Brokers in Luxembourg, it's not difficult to open an account there. Whether or not you can import funds from their into Thailand depends on whether or not you have a Thai bank account and whether or not the Thai Revenue will let you, without targeting you for tax. It's exactly that kind of transfer, from that sort of location that forms the basis of the new tax ruling.

[freedomnow]

16 minutes ago, Mike Lister said:

The tax changes, effective 1 January 2024, mean that any profit that is brought into Thailand, regardless of when it is brought in, is taxable.

Even if its been taxed already in the likes of the UK ?

I had been looking at passive income from overseas from rent which is taxed under UK law as an onshore UK income obviously.

 

Are we talking double taxation now ?

Edited November 27, 2023 by freedomnow

[Mike Lister]

I am tax resident in Thailand but I'm a Brit and have an investment account in the UK with Hargreaves Lansdowne. You can set up the account while you are in the UK and operate it from overseas, it works well for me and means I can transfer from the investment account, to my UK bank and fro there, to my Thai bank. I am not UK resident for tax.

[Mike Lister]

1 minute ago, freedomnow said:

Even if its been taxed already in the likes of the UK ?

I had been looking at passive income from overseas from rent which is taxed under UK law as an onshore UK income obviously.

 

Are we talking double taxation now ?

The scope and nature of the new tax change is very unclear, I don't want to speculate on what is or not included because those things are still unclear. FWIW I also have UK rental income which remains in the UK, I am not UK resident for tax.

[cdenn]

10 minutes ago, freedomnow said:

I had been looking at passive income from overseas from rent which is taxed under UK law as an onshore UK income obviously.

 

Are we talking double taxation now ?

There's a DTT between Thailand and the UK which expressly covers rent.

[cdenn]

10 minutes ago, Mike Lister said:

I am tax resident in Thailand but I'm a Brit and have an investment account in the UK with Hargreaves Lansdowne. You can set up the account while you are in the UK and operate it from overseas, it works well for me and means I can transfer from the investment account, to my UK bank and fro there, to my Thai bank. I am not UK resident for tax.

Do you worry that they will check if you're still resident in the UK? Or would you just give them proof of residence in Thailand? I am not resident in the UK so I don't think HL would let me open an account (looked at that before, admittedly a while back). 

[Mike Lister]

1 minute ago, cdenn said:

Do you worry that they will check if you're still resident in the UK? Or would you just give them proof of residence in Thailand? I am not resident in the UK so I don't think HL would let me open an account (looked at that before, admittedly a while back). 

You have to open the account whilst in the UK, otherwise they will close it if they find out you weren't. Once open you can operate it from anywhere worldwide. It's perhaps worthwhile opening one when back there on holiday, it's physical precessence at the time of opening that's important, not tax residency etc.

[Hamus Yaigh]

6 hours ago, cdenn said:

Can anyone tell me how this is done, i.e. do you have to go through a specific bank or broker, what paperwork do they want to see to open an account etc.

 

Do you actually have a bank account outside Thailand that isn't Wise or similar? In either case you can open an international account at any online broker overseas using usual KYC documents as mentioned in a matter of hours/days. Fund it with your bank and return profits to any bank as needed. Its easier if the bank is outside Thailand also, but a Thai bank that does international transfers out/in should work also.

[cdenn]

9 minutes ago, Mike Lister said:

You have to open the account whilst in the UK, otherwise they will close it if they find out you weren't. Once open you can operate it from anywhere worldwide. It's perhaps worthwhile opening one when back there on holiday, it's physical precessence at the time of opening that's important, not tax residency etc.

From their terms and conditions:

 

We offer a full range of services to UK residents and may be able to offer limited services where you are resident outside the UK. You must let us know if you are not, or cease to be, resident in the UK or the EEA and/or become resident in the USA. For these purposes you are deemed to be resident in a country if you have lived, or move with the intention of living, in that country for 12 months or more. We may not be able to offer some or all of our services to you if you cease to be resident in the UK. Those dealing with us from outside the UK may not be afforded UK legislative protections and should check their own state’s legislation and tax laws before undertaking a transaction with us.

 

More concretely (from the online help):

 

Can I still add money to my Fund and Share Account if I move abroad?
If you will be resident within the EEA (European Economic Area), then you can add money to, or apply for, an HL Fund and Share Account.

If you will be resident outside of these areas you will be able to retain your existing HL Fund and Share Account but you will not be able to add new money. However, you will still be able to place deals on your account as per our Terms and Conditions.

 

I don't think returns on this type of investment are covered by the DTT but assume HMRC would regard them as income arising in the UK because the platform is based in the UK, so currently taxable twice if brought in in the same year, no?

 

[freedomnow]

39 minutes ago, Mike Lister said:

The scope and nature of the new tax change is very unclear, I don't want to speculate on what is or not included because those things are still unclear. FWIW I also have UK rental income which remains in the UK, I am not UK resident for tax.

But your rental income does it not get taxed under UK laws as an onshore invesment ?

i'll have to halt the bus on a 2nd property investment to see what is what with this new tax law.

Been away from Thailand for a while due to "family stuff" back in UK...lovely brisk 1 degrees today..wakes you up at least going out the door !

[cdenn]

1 minute ago, Hamus Yaigh said:

 

Do you actually have a bank account outside Thailand that isn't Wise or similar? In either case you can open an international account at any online broker overseas using usual KYC documents as mentioned in a matter of hours/days. Fund it with your bank and return profits to any bank as needed. Its easier if the bank is outside Thailand also, but a Thai bank that does international transfers out/in should work also.

Yes, in the UK. The problem is that whenever I look at opening an account they ask me where I am tax resident and I can't truthfully tell them that I'm tax resident anywhere. I could arrange to be tax resident somewhere in the year I opened the account, but I'm concerned I'll run into problems if I cease to be tax resident at some later point (which is highly likely). That's why the idea of an offshore platform that doesn't care where you are tax resident was attractive. It's dawning on me now though that these aren't specialised brokers / platforms, they're the same platforms that everyone uses and it's just that if you have an account outside Thailand, there has been the option to have returns paid into that account and transfer them to Thailand in another tax year, avoiding Thai tax even if you're resident.

[Mike Lister]

10 minutes ago, cdenn said:

From their terms and conditions:

 

We offer a full range of services to UK residents and may be able to offer limited services where you are resident outside the UK. You must let us know if you are not, or cease to be, resident in the UK or the EEA and/or become resident in the USA. For these purposes you are deemed to be resident in a country if you have lived, or move with the intention of living, in that country for 12 months or more. We may not be able to offer some or all of our services to you if you cease to be resident in the UK. Those dealing with us from outside the UK may not be afforded UK legislative protections and should check their own state’s legislation and tax laws before undertaking a transaction with us.

 

More concretely (from the online help):

 

Can I still add money to my Fund and Share Account if I move abroad?
If you will be resident within the EEA (European Economic Area), then you can add money to, or apply for, an HL Fund and Share Account.

If you will be resident outside of these areas you will be able to retain your existing HL Fund and Share Account but you will not be able to add new money. However, you will still be able to place deals on your account as per our Terms and Conditions.

 

I don't think returns on this type of investment are covered by the DTT but assume HMRC would regard them as income arising in the UK because the platform is based in the UK, so currently taxable twice if brought in in the same year, no?

 

HL advised me in 2018 to open the account when I next visited the UK whilst on holiday so this wont be an issue for them.

 

No, you cannot add funds if not UK resident but you can be resident one minute and not resident the next hence adding funds before leaving is one solution.

 

Yes, the income will arise in the UK and based on the type of account, will be taxable there. But you have 12, 570 Pounds of UK personal allowance to use, before any UK tax is due.

 

 

 

 

[Mike Lister]

4 minutes ago, freedomnow said:

But your rental income does it not get taxed under UK laws as an onshore invesment ?

i'll have to halt the bus on a 2nd property investment to see what is what with this new tax law.

Been away from Thailand for a while due to "family stuff" back in UK...lovely brisk 1 degrees today..wakes you up at least going out the door !

Yes, but it falls within the UK personal allowance hence no UK tax is due

[Celsius]

I don't get it. 

 

People seem to be ready to do all kind of stupid things to avoid the tax.

 

Opening offshore accounts is risky. Crypto is risky. Have people not learned in the past few years...  not your keys, not your coins? 

 

You wanna risk losing access to funds for something as simple as KYC?

 

Stupid.

 

Just use your ATM and pay 220b tax. That's less than 1%.

[cdenn]

4 minutes ago, Mike Lister said:

HL advised me in 2018 to open the account when I next visited the UK whilst on holiday so this wont be an issue for them.

That's worth knowing, thanks.

 

5 minutes ago, Mike Lister said:

No, you cannot add funds if not UK resident but you can be resident one minute and not resident the next hence adding funds before leaving is one solution.

 

It's not easy to square that with "You must let us know if you are not, or cease to be, resident in the UK or the EEA and/or become resident in the USA. For these purposes you are deemed to be resident in a country if you have lived, or move with the intention of living, in that country for 12 months or more" though. I mean if it works then great and I'm not trying to dictate to anyone else, but I wouldn't be comfortable doing that.

 

My personal allowance is already used unfortunately (or fortunately, depending on how you look at it...)

[Mike Lister]

3 minutes ago, cdenn said:

That's worth knowing, thanks.

 

 

It's not easy to square that with "You must let us know if you are not, or cease to be, resident in the UK or the EEA and/or become resident in the USA. For these purposes you are deemed to be resident in a country if you have lived, or move with the intention of living, in that country for 12 months or more" though. I mean if it works then great and I'm not trying to dictate to anyone else, but I wouldn't be comfortable doing that.

 

My personal allowance is already used unfortunately (or fortunately, depending on how you look at it...)

I have a UK flat that I rent out and was using that address for HL. after a couple of years I said I was going to be visiting Thailand for a while and they said fine, I've been here for 20 years plus. Seriously, this aspect wont be a problem with HL. BUT you will not be able to take advantage pf tax refunds to fund pensions for example, which I think is one of the types of services they refer to for non UK residents.

[freedomnow]

7 hours ago, Mike Lister said:

Yes, but it falls within the UK personal allowance hence no UK tax is due

OK..and then do you expect to have that income tax in Thailand, if resident and it coming in through the banking system from UK ?

 

This new development is so messed up.

 

[Mike Lister]

4 hours ago, freedomnow said:

OK..and then do you expect to have that income tax in Thailand, if resident and it coming in through the banking system from UK ?

 

This new development is so messed up.

 

It depends on various factors such as the amount of tax free free head room that I have on the Thai side in any given year. It will also depend on my financial needs and my willingness to pay Thai tax on those funds. One option is to leave the money in the UK and use it to fund holidays there and elsewhere. Another is to bring some of it back in cash when I travel. I'm not opposed to paying Thai tax at 5% but I become more so as the rate to higher tax bands. Fortunately I'm in no rush since I have several years living expenses on hand.

[freedomnow]

29 minutes ago, Mike Lister said:

It depends on various factors such as the amount of tax free free head room that I have on the Thai side in any given year. It will also depend on my financial needs and my willingness to pay Thai tax on those funds. One option is to leave the money in the UK and use it to fund holidays there and elsewhere. Another is to bring some of it back in cash when I travel. I'm not opposed to paying Thai tax at 5% but I become more so as the rate to higher tax bands. Fortunately I'm in no rush since I have several years living expenses on hand.

I guess spending of a card like WISE is technically bypassing on-shoring that money as it just goes directly into purchases after being deposited in the UK wise account and converted to Thai Baht on the wise internal currency conversion system...and hopefully it is as simple as that for living costs on tap not attracting this new tax.

Edited November 27, 2023 by freedomnow

[Mike Lister]

28 minutes ago, freedomnow said:

I guess spending of a card like WISE is technically bypassing on-shoring that money as it just goes directly into purchases after being deposited in the UK wise account and converted to Thai Baht on the wise internal currency conversion system...and hopefully it is as simple as that for living costs on tap not attracting this new tax.

That would be doable but bot entirely practical or desirable for the long term. Many places here will want to impose a surcharge on card spending, they do that even on debit cards in some places! Plus if the volume and amount of transactions gets to a high level, WISE may have something to say.

[AgMech Cowboy]

If you want to lose money, then use those offshore investment companies and banks. They talk a good game, but it's all a big scam.

[topt]

36 minutes ago, AgMech Cowboy said:

If you want to lose money, then use those offshore investment companies and banks. They talk a good game, but it's all a big scam.

A bit of a generalisation............

I have both so please tell me how I am being scammed or give us some examples..........

[khunPer]

On 11/27/2023 at 3:44 AM, cdenn said:

I think there is or at least used to be some way of investing offshore from Thailand and then bringing the investment income in in a different year so that it was not taxable.

 

Can anyone tell me how this is done, i.e. do you have to go through a specific bank or broker, what paperwork do they want to see to open an account etc.

 

I know there are tax changes in the pipeline BTW.

 

Thanks

Probably not possible anymore from 1st January 2024, but details are still missing...

 

Otherwise, the system is that you have any kind of offshore income a place where it's not locally taxed – which might depend of your country of origin – and just leave any income/profits from one year to the next, or any later year, where it's magically has been transformed from income to saving from a Thai point of view. Savings is/was until 31st December 2023 free of income tax when transferred into Thailand. Unfortunately we don't know at present, exactly what happens after that date...

 

Offshore investments can be done by many means. You might be able to open an offshore account with an attached stock market and currency trading platform – for example from Saxo Bank (link is for Singapore, it's a Danish investment bank with multiple local branches) or – depending of your country of origin – use a home country bank and trading platform, if your home country don't tax capital gains. Some countries also have a Double Taxation Agreement with Thailand, which might reduce dividend tax to 10 percent; note that here you need to transfer the dividends into Thailand in the same year as it's earned, and declare the dividends in your Thai tax return form...

[khunPer]

1 hour ago, AgMech Cowboy said:

If you want to lose money, then use those offshore investment companies and banks. They talk a good game, but it's all a big scam.

No, I make a good return – this year so far +26% – but I use a trading platform and invest myself in selected stocks.

[cdenn]

59 minutes ago, khunPer said:

Probably not possible anymore from 1st January 2024, but details are still missing...

 

Otherwise, the system is that you have any kind of offshore income a place where it's not locally taxed – which might depend of your country of origin – and just leave any income/profits from one year to the next, or any later year, where it's magically has been transformed from income to saving from a Thai point of view. Savings is/was until 31st December 2023 free of income tax when transferred into Thailand. Unfortunately we don't know at present, exactly what happens after that date...

 

Offshore investments can be done by many means. You might be able to open an offshore account with an attached stock market and currency trading platform – for example from Saxo Bank (link is for Singapore, it's a Danish investment bank with multiple local branches) or – depending of your country of origin – use a home country bank and trading platform, if your home country don't tax capital gains. Some countries also have a Double Taxation Agreement with Thailand, which might reduce dividend tax to 10 percent; note that here you need to transfer the dividends into Thailand in the same year as it's earned, and declare the dividends in your Thai tax return form...

Thanks, that makes sense. I don't think it matters all that much whether it's treated as income or savings because I won't normally be tax resident in Thailand anyway. I looked at the Saxo link but again it asks you for your country of residence and I don't have one (not tax resident anywhere, no right of residence outside the UK, spend no time in the UK, have no home there). The more I think about it the more the issue is not knowing what to put for that question / not knowing what the consequences would be if they decided, maybe several years down the line, that whatever I had put was wrong and the account should never have been opened. I can arrange to be resident in Thailand next year because I will be eligible for a retirement visa, but it's not clear whether this is really necessary just to open an investment account, and anyway it would just be for that one year. Might they come back and check I was still resident in a later year? What would they do if they found that I wasn't? In the meantime, would they report the income to the Thai tax agency, and would that cause a problem given I wouldn't be putting in a tax return? So many unknowns.