Tax seminar at US Embassy with Thailand American Chamber of Commerce

[Presnock]

I sat through the seminar on the up coming 2024 tax on income remitted into Thailand

  Based on the speakers, this is still in the discussion mode of the Thai Government so whatever was mentioned today, could change.  What the speakers did say is that the local banks and the other banks around the world are using the "common Reporting Standard" meaning that if you have a Thai bank account, your country can share anything dealing with your account and Thailand can share your local account with your

home country.  Starting in 2024, any money remitted into Thailand, be it via foreign bank to local bank, foreign govt offices to Thai bank, pension funds, retirement funds etc, could be considered for Thai income tax if you are incountry 180 days or more of the calendar year.   However, if one wants to bring/send money to buy a condo for example, and that money was earned prior to 2024, then it would not be taxed.  The speakers said several times to keep copies of all documentation dealing with your foreign and local banks and money transactions.  The Thai side reportedly is still working on foreign credit cards and ATM use but seemed by the speakers that those too will eventually be taxable.  They mentioned Digital Nomads need work permits and that their earnings will probably be taxed, no matter where they send the money earned since they are earning it in Thailand.  They mentioned DTA's with 51 other countries and every one could be different and one needs to study their particular home country DTA to actually find out what that might mean with taxes and tax exemptions.  They said that pensions from abroad could probably be given "tax credit" in Thailand but that documentation of earnings/payments will be needed.  Money sent via Wise or other services will need to pay taxes on all sent unless it falls into some other category.   Even bringing in cash could be taxed.  Basically, what I got from the hour-long seminar was that the Thai government is still meeting regularly and that nothing is totally concrete yet except ANY income from employment, pensions, pers services, contracts whether paid outside or inside Thailand by a person considered as a tax resident  willl be considered to be earned income.  Basically, I don't feel that I learned exactly what will happen beginning next year as the committee dealing with all this meets regularly and discusses whatever they learned  during the break time.  I am on a government pension, and at the very least, I can get reimbursed if the Thais do tax the money I send here but would rather they just give me a tax credit after I show the yearly/monthly payments and taxes already paid out.  So, I guess like the rest of you, I will just have to wait to see what the final version will be.  They mentioned that if you are a tax resident then you should get a Thai tax id number and that everyone should keep records of all their financial dealings.  Good luck!

[jaideedave]

I foresee a bureaucratic nightmare on the horizon. Another useless paper copying exercise aka visa renewals and lets throw in translation services.

 

In my case as a non resident of Canada my pensions are subjected to a 25% withholding tax.

However because my income is below a certain threshold my income is tax excempt. I pay zero taxes. (Form NR5)

How do I convince Somchai or Noi at RD about this legal decision?

I do have the letter stating this fact but thats all.

Fingers crossed this whole thing just fades away.

 

[VillageIdiot]

As in the USA there will be loop-holes, bolt-holes, and bung-holes for the wealthy and well-connected to go into.

Leona Helmsley nailed it a long time ago when she said "Only the little people pay taxes."

[Presnock]

if your pension is not taxed in Canada but does meet Thai tax table then the Thais will probably tax any money you send beginning Jan 1 2024, But like I said above, they are still trying to finalize the law.  

Based on what I heard on the 15th, the Thais are meeting regularly to work out all the details on this tax.  Also, since 61 countries have a DTA with Thailnd, they didn't go into anything about those but advised that individuals should check out their country's DTA for details.  Just google "DTA between your country and Thailand."  As for the USA our DTA indicates that the Thais will most likely provide a "tax credit" for any taxes we pay on our income of all types.  This most likely means that at the end of the Tax Year, we will have to provide a W2 showing income received and taxes paid on that amount.  BUT as I and others plus these 3 Embassy seminar speakers continue to advise that nothing is final until the final is written and signed off by a Royal Decree.  

[EVENKEEL]

They failed to make money on legalized weed tax. Can you imagine the nightmare if they move forward with this nonsense.

[Presnock]

8 minutes ago, EVENKEEL said:

They failed to make money on legalized weed tax. Can you imagine the nightmare if they move forward with this nonsense.

The seminar speakers also mentioned that they want to tax ALL income one recieves during the tax year, not only that remitted into Thailand and that they were also talking about credit card use and ATM withdrawals.  Since the countries with a DTA will supposedly exchange info on one's income, who knows where it will stop or begin? Have a healthy and happy holiday season

[Presnock]

On 12/15/2023 at 11:10 AM, jaideedave said:

I foresee a bureaucratic nightmare on the horizon. Another useless paper copying exercise aka visa renewals and lets throw in translation services.

 

In my case as a non resident of Canada my pensions are subjected to a 25% withholding tax.

However because my income is below a certain threshold my income is tax excempt. I pay zero taxes. (Form NR5)

How do I convince Somchai or Noi at RD about this legal decision?

I do have the letter stating this fact but thats all.

Fingers crossed this whole thing just fades away.

 

Check out your country's DTA with Thailand - if they don't tax it, and it meets the Thai threshold then the Thais most ikely can legally tax those funds.

[JimGant]

On 12/15/2023 at 11:10 AM, jaideedave said:

In my case as a non resident of Canada my pensions are subjected to a 25% withholding tax.

However because my income is below a certain threshold my income is tax excempt. I pay zero taxes. (Form NR5)

How do I convince Somchai or Noi at RD about this legal decision?

 

According to the Thai-Canada tax treaty, Canada has exclusive taxation rights on both government and private pensions:

Quote

1. Pensions and other similar remuneration, whether they consist of periodic or non-periodic payments, for past employment, arising in a Contracting State and paid to a resident or the other Contracting State shall be taxable only in the first-mentioned State.

2. For the purpose of paragraph 1 such remuneration for past employment shall be deemed to arise in a Contracting State if the payer is that State itself, a political subdivision, a local authority or a resident of that State.

https://www.canada.ca/en/department-finance/programs/tax-policy/tax-treaties/country/thailand-convention-1984.html

 

Thus, per treaty, your Canadian pension(s) are not "assessable (taxable) income" for Thai tax purposes, and thus there would be no reason to file a Thai tax return showing such income strictly for information purposes. At least under current guidance. 

[DrPhibes]

22 hours ago, VillageIdiot said:

As in the USA there will be loop-holes, bolt-holes, and bung-holes for the wealthy and well-connected to go into.

Leona Helmsley nailed it a long time ago when she said "Only the little people pay taxes."

Where upon after that statement, she was sent to prison for tax evasion.  Look it up ;-)

[jaideedave]

23 minutes ago, JimGant said:

 

According to the Thai-Canada tax treaty, Canada has exclusive taxation rights on both government and private pensions:

 

Thus, per treaty, your Canadian pension(s) are not "assessable (taxable) income" for Thai tax purposes, and thus there would be no reason to file a Thai tax return showing such income strictly for information purposes. At least under current guidance. 

JG..thanks so much for clarifying this for me. I've tried to decipher the gov't docs and my "cognitive function" cells shut down.

That gives me peace of mind for now. cheers

[jaideedave]

7 hours ago, Presnock said:

Check out your country's DTA with Thailand - if they don't tax it, and it meets the Thai threshold then the Thais most ikely can legally tax those funds.

1. Pensions and other similar remuneration, whether they consist of periodic or non-periodic payments, for past employment, arising in a Contracting State and paid to a resident or the other Contracting State shall be taxable only in the first-mentioned State.

2. For the purpose of paragraph 1 such remuneration for past employment shall be deemed to arise in a Contracting State if the payer is that State itself, a political subdivision, a local authority or a resident of that State.

https://www.canada.ca/en/department-finance/programs/tax-policy/tax-treaties/country/thailand-convention-1984.html

[Presnock]

1 hour ago, jaideedave said:

1. Pensions and other similar remuneration, whether they consist of periodic or non-periodic payments, for past employment, arising in a Contracting State and paid to a resident or the other Contracting State shall be taxable only in the first-mentioned State.

2. For the purpose of paragraph 1 such remuneration for past employment shall be deemed to arise in a Contracting State if the payer is that State itself, a political subdivision, a local authority or a resident of that State.

https://www.canada.ca/en/department-finance/programs/tax-policy/tax-treaties/country/thailand-convention-1984.html

GOOD ON CANADA.  HOPE IT WORKS FOR YOU AND YOUR FELLOW EX-PATS

[Presnock]

1 hour ago, jaideedave said:

JG..thanks so much for clarifying this for me. I've tried to decipher the gov't docs and my "cognitive function" cells shut down.

That gives me peace of mind for now. cheers

THIS EXPLANATION FOR THE CANADIAN EX-PATS IS THE PERFECT REASON OR ALL TO CHECK ANY DTA YOUR COUNTRY HAS WITH THAILAND

[VillageIdiot]

3 hours ago, DrPhibes said:

Where upon after that statement, she was sent to prison for tax evasion.  Look it up ;-)

That's true.

However, Leona went to jail because she had the audacity to tell the truth about those who pay taxes and those who get a free ride.

That quote (to her housekeeper) came out in open court and sealed her fate.

That conclusion is often questioned, but how many other high-profile tax cases involving zillionaires result in prison sentences?

If they do, it is usually a matter of months in some posh Club Fed.

[Presnock]

2 hours ago, Presnock said:

THIS EXPLANATION FOR THE CANADIAN EX-PATS IS THE PERFECT REASON OR ALL TO CHECK ANY DTA YOUR COUNTRY HAS WITH THAILAND

Yeah, I originally asked a tax prep consultant about this and they told me that the govt of residence could tax my US govt pension but that then I would be give a tax credit in the difference between the two tax charts.  I checked the DTA today, Article 20 states the same as the Canadian DTA, that

state pensions could only be taxed by the state that pays that pension. i.e. the US govt. so I we shouldn't have to pay any tax to the Thai govt but only show them (in my case) a copy of the pension yearly chart or my W2's showing how much my pension for the year was and the tax with held.  But, TIT and listening to someone like on a video on "Thai Examiner.com", who knows what the final will look like.  Happy Holidays to all

[Wrwest]

On 12/15/2023 at 11:10 AM, jaideedave said:

I foresee a bureaucratic nightmare on the horizon. Another useless paper copying exercise aka visa renewals and lets throw in translation services.

 

In my case as a non resident of Canada my pensions are subjected to a 25% withholding tax.

However because my income is below a certain threshold my income is tax excempt. I pay zero taxes. (Form NR5)

How do I convince Somchai or Noi at RD about this legal decision?

I do have the letter stating this fact but thats all.

Fingers crossed this whole thing just fades away.

 

I am in a relative same boat. USA Social Security plus withdrawals from retirement savings fund. All subject to USA income tax. But my annual total falls below taxation levels so there are no taxes owed to Uncle Sam. All these retirement funds were earned based on income from previous years. I am hoping that the USA tax treaty between the USA and Thailand will preclude any taxation of income that I am required to bring into Thailand (at 65K a month). I can envision a diplomatic issue here.

[jaywalker2]

Looks like the worst case scenario is about to come true.

[Kinnock]

Thai nations fall into one of two tax categories:

1. Earn too little to pay income tax

2. Earn too much to pay any tax

So foreigners and foreign companies in Thailand are their only hope of getting any tax revenue.

[Moonlover]

21 minutes ago, jaywalker2 said:

Looks like the worst case scenario is about to come true.

Only applies to pessimists.

[beautifulthailand99]

39 minutes ago, Moonlover said:

Only applies to pessimists.

On Spike Milligan's grave is the inscription in Galeic I told you I was ill!

[JimGant]

1 hour ago, Wrwest said:

I am in a relative same boat. USA Social Security plus withdrawals from retirement savings fund. All subject to USA income tax. But my annual total falls below taxation levels so there are no taxes owed to Uncle Sam. All these retirement funds were earned based on income from previous years. I am hoping that the USA tax treaty between the USA and Thailand will preclude any taxation of income that I am required to bring into Thailand (at 65K a month). I can envision a diplomatic issue here.

 

I assume your "retirement savings fund" is an IRA, 401k, similar. And, unlike Canadians, the US does not have exclusive taxation rights on private pensions and IRA type programs. So, Thailand has priority taxation rights on your IRA -- but, not your Social Security. So, if remitted, your IRA would be subject to a Thai tax filing. As there's probably no other income to include, maybe after allowances, that IRA would be little enough not to be taxable. If not, it probably wouldn't be much. However, as you say you wouldn't owe any US tax on this, the Thai tax credit would be for nought.

[Presnock]

14 hours ago, Wrwest said:

I am in a relative same boat. USA Social Security plus withdrawals from retirement savings fund. All subject to USA income tax. But my annual total falls below taxation levels so there are no taxes owed to Uncle Sam. All these retirement funds were earned based on income from previous years. I am hoping that the USA tax treaty between the USA and Thailand will preclude any taxation of income that I am required to bring into Thailand (at 65K a month). I can envision a diplomatic issue here.

Read the DTA with Thailand, article 20 talks about pensions etc