Legal Tax minimization for foreigners

[Mike Lister]

1 minute ago, Negita43 said:

As far as I am aware all Thai nationals if they fall within the taxation parameter should file a return but I think mnay do not.

I have edited your quote to remove my quote saying I had removed a post that discussed tax evasion.

[Foxx]

1 hour ago, Mike Lister said:

XE is a pretty large organization and very well respected. Do you have any evidence or links to the contrary on this issue?

 

XE is not tax specialists and has no special knowledge of Thailand.  The various Thai accountancy sites that I've previously looked at make no mention that money brought to Thailand is automatically liable for income tax.  For a start, it may not even be income, but rather capital.

[Mike Lister]

3 minutes ago, Negita43 said:

Mike if it's the post I'm thinking of (to which I replied). All it would do is tranfer the laibility for tax to the other person

Yep, possibly, but we're not going to go there.

[Negita43]

1 minute ago, Mike Lister said:

I have edited your quote to remove my quote saying I had removed a post that discussed tax evasion

No worries Mike you have enough to do as it is

 

[Mike Lister]

2 minutes ago, Foxx said:

 

XE is not tax specialists and has no special knowledge of Thailand.  The various Thai accountancy sites that I've previously looked at make no mention that money brought to Thailand is automatically liable for income tax.  For a start, it may not even be income, but rather capital.

XE is part of Euronet, the third largest currency exchange organization  in the world, I think we have to give them some credit for their expertise. But I agree the XE statement alone is not sufficient to guarantee correctness, which is why I asked if you have proof/links to the contrary rather than just a subjective view.

[Etaoin Shrdlu]

7 hours ago, zlodnick said:

My wife is a dual citizen, (US THAI), and a USSS recipient.

 

I read somewhere that USSS is tax exempt, EXCEPT, if the recipient is a Thai citizen.

 

Is there somewhere I can see if this is true?

 

My read of article 20 of the US-Thai DTA that specifically deals with social security, leads me to believe that anyone who is a US citizen cannot be taxed by Thailand for social security payments even if they also have Thai citizenship.There is no carve-back for Thailand to tax US citizens who also hold Thai citizenship in article 20.

 

Article 21 of the DTA deals with pension payments made by other governmental jurisdictions (federal, state, county city, etc) in consideration of past employment by those government entities. These pension payments are not social security payments, so I think that the carve-back in article 21 enabling Thai taxation on these payments to those who hold Thai citizenship is solely for these non-social security payments.

 

But that's just my opinion and I'm not a tax expert. Take a look at the DTA yourself and in particular articles 20 and 21.

[NanLaew]

22 minutes ago, Negita43 said:

Mike if it's the post I'm thinking of (to which I replied). All it would do is tranfer the laibility for tax to the other person

 

Yup, ALL my money's going into my wife's account.

 

When she gets assessed for income tax, I'll cut her a check.

 

Sorted.

[ukrules]

12 hours ago, Ben Zioner said:

Well it is quite simple.

 

a) minimise the amount of money, earned after December 2023, you are sending to Thailand,

b) stay no more the 179 days in Thailand in a given year,

c) combine a & b,

d) get an LTR visa.

 

 

 

Don't you mean, spend 179 or less days in Thailand and MAXIMISE the amount of money earned and remitted during the years where you spend less than 179 days.

 

I haven't quite decided if I will be taking a couple of 'long holidays' this year myself but I will do so in the next couple of months.

 

Then if I take the long holiday as I won't be a tax resident I can submit as much money as I want knowing that it's

 

1 Earned in 2024

2 Remitted in 2024

3 I am non resident in 2024

 

No need to apply for a TIN as non resident.

 

Same applies to any subsequent year

 

[EVENKEEL]

I'd have to guess there are a few homes  being built Isaan coming to a halt.

[ukrules]

4 hours ago, MistyBlue said:

This seems an appropriate thread to raise discussion on the following scenario.

 

Looking in to the future, say one is a Thai tax resident for 2024 and 2025 but remit none of the income made overseas.  In 2026 go traveling and only stay in Thailand for 5 months (under 180 days) and in that year remit the overseas income for 2024 and 2025, no return needed in 2026 as not tax resident for that year.  Then in 2027 stay more than 180 days and become tax resident again, the unknown (to me) is whether there would there be a liability for past income remitted into the country that was made when one was a tax resident.

 

I raise this because all the information I've found so far discusses income made and remitted when resident,  but not income made when resident but remitted when non-resident.

 

Maybe one to watch unfold in the future...

 

This exact scenario was discussed by a lawyer on a youtube video in a youtube channel named 'Canadian Working For You'

 

From memory he said that the money MUST be both 'made' or realised AND remitted in a year when you're not a tax resident to avoid being taxed on it. So sell your shares or house for tax free gains and send the money in the same year is the message but make sure you're not tax resident.

 

The idea was put forward that if you earn money after Jan 1, 2024 and are tax resident at the time of 'earning it' but in later years you remit it into Thailand then you will be taxed on it if it's not taxed at the same level already where it came from. If that's profit from a house sale where a lot of countries charge 0% then the difference between the home country and Thailand is going to be full income tax vs 0%

 

But maybe I don't remember 100% - so watch the video if you want.

 

The full video is 28 minutes long and is here :

 

[Phulublub]

2 hours ago, Foresttrump said:

I currently reside in the UK all income taxed by HMRC, I have O-A visa and visit Thailand 4 times a year but less than 180 days.  I live with my Thai partner of 7 years in our 2 bed condo in Bangkok when visiting, I send 60,000thb to her bank account via Wise each month to cover cost etc, will she need to file a tax return?

 

Absent any other information, it would appear that this is exactly the sort of "sending money home" that the new regime is tryign to tighten up on.  Does she work?  If so, then doesn;t she already complete a Thai tax return?

 

PH

[Ben Zioner]

1 hour ago, ukrules said:

 

Don't you mean, spend 179 or less days in Thailand and MAXIMISE the amount of money earned and remitted during the years where you spend less than 179 days.

 

I haven't quite decided if I will be taking a couple of 'long holidays' this year myself but I will do so in the next couple of months.

 

Then if I take the long holiday as I won't be a tax resident I can submit as much money as I want knowing that it's

 

1 Earned in 2024

2 Remitted in 2024

3 I am non resident in 2024

 

No need to apply for a TIN as non resident.

 

Same applies to any subsequent year

 

Ok, I apply my four points as follows:

• I have about 7.5 pre 2024 million to play with.
• I need about 3 million a year, in Thailand,
• This year (Jan 3)  I transferred all my 2024 income,
• The next tree years I'll transfer 1.5 million a year, which will be taxed, or not (I have the LTRWP),
• If and when it is confirmed that the LTR tax exemption is effective I'll transfer my savings again, if not I'll take a six months sabbatical somewhere in the fifth year to transfer my savings again. Over a every four year cycle I'll save 2 to 2.5 Million Baht in Taxes. More of course if LTR..

[NorthernRyland]

We really just need to wait and see how this unfolds. How much tax can they really get away with taking? The entire point of Thailand is that it's a budget retirement destination. If they start asking for numbers like 100k baht every year for taxes that will shift the entire agreement and the thing could blow up in their face. 

 

I could see it for digital nomads but there's not even a visa which fits the needs of the lower income people who come to Thailand anyways.

 

None of it makes sense given the reasons people come to Thailand in the first place so it's likely to fizzle imo.

[Foresttrump]

3 hours ago, Mike Lister said:

Please read the following since it's not a simple Yes No answer but is dependent on several factors. If you don't have your answer after reading it, please come back and ask any remaining questions. Thanks

 

Thanks Mike, I had a good read and as you say not a yes/no answer.  I am not a tax resident of Thailand at present but will be in May 2025.  I'm not trying to buck the system but was more interested in whether my Thia partner who is a permanent resident will have to file a tax return on money's I send her in the next financial year.

 

Doe's money you have earned and paid tax on then given to your partner/wife get taxed again, just because it's from an external source.  I think it will be decided by how they identify that it's from oversea's which will require the receiving bank to declare all oversea's deposits.  I will consult with a Thai accountant next time I'm in Bangkok and see what's best.

 

 

 

 

 

 

[CharlieKo]

4 hours ago, NanLaew said:

 

Yup, ALL my money's going into my wife's account.

 

When she gets assessed for income tax, I'll cut her a check.

 

Sorted.

I'm wondering if This is a loophole! If giving your wife these funds as a gift, would this negate having to pay income tax. As long as it's not more than 10,000,000 BHT it is free of any tax. There is no minimum. It's probably a long shot. 

[Mike Lister]

6 hours ago, Phulublub said:

Absent any other information, it would appear that this is exactly the sort of "sending money home" that the new regime is tryign to tighten up on.  Does she work?  If so, then doesn;t she already complete a Thai tax return?

 

PH

I think the typical profile the RD is going after is the person who invests in overseas markets using an offshore account and then repatriates profits that remain untaxed. 

[jerrymahoney]

9 hours ago, Foxx said:

 

XE is not tax specialists and has no special knowledge of Thailand.  The various Thai accountancy sites that I've previously looked at make no mention that money brought to Thailand is automatically liable for income tax.  For a start, it may not even be income, but capital.

None of those accountancy sites say that the Thai gift tax applies equally to domestic and foreign funds remitted, either.

 

... or that any of their mega-wealthy clients have actually made a foreign-sourced tax-free gift to Thailand since the Thailand gift-tax law was enacted FEB 2016. Based on what is suggested this and other topics, that shoulda been routine.

 

[Old Croc]

12 hours ago, jerrymahoney said:

Sending a large money transfer to Thailand? What to know about taxes

 

Xe Consumer -- February 1, 2021

 

Income Tax

 

The gift tax might or might not apply when you send money to Thailand, but the income tax almost always applies. 

 

https://www.xe.com/ar/blog/money-transfer/sending-a-large-money-transfer-to-thailand-what-to-know-about-taxes/

 

A bit difficult accepting advice from a company that gets their math so wrong (even allowing for a different exchange rate when published.)

 

From the XE link:

 

฿100 million THB (about $335,000 USD), 

฿20 million THB (about $67,000 USD)

[jerrymahoney]

11 minutes ago, Old Croc said:

 

A bit difficult accepting advice from a company that gets their math so wrong (even allowing for a different exchange rate when published.)

 

From the XE link:

 

฿100 million THB (about $335,000 USD), 

฿20 million THB (about $67,000 USD)

Looks like they maybe did leave out a zero each time.

 

I guess you can ignore their comments on foreign-sourced gifts and find some other 'reputable' firm to say that foreign sourced gifts to Thailand are tax free gift-tax or income tax.

 

But I will guess that Xe.com's comments were based on actual foreign transfers to Thailand especially since the page header is in Arabic.

[Old Croc]

21 minutes ago, jerrymahoney said:

Looks like they maybe did leave out a zero each time.

 

I guess you can ignore their comments on foreign-sourced gifts and find some other 'reputable' firm to say that foreign sourced gifts to Thailand are tax free gift-tax or income tax.

 

But I will guess that Xe.com's comments were based on actual foreign transfers to Thailand especially since the page header is in Arabic.

 

I was making comment on their astounding error considering the type of business they are in. I'm still considering how I will work around the tax conundrum. 

[jerrymahoney]

23 minutes ago, Old Croc said:

 

I was making comment on their astounding error Point taken. the type of business they are in. I'm still considering how I will work around the tax conundrum. 

Point taken 2x. Poor proof-reading on their part.

 

Still, my observation, regarding the tax-free foreign-sourced gift up to 20 million baht as per FEB 2016 ruling, is that if it is so patently-obvious as is discussed on here across several topics, why the big secret?

 

Why has not one blue-chip Bangkok-based tax law or accountancy firm discussed this as something since FEB 2016 their well-heeled clients use routinely as a gift tax free or income tax free option?

[gearbox]

20 hours ago, Ben Zioner said:

IMHO this will be seen as "tax evasion" by RD, if they catch you. One must be aware that they have all the relevant data at their disposal right now. However it is likely that, for a while, they won't have the capability to process that data. But if you gave it to me, I wouldn't have any problem in identifying people [cards] who make frequent withdrawals, all year, rank them, and deliver a list of likely culprits.

Whatever you state is simply not true. Withdrawing cash from ATM with a foreign debit card does not provide enough data to the Thai authorities to attribute the withdrawal to a specific person. The only entity that knows for sure that's you who got the money is your home country bank, and in many countries, including Australia these transactions are not reportable to the home revenue service (tax office) either.

[jerrymahoney]

8 minutes ago, gearbox said:

Whatever you state is simply not true. Withdrawing cash from ATM with a foreign debit card does not provide enough data to the Thai authorities to attribute the withdrawal to a specific person. The only entity that knows for sure that's you who got the money is your home country bank, and in many countries, including Australia these transactions are not reportable to the home revenue service (tax office) either.

I will agree that, for any time soon, an ATM withdrawal in Thailand from a foreign bank will be non-traceable to an expat in Thailand.

 

It will maybe come down to, if one ever files or has to file a Thai income tax form, are the amounts you actually claim as foreign remittances plausible.

[Presnock]

20 hours ago, Watchit said:

I for one will not at this stage be filing any tax returns. So far nobody has asked me to so why should i volunteer to and give the authorities ideas on how to increase their revenue with something which is really aimed at wealthy, tax dodging Thais.

 

If and only if things get said or obstacles are put in front of my wish to live here will i then look at ways to declare my income as non taxable in Thailand.

 

I fear once the first few farangs start unecessarily paying any tax then the tightening and implementing of rules will begin.

 

I've removed a recommendation to go against current tax law. Mike Lister, Moderator

What would be a help, anyone going to a revenue office should ask if the new policy would enable those WITHOUT assessible pensions/ss should not have to get a TN nor file a tax form each year.  Mainly, if we are still informed by the Revenue Office that we MUST get a TN if we meet the criteria for one and we MUST file a tax form even if the bottom line says "zero tax".  I can only imagine the folks in that office having to go through all those forms from those that do not have assessible income.  Even if they are online, it will still be quite odious and make them dislike some of us even more so in my opinion.

[Presnock]

18 hours ago, zlodnick said:

My wife is a dual citizen, (US THAI), and a USSS recipient.

 

I read somewhere that USSS is tax exempt, EXCEPT, if the recipient is a Thai citizen.

 

Is there somewhere I can see if this is true?

see articles 20 and 21 of the DTA between USA and Thailand

[Mike Lister]

2 minutes ago, Presnock said:

What would be a help, anyone going to a revenue office should ask if the new policy would enable those WITHOUT assessible pensions/ss should not have to get a TN nor file a tax form each year.  Mainly, if we are still informed by the Revenue Office that we MUST get a TN if we meet the criteria for one and we MUST file a tax form even if the bottom line says "zero tax".  I can only imagine the folks in that office having to go through all those forms from those that do not have assessible income.  Even if they are online, it will still be quite odious and make them dislike some of us even more so in my opinion.

I have included the issue of whether a nill return needs to be filed or not, at the end of the document, under the heading of unknow issues to be investigated.

[Mike Lister]

19 minutes ago, gearbox said:

Whatever you state is simply not true. Withdrawing cash from ATM with a foreign debit card does not provide enough data to the Thai authorities to attribute the withdrawal to a specific person. The only entity that knows for sure that's you who got the money is your home country bank, and in many countries, including Australia these transactions are not reportable to the home revenue service (tax office) either.

We've been thru this loop several times and the answer is very clear. When a person puts their card into an ATM overseas, the card number and the issuing bank become known to a whole series of entities, including, the bank that owns the ATM, the network that serves the ATM (Mastercard/visa)and the Thai central Bank (because a foreign currency transaction has been undertaken which must be reported to them). Those two pieces of data are sufficient to obtain the card owners name and other details, if a request was made and if the laws allowed (think CRS). All those entities need the information for their own reconciliation purposes and to provide a transaction reversal, if needed. None of this suggest that anyone will try to locate that information but as @Ben Zioner correctly states, it is easily doable.

[gearbox]

11 minutes ago, Mike Lister said:

We've been thru this loop several times and the answer is very clear. When a person puts their card into an ATM overseas, the card number and the issuing bank become known to a whole series of entities, including, the bank that owns the ATM, the network that serves the ATM (Mastercard/visa)and the Thai central Bank (because a foreign currency transaction has been undertaken which must be reported to them). Those two pieces of data are sufficient to obtain the card owners name and other details, if a request was made and if the laws allowed (think CRS). All those entities need the information for their own reconciliation purposes and to provide a transaction reversal, if needed. None of this suggest that anyone will try to locate that information but as @Ben Zioner correctly states, it is easily doable.

Whatever you wrote just confirms what I said. The card number and the issuer banks are known, and nothing else. A foreign government can make request to obtain the identity of the card owner only if serious criminal investigation is underway. Even the home countries revenue offices don't have access to this data. The CRS doesn't exchange data to such details, the AML agreements do, but in many countries like Australia the foreign ATM withdrawals do not need definitions of international fund transfer and are not captured.

 

[jerrymahoney]

1 hour ago, Presnock said:

What would be a help, anyone going to a revenue office should ask if the new policy would enable those WITHOUT assessible pensions/ss should not have to get a TN nor file a tax form each year. 

REDUX:

 

I agree that self-appraisal and self-assessment may be the only practical solution. But then the Thai Rev folks have to acknowledge that there will be (I will be polite) fudging of opinions as to what deductions and exemptions to which some expats claim they are entitled.

 

https://aseannow.com/topic/1306896-thai-government-to-tax-all-income-from-abroad-for-tax-residents-starting-2024/?do=findComment&comment=18605638

 

So if I want to say (to myself) that all my remittances this year are from an inheritance from my Aunt Dolores and thus not assessable for  Thai income tax purposes, does that mean I ever had to actually have an Aunt Dolores dead or living?

 

[Mike Lister]

28 minutes ago, gearbox said:

Whatever you wrote just confirms what I said. The card number and the issuer banks are known, and nothing else. A foreign government can make request to obtain the identity of the card owner only if serious criminal investigation is underway. Even the home countries revenue offices don't have access to this data. The CRS doesn't exchange data to such details, the AML agreements do, but in many countries like Australia the foreign ATM withdrawals do not need definitions of international fund transfer and are not captured.

 

I think we've all said broadly the same things, the identity of a card holder is capable of being found out but tracing them is the exception rather the rule, at present. Whether or not an investigation into tax evasion constitutes a serous crime is not unclear, I suppose it will depend on the scale and amounts of losses.