New Thai Tax On Remittances??

[Mike Lister]

2 minutes ago, Everyman said:

 

No

No

No

Nothing 

 

Wow that was easy. 

 

Unless the banks start withholding a portion of incoming transfers or immigration starts requiring tax documents for visa extensions, then the “new rules” do not matter, especially for people in your situation. And it will be a cold day in hell before either of those two scenarios happen. 

 

The revenue department probably has a few Thai “bad actors” in mind that they want to go after. Uncle Somchaj isn’t coming for anyone’s beer Chang fund. I also doubt they will try to tax incoming funds for condo purchases. 

 

It’s all a big juicy nothing burger with extra cheese, but the panic has been great business for dodgy tax lawyers peddling their own bull<deleted> interpretation of the supposed changes, and who have strong financial incentive to keep the panic going. 

There is already a law on the books requiring tax clearance certificates from foriegners, before they can extend their visa or leave the country, that law has not been actively enforced for years but it still exist.

[giogio]

3 minutes ago, Everyman said:

 

No

No

No

Nothing 

 

Wow that was easy. 

 

Unless the banks start withholding a portion of incoming transfers or immigration starts requiring tax documents for visa extensions, then the “new rules” do not matter, especially for people in your situation. And it will be a cold day in hell before either of those two scenarios happen. 

 

The revenue department probably has a few Thai “bad actors” in mind that they want to go after. Uncle Somchai isn’t coming for anyone’s beer Chang fund. I also doubt they will try to tax incoming funds for condo purchases. 

 

It’s all a big juicy nothing burger with extra cheese, but the panic has been great business for dodgy tax lawyers peddling their own bull<deleted> interpretation of the supposed changes, and who have strong financial incentive to keep the panic going. 

Before commenting on wishful thinking, i advice you to read this thread and the attached tax guide.

[Mike Lister]

5 minutes ago, fulhamster said:

This the main item that we are waiting to be decided. Until then it's all supposition

 

No, those dta's have been in place with people using them, for years. Links to them are on the RD we site.

[KannikaP]

1 minute ago, Mike Lister said:

There is already a law on the books requiring tax clearance certificates from foriegners, before they can extend their visa or leave the country, that law has not been actively enforced for years but it still exist.

So folks, make sure you take your Tax Clearance Certificated with you on your weekend to Cambodia or when you go to do your Retirement/Marriage Extension, just in case an Immigration Officer decides to enforce the current laws.

[Phulublub]

20 hours ago, KannikaP said:

I would argue that my State Pension comes from savings taken from my salary 50+ years ago

You can argue that, but would be utterly wrong.  Your payments to the Governmebt when you were working made to eligile for a pension.  There is no pot of gold being built up with your name on it.  What you paid in was, inpart, paid out to those drawing pensions at that time.  what you are now receving is being paid for by those paying tax now.   While it is classed as a benefit in the UK (not sure classification in other countries), it is taxable and is actually income.

 

PH

[Mike Lister]

9 minutes ago, KannikaP said:

So folks, make sure you take your Tax Clearance Certificated with you on your weekend to Cambodia or when you go to do your Retirement/Marriage Extension, just in case an Immigration Officer decides to enforce the current laws.

I was always required get one of these when I lived in the USA, they are very common.

[KannikaP]

8 minutes ago, Phulublub said:

You can argue that, but would be utterly wrong.  Your payments to the Governmebt when you were working made to eligile for a pension.  There is no pot of gold being built up with your name on it.  What you paid in was, inpart, paid out to those drawing pensions at that time.  what you are now receving is being paid for by those paying tax now.   While it is classed as a benefit in the UK (not sure classification in other countries), it is taxable and is actually income.

 

PH

Yes, you are correct, I was wrong. Money paid into a Pension Fund, be it State or Private is not taxed.

[Will B Good]

28 minutes ago, Everyman said:

or immigration starts requiring tax documents for visa extensions,

I can see that happening........it seems an obvious and easy avenue for them to pursue us and try to claim tax.

[EVENKEEL]

20 hours ago, Will B Good said:

I find that very confusing.....my pensions, rentals, dividends, interest payments etc.....all go into one bank account.....who is to say what comes to Thailand came from what savings???

Ditto, I'm just laughing at all this. Well, kind of

[Negita43]

5 hours ago, Mike Lister said:

I'm travelling currently, supposedly on a recuperative holiday and am I un able give one on one advice at present

Good thoughts for your full recuperation - take care

[Will B Good]

From the UK-Thailand Double Taxation Convention 1981.............

 

In the case of Thailand, United Kingdom tax payable in accordance with this Convention in respect of income from sources within the United Kingdom shall be allowed as a credit against Thai tax payable in respect of that income. The credit shall not, however, exceed that part of the Thai tax, as computed before the credit is given, which is appropriate to such item of income.

 

So if the tax we pay in the UK on our income is greater than the tax we would/might have to pay in Thailand on that income.......we pay no tax in Thailand......and if it is lower we just pay the difference?

 

Is that how it works?

[fulhamster]

3 minutes ago, Will B Good said:

From the UK-Thailand Double Taxation Convention 1981.............

 

In the case of Thailand, United Kingdom tax payable in accordance with this Convention in respect of income from sources within the United Kingdom shall be allowed as a credit against Thai tax payable in respect of that income. The credit shall not, however, exceed that part of the Thai tax, as computed before the credit is given, which is appropriate to such item of income.

 

So if the tax we pay in the UK on our income is greater than the tax we would/might have to pay in Thailand on that income.......we pay no tax in Thailand......and if it is lower we just pay the difference?

 

Is that how it works?

Hope not ... that way we could also be paying tax at both ends

[sirineou]

21 hours ago, Will B Good said:

I find that very confusing.....my pensions, rentals, dividends, interest payments etc.....all go into one bank account.....who is to say what comes to Thailand came from what savings???

I think that .It is not saving that are not taxables, but savings before 2024 regardless the source. 

Whatever  your 2023 year ending balance is your non taxable savings, everything after that you must pay tax on.  

for Americans where SSI and pensions are taxable only in the US, we have the variable that. What if your savings are as a result of your non taxable in Thailand SSI and pensions. 

I think it will become very interesting in the next years, 

Personally I will have my SSI  income transferred in Thailand. I have what I need for extensions already transferred and deposited in my account. 

I go back to the US at least once a year  as things are now, there is no law that I can not bring back $15,499 without reporting it. I think the same is true for my wife who is also a US citizen, I can live very well on $30,000 + my SSI income . 

We Had considered moving to Greece, but changed our mind because of the bureaucracy there, and that it was a lot easier to live in Thailand, but if the bureaucracy here becomes such that it is as difficult here as it is there, then we might have to reconsider moving to Greece. There a lot of positive in Greece over Thailand. Climate, proximity, language . food. 

 

 

[Phulublub]

7 minutes ago, Will B Good said:

From the UK-Thailand Double Taxation Convention 1981.............

 

In the case of Thailand, United Kingdom tax payable in accordance with this Convention in respect of income from sources within the United Kingdom shall be allowed as a credit against Thai tax payable in respect of that income. The credit shall not, however, exceed that part of the Thai tax, as computed before the credit is given, which is appropriate to such item of income.

 

So if the tax we pay in the UK on our income is greater than the tax we would/might have to pay in Thailand on that income.......we pay no tax in Thailand......and if it is lower we just pay the difference?

 

Is that how it works?

Broadly correct.  The whole point of a DTA is that you are only taxed once.   The devil in the detail though is that different areas may attract different rates - think income tax bands, CGT allowances etc - that muddy the water and make calculating outcomes a little difficult to generalise about.  The biggst potential for UK is the personal allowance is much higher there, so earn £12K and have no UK tax laibilty, but could have one here if all transferred gere.

 

PH

[Will B Good]

13 minutes ago, fulhamster said:

Hope not ... that way we could also be paying tax at both ends

But it says we can use the tax paid in the UK on UK income as a credit against any tax liabilities in Thailand???

[Will B Good]

10 minutes ago, sirineou said:

I go back to the US at least once a year  as things are now, there is no law that I can not bring back $15,499 without reporting it. I think the same is true for my wife who is also a US citizen, I can live very well on $30,000 + my SSI income

I think the tricky bit here is that you still have to, if you are being honest, report the cash brought in to the Thai tax authorities......you might not have to declare it at customs, true......

[Phulublub]

1 hour ago, KannikaP said:

Yes, you are correct, I was wrong. Money paid into a Pension Fund, be it State or Private is not taxed.

Anotehr way of looking at it - and comparing with, for example, ISAs...

 

ISA taxed on the way IN

Pension taxed on the way OUT

 

PH

[sirineou]

44 minutes ago, Will B Good said:

I think the tricky bit here is that you still have to, if you are being honest, report the cash brought in to the Thai tax authorities......you might not have to declare it at customs, true......

If I have one fault it's that I am too honest.My other one would be that I can not tell a lie. If it was not for that one cherry tree  I chopped down when I was a kid , I am sure I would be going to heaven when I die,  

[Lacessit]

11 minutes ago, sirineou said:

If I have one fault it's that I am too honest.My other one would be that I can not tell a lie. If it was not for that one cherry tree  I chopped down when I was a kid , I am sure I would be going to heaven when I die,  

Cicero said virtue is its own reward, we seem to have moved on from the Romans, when I look at some rich people.

[sirineou]

4 minutes ago, Lacessit said:

Cicero said virtue is its own reward, we seem to have moved on from the Romans, when I look at some rich people.

If I remember my university  philosophy classes There was a theory attributed to Nietzsche. That was so long ago that Nietzsche was still alive. 

Anyway he theorized that there are two types of people, Masters, and slaves, The slaves developed all sort of rationalizations to explained why they are not masters. 

 In Nikos Kazantzakis's  controversial book  the Last Temptation of Christ, on the cross as Christ is dying he  is hallucinating. And he sees himself sitting on the front porch of his house , field golden with  wheat, and his children happily playing with each other ,  thinking to himself 

" Good thing I gave up all this moralizing, and the idea of saving everyone else" 

And there my friend lay the rub. 

[giogio]

6 hours ago, Mike Lister said:

I'll reply later today

mike

 

when you have time, i would appreciate your opinion on "transferring to pay for services"

 

thnx

[Mike Lister]

5 hours ago, Will B Good said:

From the UK-Thailand Double Taxation Convention 1981.............

 

In the case of Thailand, United Kingdom tax payable in accordance with this Convention in respect of income from sources within the United Kingdom shall be allowed as a credit against Thai tax payable in respect of that income. The credit shall not, however, exceed that part of the Thai tax, as computed before the credit is given, which is appropriate to such item of income.

 

So if the tax we pay in the UK on our income is greater than the tax we would/might have to pay in Thailand on that income.......we pay no tax in Thailand......and if it is lower we just pay the difference?

 

Is that how it works?

That's broadly the case. And since UK tax starts at a much higher level than thai tax, anything already taxed there is unlikely to be taxed here.

[Mike Lister]

3 hours ago, giogio said:

mike

 

when you have time, i would appreciate your opinion on "transferring to pay for services"

 

thnx

I will need some more detail, services as in....? Anything that is then exported?

[StayinThailand2much]

On 1/20/2024 at 3:55 PM, giogio said:

Provincial Inland revenues have already been instructed by govnmt that remittances will be taxed according to certain criterias. 

 

That's kinda vague...

[Mike Lister]

10 hours ago, giogio said:

hi mike

 

i read almost religiously the "tax guide" you compiled

 

allow me to say:

-i wish you a full medical recovery (myself i have suddenly got the need of a knee surgery, which implies the transfer of 6k euros, on top of my usual yearly living costs)

-very grateful for your work for the community

-sorry that someone tailgated the thread and did not stop when he was made aware to stop.

 

now to my question:

if i pay a service in thailand directly from my european bank (either via fintech like WISE/XE or bank2bank), eg 1) i transfer the 6k required for my surgery directly from my eu bank to the thai hospital bank account. eg 2) to pay condo rent, i transfer directly from my eu bank to the thai landlord bank account.

 

the remittance would not arrive in thailand to my name nor to my bank account.

 

would these transfers be considered by thai inland revenue?

 

thank you

Ah, ok, I understand the services you referred to. Assuming you were tax resident when you acquired the service, the way in which you pay for them, directly or indirectly, doesn't alter the fact that you imported funds to do so. Same as if you used a debit card, from an overseas bank, you are importing funds from overseas to pay for something you received here in Thailand. If you ask me if that direct payment is more difficult to detect, yes of course it would be.

[CartagenaWarlock]

7 hours ago, Phulublub said:

You can argue that, but would be utterly wrong.  Your payments to the Governmebt when you were working made to eligile for a pension.  There is no pot of gold being built up with your name on it.  What you paid in was, inpart, paid out to those drawing pensions at that time.  what you are now receving is being paid for by those paying tax now.   While it is classed as a benefit in the UK (not sure classification in other countries), it is taxable and is actually income.

I don't know about the UK, but US FICA taxes are pre-tax deductions. That means you never paid any taxes on that money. In the US, only earnings from a Roth IRA are tax-free. But I'm not sure if Thailand will honor that unless it's specifically mentioned in the double taxation treaty (DTT). Social security is mentioned in DTT, and I believe the Thai government will honor that; otherwise, they will have a diplomatic row over that (not honoring DTT). 

Edited January 21 by CartagenaWarlock

[CartagenaWarlock]

I believe money brought to the country for investment (like buying a condo) or keeping 800K in the bank for extensions, etc. will be exempt from taxation.

[Phulublub]

1 hour ago, CartagenaWarlock said:

I believe money brought to the country for investment (like buying a condo) or keeping 800K in the bank for extensions, etc. will be exempt from taxation.

Is that a "feeling" or do you have some evidence that will be the case?

 

PH

[UKresonant]

10 hours ago, Will B Good said:

From the UK-Thailand Double Taxation Convention 1981.............

 

In the case of Thailand, United Kingdom tax payable in accordance with this Convention in respect of income from sources within the United Kingdom shall be allowed as a credit against Thai tax payable in respect of that income. The credit shall not, however, exceed that part of the Thai tax, as computed before the credit is given, which is appropriate to such item of income.

 

So if the tax we pay in the UK on our income is greater than the tax we would/might have to pay in Thailand on that income.......we pay no tax in Thailand......and if it is lower we just pay the difference?

 

Is that how it works?

Generally Yes.

But

UK will always have tax rights on a Government pension.

If you are in Thailand almost all the time year after.year, ThRD could claim priority taxing rights on some things, under article 4 of the DTA

Someone recently noted they asked their tax office, and they said ok with either way, which suggests some flexibility. 

Don't think it would work more than an initial year for dividends and interest and the like, as they are generally not taxed at source, and even dividends from ISA's (tax free in UK) would be taxed in Thailand if sent / remitted there. 

 

The bit you mention and DTA article 23 3) refers, to tax credit of UK tax against Thai Tax ( where applicable)

[giogio]

11 hours ago, Mike Lister said:

Ah, ok, I understand the services you referred to. Assuming you were tax resident when you acquired the service, the way in which you pay for them, directly or indirectly, doesn't alter the fact that you imported funds to do so. Same as if you used a debit card, from an overseas bank, you are importing funds from overseas to pay for something you received here in Thailand. If you ask me if that direct payment is more difficult to detect, yes of course it would be.

In a nutshell:

U answered all my red tape questions

 

in a concise nutshell:

thank you

 

to make a short story long:

during the night a user hinted at a personal decision over thailand/greece.

Not only in my opinion, the advantages of being in thailand have faded away or at the very least have shrunk to the point that i find my mind swaying by the hour (should i stay/should i go?)

 

In 10 dd my extension of stay expires.

 

Thank you mike and to all contributors