Personal Income Tax Guide (for foreigners) Thailand

[aussienam]

On 3/30/2024 at 12:05 PM, JimTripper said:

 

Why risk it? Singapore banks are much more stable.

I heard there may be a potential loophole to exploit by remitting funds from abroad via Singapore Bank account  (maybe some complex structures in Singapore to set up first). 

 

Edited March 31 by aussienam

[aussienam]

On 1/11/2024 at 10:24 PM, NoDisplayName said:

 

So, let's say Person X has a baseline statement from Dec 31, 2023 with a balance of $1 million.

 

Does this mean Person X can transfer into Thailand any of this amount free of tax?  And for how long?  Can X bring in $100K each year for the next ten years tax free, by showing the 2023 base balance along with a sum total of all monies transferred in until exhausted?

And what about, if instead of having $1 Million as a baseline amount in a savings account in a bank,  in your foreign country with DTA, only since before 31 Dec 2023, you had $1 Million worth of investments instead?  And you are slowly liquidating those investments to remitt to Thailand for living and/or property purchase expenses?  Can we try to show that the liquidated portions of those investments remitted to Thailand are untaxable as they were derived before 31 Dec 2023?  

If I bought my property in Oz in 2017 and sell it in 2028, can I claim the base capital investment amount plus any estimated capital gains made up to 31 Dec 2023 are tax free if sale proceeds are remitted to Thailand?

 

And how would you prove a historical property estimate on a property without an official valuation certificate up to 31 Dec 2023?  Is this something I should have done?

 

SOLUTION TO AVOID/MITIGATE THIS BS:

 

Or, do we do this as the future way of living in Thailand: everytime we want to transfer a large sum of money into Thailand, we leave Thailand for over the 6 months in that year, take up residence and rent for that period in Cambodia, Phillipines, LAOS, Vietnam, etc so we are deemed non-residents (never know you may decide to not come back.  And will likely p*ss off a lot of couples and strain marriages and families from absent expats doing their 'time' elsewhere).

 

Then come back to Thailand and remit that money into a Thai bank account. Thailand loses out on my spending in Thailand for 6 months.  Bank doesn't make profit on my deposit money as it isn't in Thailand, until I probably remit it near my return, and I avoid the residence foreign remittance tax. 

 

The f***ed thing though is i don't generally want to transfer large sums into Thailand at once because interest rates here are virtually zero % in banks.  Totally pathetic. Making heaps more interest in my home country in investments and even bank account.  No incentive to bring large amounts into Thailand in one large amount for living expenses.  But these allegedly to be enforced residence based hefty taxes change the goal posts.  Lose-lose scenario just to keep living here. 

So, buying a condo.  Leave the damn country for over ½ the year, transfer the money when a non-resident and come back to buy it tax free.  Or pay up to 35% BS tax. Or better still -never buy a property in Thailand or any other big ticket item.  

Edited March 31 by aussienam
Added details

[Mike Lister]

2 hours ago, aussienam said:

And what about, if instead of having $1 Million as a baseline amount in a savings account in a bank,  in your foreign country with DTA, only since before 31 Dec 2023, you had $1 Million worth of investments instead?  And you are slowly liquidating those investments to remitt to Thailand for living and/or property purchase expenses?  Can we try to show that the liquidated portions of those investments remitted to Thailand are untaxable as they were derived before 31 Dec 2023?  

If I bought my property in Oz in 2017 and sell it in 2028, can I claim the base capital investment amount plus any estimated capital gains made up to 31 Dec 2023 are tax free if sale proceeds are remitted to Thailand?

 

And how would you prove a historical property estimate on a property without an official valuation certificate up to 31 Dec 2023?  Is this something I should have done?

 

SOLUTION TO AVOID/MITIGATE THIS BS:

 

Or, do we do this as the future way of living in Thailand: everytime we want to transfer a large sum of money into Thailand, we leave Thailand for over the 6 months in that year, take up residence and rent for that period in Cambodia, Phillipines, LAOS, Vietnam, etc so we are deemed non-residents (never know you may decide to not come back.  And will likely p*ss off a lot of couples and strain marriages and families from absent expats doing their 'time' elsewhere).

 

Then come back to Thailand and remit that money into a Thai bank account. Thailand loses out on my spending in Thailand for 6 months.  Bank doesn't make profit on my deposit money as it isn't in Thailand, until I probably remit it near my return, and I avoid the residence foreign remittance tax. 

 

The f***ed thing though is i don't generally want to transfer large sums into Thailand at once because interest rates here are virtually zero % in banks.  Totally pathetic. Making heaps more interest in my home country in investments and even bank account.  No incentive to bring large amounts into Thailand in one large amount for living expenses.  But these allegedly to be enforced residence based hefty taxes change the goal posts.  Lose-lose scenario just to keep living here. 

So, buying a condo.  Leave the damn country for over ½ the year, transfer the money when a non-resident and come back to buy it tax free.  Or pay up to 35% BS tax. Or better still -never buy a property in Thailand or any other big ticket item.  

There are several threads in the Australian home country forum that are specific to Australians, linked below is one such thread. Please do not post Australian specific issues here since they will not be well responded to and the thread is reserved for known fact rather than debate. Thanks. Note: non-relevant posts will be deleted periodically, in order to keep the thread readable for new commers.

 

 new commers.

[UKresonant]

5 hours ago, aussienam said:

And what about, if instead of having $1 Million as a baseline amount in a savings account in a bank,  in your foreign country with DTA, only since before 31 Dec 2023, you had $1 Million worth of investments instead?  And you are slowly liquidating those investments to remitt to Thailand for living and/or property purchase expenses?  Can we try to show that the liquidated portions of those investments remitted to Thailand are untaxable as they were derived before 31 Dec 2023?  

If I bought my property in Oz in 2017 and sell it in 2028, can I claim the base capital investment amount plus any estimated capital gains made up to 31 Dec 2023 are tax free if sale proceeds are remitted to Thailand?

 

And how would you prove a historical property estimate on a property without an official valuation certificate up to 31 Dec 2023?  Is this something I should have done?

 

SOLUTION TO AVOID/MITIGATE THIS BS:

 

Or, do we do this as the future way of living in Thailand: everytime we want to transfer a large sum of money into Thailand, we leave Thailand for over the 6 months in that year, take up residence and rent for that period in Cambodia, Phillipines, LAOS, Vietnam, etc so we are deemed non-residents (never know you may decide to not come back.  And will likely p*ss off a lot of couples and strain marriages and families from absent expats doing their 'time' elsewhere).

 

Then come back to Thailand and remit that money into a Thai bank account. Thailand loses out on my spending in Thailand for 6 months.  Bank doesn't make profit on my deposit money as it isn't in Thailand, until I probably remit it near my return, and I avoid the residence foreign remittance tax. 

 

The f***ed thing though is i don't generally want to transfer large sums into Thailand at once because interest rates here are virtually zero % in banks.  Totally pathetic. Making heaps more interest in my home country in investments and even bank account.  No incentive to bring large amounts into Thailand in one large amount for living expenses.  But these allegedly to be enforced residence based hefty taxes change the goal posts.  Lose-lose scenario just to keep living here. 

So, buying a condo.  Leave the damn country for over ½ the year, transfer the money when a non-resident and come back to buy it tax free.  Or pay up to 35% BS tax. Or better still -never buy a property in Thailand or any other big ticket item.  

Has AUD not appreciated 2.3% against the THB over the last month, 1% THB savings rate so less than 2% relative issue?

 

Seems a bad option to own property, assets, that cannot be managed under a 30 day tourist  exempt. Only family, Thai ID card holders should own things me thinks  Retirement Visa is only the label, not definitely the contents list, which is in perpetual detail Flux, or it seems that way since 2018 

 

Back to back external investment yeilding against rental cost still an option?

 

17 months out of 24 months seems still do-able as it's still remittance basis ( perhaps enjoy it whilst you can applies) live on your unremitted Thai tax assessable whilst non tax resident, and remit the derived  in year stuff whilst not in Thailand more than 179.

 

It is becoming increasingly awkward if still essentially one foot in each of two (or more) countries.

[Rampant Rabbit]

Anyone know the score on this scenario , My parents   gave me their  house over 24 years  ago to avoid the state taking it in their old  age (its now my only UK resdence), all done  by UK solicitor, they pay me rent of £1 a  year to live there.

At the time its value was £75000, its  current  value is £300000, My mother still lives there but she is  96 and at some point will die. I will then sell this  house, its value as of Jan 24 was £300000k would I need that in writing from the estate agent as a valuation dated Jan 1 -2024? and what may I be  liable for? There  will be no Capital Gains Tax on this  properyt in the UK   reading below its says "profit on the investment" but this  looks  more to me like I inherited the property? Live in Thailand permanently

 

 

The capital used to buy the investment is free of Thai tax but the amount may need to be proven via statements etc.

 

The profit on the investment that was earned prior to 1 January 2024 is tax free but the amount should be capable of being proven hence a statement or valuation dated 1 January 2024 will be helpful.

[TroubleandGrumpy]

11 hours ago, aussienam said:

Thanks mate.  I am in a unique situation transitioning funds into Super both Concessional contributions (which I pay additional 15% tax using a 'Notice of Intent to Claim a Deduction' on my tax return - seems separate to nett earnings tax?) and non-concessional contributions from external investments.  (To date - concessional contribution cap limits are $27,500 per financial year and non-concessional contributions are capped at $110,000 per financial year, with $330,000 allowed as an alternative as a 3-year bring forward contribution cap limit).  

You state that in the accumulation phase Super nett earnings gets taxed 15%.  Okay.  On both concessional and non-concessional contributions?

I am not talking about contributions to Super - that is not income which can be taxed in Thailand.  The earnings you make (annual growth) in your Super Fnd in 'contributions phase' is taxed at 15% by the Super Fund and paid direct to ATO on a fundwide basis.  When you (anyone) get to 60+ you can change the Fund to 'retirement phase' which means the earnings made by your money is not taxed at 15%. But the downside to that is that the money you receive in that hpase is counted by CLink as Income - Gotcha - so be careful doing that. Obviously that applies to those reciving Super and the Pension (like me). And once you are 75 the money in Super is automatically 'converted' to retirement phase (yet another rip-off change made). 

[Mike Lister]

4 minutes ago, TroubleandGrumpy said:

I am not talking about contributions to Super - that is not income which can be taxed in Thailand.  The earnings you make (annual growth) in your Super Fnd in 'contributions phase' is taxed at 15% by the Super Fund and paid direct to ATO on a fundwide basis.  When you (anyone) get to 60+ you can change the Fund to 'retirement phase' which means the earnings made by your money is not taxed at 15%. But the downside to that is that the money you receive in that hpase is counted by CLink as Income - Gotcha - so be careful doing that. Obviously that applies to those reciving Super and the Pension (like me). And once you are 75 the money in Super is automatically 'converted' to retirement phase (yet another rip-off change made). 

As requested previously, can we please move this discussion to the Australian pensions thread and leave this one clear for tax guide queries and new fact that is not dta dependent? Thanks.

[TroubleandGrumpy]

11 hours ago, aussienam said:

Maybe there is some sort of letter that is verified by the ATO that can be produced for international tax compliance purposes?  Sounds like it may be the case since there are other countries that already impose a non-resident tax too on foreigners incoming remittances and those expats require proof of tax? 

I have been trying to get that since October last year - there is no such thing.  At best I got a letter from my Super Fund stating that my earnings are taxed at 15% - but they cannot state exactly how much tax was paid because it is all lumped together.  ATO have given me nothing except the official words/statement about how Super Funds are taxed.  Imaghine if 20 million people decided they wanted to know that information - it would cost a fortune for everyone to put things in place - aint goinna happen - Super is about saving money for retirement.   Plus even if I/you could get something - which they will not do it for January to December - the tax year in Aust is July to June. That fact alone screws up a lot of any chance to comply with any TRD demand to prove tax paid under a DTA from Jan to Dec last year and do it before 31 March. 

 

As I said - IMO Expats should stay away from TRD for the first few years - plead ignorance if questioned. I am hopeful that at some point the Thai Govt will do what bopth the Philippines and Malaysian Govts have done and state that they have no intention of taxing retired Expats who are bringing money into the country - it is not as if they have taken money out and are then bringing it back in tax free - it is all 'new' money. If you (anyone) are earning heaps of income overseas and you (anyone) would owe heaps of income taxes in 3-5 years, I suggest you/they have a Plan B that includes an emergency departure - in case the Thai Govt does not state they will not tax retired Expats and you get a letter from TRD in 3-5 years.

[TroubleandGrumpy]

11 hours ago, aussienam said:

MY POST CONCERNS THOSE WHO ARE AUSTRALIAN EXPATS - WHO ARE SELF FUNDED RETIREES AND/OR HAVE OR INTEND TO HAVE A PRIVATE (NON-GVT) PENSION FUNDED THROUGH AN EXISTING PRIVATE SUPERANNUATION FUND.  

 

Thanks mate.  I am in a unique situation transitioning funds into Super both Concessional contributions (which I pay additional 15% tax using a 'Notice of Intent to Claim a Deduction' on my tax return - seems separate to nett earnings tax?) and non-concessional contributions from external investments.  (To date - concessional contribution cap limits are $27,500 per financial year and non-concessional contributions are capped at $110,000 per financial year, with $330,000 allowed as an alternative as a 3-year bring forward contribution cap limit).  

You state that in the accumulation phase Super nett earnings gets taxed 15%.  Okay.  On both concessional and non-concessional contributions?

 

Maybe there is some sort of letter that is verified by the ATO that can be produced for international tax compliance purposes?  Sounds like it may be the case since there are other countries that already impose a non-resident tax too on foreigners incoming remittances and those expats require proof of tax? 

 

Here is where to me it gets extremely complex and uncertain: 

 

1) I was planning to liquidate an investment early next financial year (Oz) and make a large non-concessional contribution into my Superannuation fund, just after 1 July this year, using the '3-year bring forward rule.  It allows you to make three years worth of non-concessional contributions at the yearly maximum contribution cap limit.  This is in lieu of the usual yearly non-concessional contribution cap limit.  

 

I was then planning to almost immediately (same financial year) convert that contribution into a newly created 2nd pension account.  I have spoken to the Superannuation fund and they said this is fine - no waiting period, and will be provided the option to merge that new pension account with my existing Super fund pension account (save on doubling up on monthly admin fees). 

 

2) The issue I am now unsure of therefore, is that that newly deposited non-concessional contributions (x3 year's worth) will not have had time to be in an accumulation phase (?) as it will almost immediately be transferred into a new pension account before the next financial year.

 

The Super fund may impose a 15% tax on any possible small earnings made before transfer, but may not be in the fund long enough to have accumulated any nett earnings (wouldn't have happened to my other funds i moved from my Superannuation account into a current small Super pension, as I had that money invested in the Superannuation fund account for a few years beforehand, so would have been taxed over 2-3 financial years first).  Maybe I need to hold off converting a new contribution into a pension account for a year until it has been taxed over a financial year? But not sure the point:

 

3) Issue as well is that the Super fund already has funds I have added, that would have been taxed assessed (and will be taxed assessed this financial year) and therefore had 15% taken out-of nett earnings. 

My non-concessional contributions after 1 July will be added to that same account and merged with the same funds already taxed. 

 

4) Finally, in the pension fund, it is still accumulating (albeit at a lower % as I am drawing a pension from it), albeit what I believe is all untaxed.  So I am concerned that money in a pension fund that is accumulating from untaxed profits (since it moved to the pension fund), could be taxable by Thai revenue. 

 

5) Seems to me from my basic understanding, that you may be able to somehow argue that the money in the pension fund had been in a Super fund where it was taxed yearly on net income earnings at 15%.  But any nett earnings made on that amount since it was transferred over to a pension account is untaxed (currently averaging out over 10 years at around 8% p/a). 

Also issue is the deposit amounts put into Super as concessional and non-concessional contributions - they are not nett earnings from Super, and probably deemed savings and/or income derived from other taxed investments. 

 

So those contribution amounts transferred to the pension account haven't been taxed within Super accumulation phase.  Only the nett earnings have.  And we cannot backtrack all contribution amounts into Super over years (decades for most) to see where they all derived from and whether they were untaxed or taxed before being contributed into Super.  

 

How to 'un-muddy' those waters?  

 

To summarize: Basically, in Oz, private pensions, when remitting money to LOS, we are moving money into Thailand from an untaxed pension fund, that previously was taxed only on nett earnings during accumulation phase in the Superannuation fund beforehand.  The contributions into the Super fund that generated those earnings may have been untaxed (savings/base amount before interest earned on any investment, inheritance, compensation, etc) or taxed (income derived from external investments, taxed salaries, etc) prior to them being contributed into to the Super fund. 

 

I don't know if Thai Revenue cares about the sources of the Super fund contributions and if taxed over the decades before being put into a Super fund accumulation phase, only if the pensions accounts are or are not being taxed.  Seems they just may look at the pension itself and if it is/isn't taxed and not the history of the accumulation of funds beforehand? 

 

Something I obviously need clarification with from my accountant and the Super fund.  They may be able to clarify some tax info on the Australian end at best, but you'd need international tax expert advice who thoroughly understand Thai tax laws, as well as a lot of clarification from Thai revenue department. 

 

I have watched a public expat forum in Pattaya on YouTube where a tax expert guest attended and mentioned he did not believe Australian pensions would be taxed - according to his and his firm's interpretation of the legislation and DTAs.  But we get alternative interpretations since.  

 

I am still not feeling any more confident about this.  Keeping frugle and minimizing transfers still. And definitely holding off making any investments into Thailand. 

 

Thanks. 

That is too much to break down mate - beyond the replies I already gave - sorry mate.  If you were to buy me lunch/drink one day we could talk for a few hours - I did what youy are thinking about doing - but I have a lot of questions - like are you in Thailand now -= are you married - what sort of Visa bla bla bla. Those and many more will make a difference about what to do.  The problem you have is that there are not many 'financial advisers' that will look at your situation and give a genuine independent advice on what to do. Because they have 'preferred investments' and they dont know Pension issues and they dont know Thai tax rules and they dont know a lot about Expat issues and a lot more. I took almost a year planning and research to do what I did - and even then I made a few mistakes - but I got the 'big stuff' right. 

 

I have seen several advices claiming that the Aust Pension is both taxable and non-taxable in Thailand.  My read of the DTA is that it could be intereted either way - but the clauses and sections I have read lead me to decide it is not taxable for me. That is based on many things - including that I am still a tax resident in Australia and Australia is still my main 'place' (finances, family, friends, super, pay taxes, citizen, legal status, etc etc etc). The DTAs were written for companies - not individuals - and a company in Thailand can pay taxes in Aust on money earned in Aust (just like I do).   

 

This is the facts and only facts - everything else is specuilation and opinion.  If you make/earn money in Thailand, you pay taxes in Thailand.  If you take Thai money overseas and invest it, you can no longer bring back that money and earnings made from that money tax free if 'seasoned' for over 12 months.   

[TroubleandGrumpy]

18 minutes ago, Mike Lister said:

As requested previously, can we please move this discussion to the Australian pensions thread and leave this one clear for tax guide queries and new fact that is not dta dependent? Thanks.

Mike you are no longer a Mod - but could you take this up with the Mods.

There is no thread on the Australian forum that covers this new income taxes on remitted money for Aussies. 

The OAP thread is only about the Pension - not about this new tax regime.

If you/they (Mods) could start a new thread and make it linked/sticky on the front page - and then move into that thread our posts made here that would be great.

 

Edited April 1 by TroubleandGrumpy

[TroubleandGrumpy]

2 hours ago, Rampant Rabbit said:

Anyone know the score on this scenario , My parents   gave me their  house over 24 years  ago to avoid the state taking it in their old  age (its now my only UK resdence), all done  by UK solicitor, they pay me rent of £1 a  year to live there.

At the time its value was £75000, its  current  value is £300000, My mother still lives there but she is  96 and at some point will die. I will then sell this  house, its value as of Jan 24 was £300000k would I need that in writing from the estate agent as a valuation dated Jan 1 -2024? and what may I be  liable for? There  will be no Capital Gains Tax on this  properyt in the UK   reading below its says "profit on the investment" but this  looks  more to me like I inherited the property? Live in Thailand permanently

 

Thailand does not tax inheritences valued under 100 Million Baht (about 2.2 million pounds) 😁 

[TroubleandGrumpy]

9 hours ago, Mike Lister said:

There are several threads in the Australian home country forum that are specific to Australians, linked below is one such thread. Please do not post Australian specific issues here since they will not be well responded to and the thread is reserved for known fact rather than debate. Thanks. Note: non-relevant posts will be deleted periodically, in order to keep the thread readable for new commers.

 

As discussed Mike - this is for the OAP - it is not about Income Taxes on Remittances in Thailand.

 

[Mike Lister]

If that's what you want, that's what you shall have.

[TroubleandGrumpy]

Just now, Mike Lister said:

If that's what you want, that's what you shall have.

Cheers Mike - much appreciated 😁 

[Mike Lister]

1 minute ago, TroubleandGrumpy said:

Cheers Mike - much appreciated 😁 

No, you misunderstand. If you are not prepared to cooperate and leave this thread clean and instead, post half page posts and rants about Australia, the threads is all yours to do with as you please.

[TroubleandGrumpy]

10 minutes ago, Mike Lister said:

No, you misunderstand. If you are not prepared to cooperate and leave this thread clean and instead, post half page posts and rants about Australia, the threads is all yours to do with as you please.

Ok then - in the abscence of another option, we Aussies will continue to discuss the Thailand Expat income tax issues right here.

Half page posts and rants about Australia - all good.

[topt]

3 hours ago, Rampant Rabbit said:

There  will be no Capital Gains Tax on this  properyt in the UK   reading below its says "profit on the investment" but this  looks  more to me like I inherited the property? Live in Thailand permanently

Just a query but are you officially non resident for tax in the UK with HMRC? If so would you not be liable for tax on the sale based on the rule change 2015?

https://www.gov.uk/government/publications/non-resident-capital-gains-for-land-and-property-in-the-uk-self-assessment-helpsheet-hs307/hs307-non-resident-capital-gains-on-direct-and-indirect-disposals-of-interest-in-uk-land-and-property-2023

 

and from here - https://www.aesinternational.com/blog/expat-guide-to-property-tax-in-the-uk

Quote

New CGT rules for British expats and UK non-resident property owners

Before the 6^th April 2015, you were not taxed in the UK on gains made when you sold UK property if you were non-UK resident for five consecutive UK tax years.

Since that date, if you’re a British expat who owns property in the UK, you have to pay CGT if you sell your property for a gain.

 

[UKresonant]

Just now, Rampant Rabbit said:

Anyone know the score on this scenario , My parents   gave me their  house over 24 years  ago to avoid the state taking it in their old  age (its now my only UK resdence), all done  by UK solicitor, they pay me rent of £1 a  year to live there.

At the time its value was £75000, its  current  value is £300000, My mother still lives there but she is  96 and at some point will die. I will then sell this  house, its value as of Jan 24 was £300000k would I need that in writing from the estate agent as a valuation dated Jan 1 -2024? and what may I be  liable for? There  will be no Capital Gains Tax on this  properyt in the UK   reading below its says "profit on the investment" but this  looks  more to me like I inherited the property? Live in Thailand permanently

 

 

The capital used to buy the investment is free of Thai tax but the amount may need to be proven via statements etc.

 

The profit on the investment that was earned prior to 1 January 2024 is tax free but the amount should be capable of being proven hence a statement or valuation dated 1 January 2024 will be helpful.

 

A couple of other links

https://www.gov.uk/tax-sell-home

https://www.gov.uk/tax-live-abroad-sell-uk-home

 

Would you not have to stay there for at least 92 Days per year to maintain your UK Tax residency, via sufficient Ties Test

If your on the property more than 1 day per year/more than 16 days per year.

&

91 days per year over at two year period, unless you have 90 days plus in the last couple of years already.

 

Not sure if Thai RD would recognise it as inheritance it depends on the transaction your Solicitor made.

 

https://www.gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis/rdrm11000

https://www.gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis/rdrm11500

https://www.gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis/rdrm11710

 

I think safety would be not being in Thailand more than 179 days in the calendar year and also being UK Tax Resident, when you sell your house

Edited April 1 by UKresonant

[Rimmer]

This topic is now closed and is replaced with the updated version which can be found HERE

 

//CLOSED//