Gift Allowance / Tax Questions

[thomasfielk]

Hello,

 

As far as I understand I can gift my thai girlfriend up to 10 000 000 THB Tax free, or up to 20 000 000 THB Tax free if we are married.

 

Does that apply only for funds that are already in Thailand or I can gift her 7 000 000 THB from abroad so she can buy a house in Thailand?

 

The money was already taxed abroad at around 18-20%, and I'm wondering if I can gift her exactly 7 Million baht and she won't need to pay tax here, or I would need to gift her more to cover for taxes?

 

[Mike Lister]

20 minutes ago, thomasfielk said:

Hello,

 

As far as I understand I can gift my thai girlfriend up to 10 000 000 THB Tax free, or up to 20 000 000 THB Tax free if we are married.

 

Does that apply only for funds that are already in Thailand or I can gift her 7 000 000 THB from abroad so she can buy a house in Thailand?

 

The money was already taxed abroad at around 18-20%, and I'm wondering if I can gift her exactly 7 Million baht and she won't need to pay tax here, or I would need to gift her more to cover for taxes?

 

Please read the Simple Tax Guide linked below, the answer is in there.

 

 

[Mike Lister]

Pay attention to assendents and descendents, your girlfriend is neither.

 

Also, why Gift money that has already had tax paid on it, there is no need.

 

 

[proton]

so what's the answer?

[Mike Lister]

27 minutes ago, proton said:

so what's the answer?

Read the tax guide.

[proton]

8 minutes ago, Mike Lister said:

Read the tax guide.

too confusing

[Sandboxer]

While not married yet, send your Thai gf/bf money in reasonable increments that won't trigger legal problems on her end (i.e. I'd say $100k/THB 3.5-ish mil per year should not rouse any heads). 

 

Just make sure she really loves ya 555 😀

[freeworld]

1 hour ago, proton said:

too confusing

Then would suggest a consultation with a tax accountant.

[proton]

1 hour ago, freeworld said:

Then would suggest a consultation with a tax accountant.

 

No chance

[Mike Lister]

1 minute ago, proton said:

 

No chance

Hmmm, interesting, let's recap shall we?

 

Read the tax guide - can't, too difficult

See a tax consultant - no chance

 

That leaves:

Hide behind a bush - awaiting response

Go back home - awaiting response

Feign death - probably no point waiting for a response on this one.

 

Have I missed anything?

 

 

[thomasfielk]

3 hours ago, Mike Lister said:

Please read the Simple Tax Guide linked below, the answer is in there.

 

 

Hello Mike,

First of all, I would like to thank you for putting this guide together, I actually read it earlier today. However I do have a question regarding the following information:

"

Pay attention to assendents and descendents, your girlfriend is neither.

 

Also, why Gift money that has already had tax paid on it, there is no need."

That's correct, however I believe it would be tax free under this rule:
43) c) Maintenance income derived under a moral obligation or gifts made in a ceremony or on occasions in accordance with established custom from persons who are not ascendants, descendants, or spouse, in the amount not exceeding THB 10 million throughout a tax year.

 

We are not married, so I should be able to gift up to 10 Million Baht Per year.

 

The money is already taxed abroad since it was dividends from a company that I co-own with other shareholders + salary I have saved up. And instead of sending it from my bank account abroad to my thai bank account(and having to pay taxes since it would then be remitted income/savings), and then gifting it to her through a local bank transfer, I was wondering if I can gift it to her directly from my foreign bank account to her local bank account here. 

 

Would that work and is it above board is the question? I got a consultation with a lawyer last week who told me ''Don't worry about it, sounds good to me'' but I wanted to get a second opinion.

 

 

"Note: Only funds that are exempt from Thai tax or funds on which Thai tax has already been paid, can be Gifted. It is not possible to Gift funds that are assessable income, in order to avoid Thai tax."

 

Foreign earnings/dividends which are kept abroad and not remitted to Thailand are exempt from Thai tax so it should be fine?

Edited March 30 by thomasfielk

[Mike Lister]

20 minutes ago, thomasfielk said:

Hello Mike,

First of all, I would like to thank you for putting this guide together, I actually read it earlier today. However I do have a question regarding the following information:

"

Pay attention to assendents and descendents, your girlfriend is neither.

 

Also, why Gift money that has already had tax paid on it, there is no need."

That's correct, however I believe it would be tax free under this rule:
43) c) Maintenance income derived under a moral obligation or gifts made in a ceremony or on occasions in accordance with established custom from persons who are not ascendants, descendants, or spouse, in the amount not exceeding THB 10 million throughout a tax year.

 

We are not married, so I should be able to gift up to 10 Million Baht Per year.

 

The money is already taxed abroad since it was dividends from a company that I co-own with other shareholders + salary I have saved up. And instead of sending it from my bank account abroad to my thai bank account(and having to pay taxes since it would then be remitted income/savings), and then gifting it to her through a local bank transfer, I was wondering if I can gift it to her directly from my foreign bank account to her local bank account here. 

 

Would that work and is it above board is the question? I got a consultation with a lawyer last week who told me ''Don't worry about it, sounds good to me'' but I wanted to get a second opinion.

 

 

"Note: Only funds that are exempt from Thai tax or funds on which Thai tax has already been paid, can be Gifted. It is not possible to Gift funds that are assessable income, in order to avoid Thai tax."

 

Foreign earnings/dividends which are kept abroad and not remitted to Thailand are exempt from Thai tax so it should be fine?

Easy one first.....your last question......correct.

 

Also easy....you wrote, "The money is already taxed abroad since it was dividends from a company that I co-own with other shareholders + salary I have saved up'.

 

If those earnings are pre-31 December 2023, that money is free of Thai tax, only income earned after that date is assessable to Thai tax.

 

More tricky.....I don't know enough about the practical application of Gift Tax here so I can't comment on whether your proposed approach is viable or not. Does it meet the definition of, "Maintenance income derived under a moral obligation or gifts made in a ceremony or on occasions in accordance with established custom"? I don't know, sorry! But if your lawyer says fine, that may be the right answer. However, I think if I was in your situation, I may want to spend a few hundred Baht on a consultation with a Thai Tax CPA to get their view since they will understand this aspect more clearly.

 

 

 

[Etaoin Shrdlu]

There are really several questions here. 

 

In the event that the money would be taxable if remitted into Thailand but is intended to be a gift, then the gift may need to be completed prior to being remitted into Thailand. In other words, you would have to transfer the funds to your girlfriend's overseas account and then let her transfer from her overseas account to her Thai account.

 

I don't think it is clear yet that funds transferred from your account abroad directly to her account in Thailand would be considered a gift until they were deposited in her account. In other words, when the funds crossed the threshold into Thailand, and not yet in her account, they were still your funds and could therefore potentially be assessable income for you and not yet a gift to her. I'm not sure whether this issue has been clarified yet. If it has, perhaps someone else can advise. 

 

If the remittance from your overseas account to her Thai account would be considered your remittance and not her gift, then all the issues involving timing, source, DTA, amounts of tax paid and more come into play.

 

Just my opinion on this. You need to consult a tax expert.

[thomasfielk]

Is there a particular tax expert/CPA that anyone can recommend in Bangkok for a paid consultation?

[Mike Lister]

7 hours ago, thomasfielk said:

Is there a particular tax expert/CPA that anyone can recommend in Bangkok for a paid consultation?

Nobody has mentioned one in the past, perhaps if anyone does know of one they can PM you rather than post the details publically. 

[thomasfielk]

8 hours ago, Mike Lister said:

Nobody has mentioned one in the past, perhaps if anyone does know of one they can PM you rather than post the details publically. 

I'll see if I manage to find one on Google and report back. 

 

Hopefully it will be tax free in Thailand, so the house she wants to purchase doesn't end up costing 30% extra because of tax, in that case I guess we will keep renting lol

[Ray60]

On 3/30/2024 at 11:54 PM, Etaoin Shrdlu said:

There are really several questions here. 

 

In the event that the money would be taxable if remitted into Thailand but is intended to be a gift, then the gift may need to be completed prior to being remitted into Thailand. In other words, you would have to transfer the funds to your girlfriend's overseas account and then let her transfer from her overseas account to her Thai account.

 

I don't think it is clear yet that funds transferred from your account abroad directly to her account in Thailand would be considered a gift until they were deposited in her account. In other words, when the funds crossed the threshold into Thailand, and not yet in her account, they were still your funds and could therefore potentially be assessable income for you and not yet a gift to her. I'm not sure whether this issue has been clarified yet. If it has, perhaps someone else can advise. 

 

If the remittance from your overseas account to her Thai account would be considered your remittance and not her gift, then all the issues involving timing, source, DTA, amounts of tax paid and more come into play.

 

Just my opinion on this. You need to consult a tax expert.

of course its considered a gift if you remit fm your overseas account to your girlfriends account in TH, I have done it several times and no questions asked. Sending it fm your oversea account to her overseas account is nonsense, first of all not all TH girlfriends have overseas accounts and then you have to clarify how such transfers are handled by tax authorities overseas.

[Etaoin Shrdlu]

8 minutes ago, Ray60 said:

of course its considered a gift if you remit fm your overseas account to your girlfriends account in TH, I have done it several times and no questions asked. Sending it fm your oversea account to her overseas account is nonsense, first of all not all TH girlfriends have overseas accounts and then you have to clarify how such transfers are handled by tax authorities overseas.

 

Have you been audited by the TRD and was it their formal opinion that remittances from your overseas account to your girlfriend's Thai account are not considered potentially taxable remittances with respect to your tax situation?

[Lorry]

4 hours ago, Ray60 said:

I have done it several times and no questions asked.

Do you mean no questions asked by the Thai Revenue Department, who knew about these transactions because you told them, and who accepted them as gifts that reduced your tax burden?

[Ray60]

On 9/5/2024 at 10:16 PM, Etaoin Shrdlu said:

 

Have you been audited by the TRD and was it their formal opinion that remittances from your overseas account to your girlfriend's Thai account are not considered potentially taxable remittances with respect to your tax situation?

I am not a tax resident in Thailand, so why should they audit me? 

[Ray60]

On 9/6/2024 at 2:11 AM, Lorry said:

Do you mean no questions asked by the Thai Revenue Department, who knew about these transactions because you told them, and who accepted them as gifts that reduced your tax burden?

if then they should ask the Thai Girlfriend, since when does the sender have to pay tax for a gift? Anyway no questions asked by the banks or TRD.

[sometimewoodworker]

On 3/31/2024 at 12:50 AM, thomasfielk said:

Is there a particular tax expert/CPA that anyone can recommend in Bangkok for a paid consultation?

One of the big 4 international accountancy firms will give you an appointment for tax advice, the charge a flat 17,000 +vat and incidentals for a 1 hour appointment their office is in Empire Tower building 2. I received a referral from my management company.

 

Edited Thursday at 05:04 AM by sometimewoodworker

[sometimewoodworker]

On 9/5/2024 at 10:03 PM, Ray60 said:

of course its considered a gift if you remit fm your overseas account to your girlfriends account in TH, I have done it several times and no questions asked. Sending it fm your oversea account to her overseas account is nonsense, first of all not all TH girlfriends have overseas accounts and then you have to clarify how such transfers are handled by tax authorities overseas.

It needs a gift contract. Without that it is almost certainly not classed as a gift by TRD if she gets audited.
 

The penalties for perceived tax evasion range from a mild slap on the wrist to time in the Bangkok Hilton or other similar accommodation with 40~50 others in the same room.

Edited Thursday at 05:09 AM by sometimewoodworker

[chiang mai]

I would advise not to pay for tax advice, until more is known and the TRD releases the new forms and instructions, November or December seems about right to me.

[sometimewoodworker]

42 minutes ago, chiang mai said:

I would advise not to pay for tax advice, until more is known and the TRD releases the new forms and instructions, November or December seems about right to me.

Nothing is going to change between now and then apart from the tax advisors are going to fill up their available appointments. They were already getting quite busy a few months ago.
 

You may believe that there is going to be new information, you may be correct. I doubt that there will be anything relevant until or unless the talked about WW taxation laws are passed and that is not happening this year and probably not for quite a time if it ever does.

 

Any slight changes are extremely unlikely until the TRD has been able to digest the results of the 2024 returns so probably not before June 

Edited Thursday at 05:31 AM by sometimewoodworker

[chiang mai]

8 minutes ago, sometimewoodworker said:

Nothing is going to change between now and then apart from the tax advisors are going to fill up their available appointments. They were already getting quite busy a few months ago.
 

You may believe that there is going to be new information, you may be correct. I doubt that there will be anything relevant until or unless the talked about WW taxation laws are passed and that is not happening this year and probably not for quite a time if it ever does.

 

Any slight changes are extremely unlikely until the TRD has been able to digest the results of the 2024 returns so probably not before June 

We don't agree, I expect greater clarification of several issues, which the new forms should make clear.

[KhunHeineken]

14 hours ago, chiang mai said:

I would advise not to pay for tax advice, until more is known and the TRD releases the new forms and instructions, November or December seems about right to me.

I agree.

 

Too early to seek professional advice at this stage.  

 

More will be revealed as to how all of this will play out in the near future. 

 

However, many should already be considering best and worse case scenarios at the present time.