Introduction to Personal Income Tax in Thailand

[Presnock]

fyi

[Presnock]

On 12/25/2024 at 10:36 AM, Ricohoc said:

 

End-of-year statement 2023 secured and waiting.

 

 

[Presnock]

FYI:  on 16 dec, a briefing of ASEAN about the world wide income taxation was given which indicates that the Thai govt is "set to overhaul its tax sysem by 2025 proposing the taxation of residents' worlwide income and introducing a 15 percent global minimum corporate tax".

https://www.aseanbriefing.com/news/thailands-global-income-tax-overhaul-implications-for-rsidents-and-investors/

[Presnock]

Just now, Presnock said:

FYI:  on 16 dec, a briefing of ASEAN about the world wide income taxation was given which indicates that the Thai govt is "set to overhaul its tax sysem by 2025 proposing the taxation of residents' worlwide income and introducing a 15 percent global minimum corporate tax".

https://www.aseanbriefing.com/news/thailands-global-income-tax-overhaul-implications-for-rsidents-and-investors/

I wonder why we see about the 15% corporate tax and 2025 start but nothiing about the worldwide income taxation as part of the same bill

[chiang mai]

13 minutes ago, Presnock said:

FYI:  on 16 dec, a briefing of ASEAN about the world wide income taxation was given which indicates that the Thai govt is "set to overhaul its tax sysem by 2025 proposing the taxation of residents' worlwide income and introducing a 15 percent global minimum corporate tax".

https://www.aseanbriefing.com/news/thailands-global-income-tax-overhaul-implications-for-rsidents-and-investors/

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[treetops]

6 minutes ago, chiang mai said:

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There's a typo in the word residents in the original post.  Try this or go to "Tax and Accounting" and it's currently the second article.

 

https://www.aseanbriefing.com/news/thailands-global-income-tax-overhaul-implications-for-residents-and-investors/

[chiang mai]

I suppose if they fast track the proposals and all the planets align, it's conceivable that the new system could be implemented in 2025, if that happens it will be a game changer for many. We heard last year that some DTA's were being renegotiated but we've heard nothing more, perhaps that will be part and parcel of the new order.....it's somewhat troubling..

[Presnock]

53 minutes ago, chiang mai said:

Page not found

maybe because I dropped the first e in residents..try that

45 minutes ago, treetops said:

 

There's a typo in the word residents in the original post.  Try this or go to "Tax and Accounting" and it's currently the second article.

 

https://www.aseanbriefing.com/news/thailands-global-income-tax-overhaul-implications-for-residents-and-investors/

thanks, fingers at 78 just don't pay attention to spelling..

[Presnock]

Just now, Presnock said:

maybe because I dropped the first e in residents..try that

thanks, fingers at 78 just don't pay attention to spelling..

Also, I read earlier this past week that they hoped to get the 15% corporate tax out by  January so that they could implement it in 2025 but earlier there wasn't any mention about the worldwide income tax as part of  the same bill.  I thought they meant that they needed to have the parliament pass the bill by 1 January - then the print in the Gaxette prior to starting but now i am not sure what they plan to do... standing by, checking different areas to see if someone is talking about it.  Good luck to all.

 

[Jingthing]

I would like to get my understanding of "First In, First Out" confirmed in the context of a U.S. account where accessible and non-accessible to Thai tax is MIXED. The account is used to transfer funds into Thailand.

 

I will do this by example.

 

Deposit of 10K non accessible into the U.S. mixed account.

 

Deposit of 15K accessible into the U.S. mixed account.

 

Deposit of 20K non accessible into the U.S. mixed account.

 

Transfer of 12K into Thailand.

 

Only 2K of that 12K accessible as the "first in" 10K was non accessible. 

 

Transfer of 15K into Thailand.

 

The remaining 13K of the 15K accessible plus 2K non accessible.

 

Does this example reflect a correct understanding of "First In First Out" or not?

If not, what am I getting wrong?

[chiang mai]

4 minutes ago, Jingthing said:

I would like to get my understanding of "First In, First Out" confirmed in the context of a U.S. account where accessible and non-accessible to Thai tax is MIXED. The account is used to transfer funds into Thailand.

 

I will do this by example.

 

Deposit of 10K non accessible into the U.S. mixed account.

 

Deposit of 15K accessible into the U.S. mixed account.

 

Deposit of 20K non accessible into the U.S. mixed account.

 

Transfer of 12K into Thailand.

 

Only 2K of that 12K accessible as the "first in" 10K was non accessible. 

 

Transfer of 15K into Thailand.

 

The remaining 13K of the 15K accessible plus 2K non accessible.

 

Does this example reflect a correct understanding of "First In First Out" or not?

If not, what am I getting wrong?

Non assessable income is not a part of FIFO, only assessable income is, even though the account contains commingled funds. It would be down to you to state whether your remittance was assessable income or not.

 

BTW and I suspect you already know this but the term is assessable (as in to be assessed), not accessible.

[Jingthing]

10 minutes ago, chiang mai said:

Non assessable income is not a part of FIFO, only assessable income is, even though the account contains commingled funds. It would be down to you to state whether your remittance was assessable income or not.

 

BTW and I suspect you already know this but the term is assessable (as in to be assessed), not accessible.

Thanks but I don't understand your answer!

The U.S. account would be MIXED.

So for my purposes of figuring out which parts of that account are accessed by TR if transferred I would need (for my own purposes) to know in detail about every dollar in that account and would also need to track the flows in detail, always knowing which parts would be accessed by TR if transferred.

You seem to be talking about it from the TR end only.
I'm not talking about telling TR all this detail or mentioning EXEMPT transfers at all. 

But if audited I would need to show the source MIXED account and show the time history of the funds and as the source U.S. account is mixed the different parts would need to be identified.

So in that context is my comprehension still wrong?!?

If so, I'm at a total loss as to how to handle such a MIXED account.

 

[Jingthing]

Let me ask this another way.

Say my source MIXED account has 20K (not accessed by TR if transferred).

Later I deposit 5K into that MIXED account that would be accessed by TR is transferred.

So then I remit 5K to Thailand.

First in my MIXED account was 20K, but are you saying that if I remit that 5K put in AFTER the 20K that the 5K would be accessed?!? 

[JB300]

2 minutes ago, Jingthing said:

The U.S. account would be MIXED.

So for my purposes of figuring out which parts of that account are accessed by TR if transferred I would need (fior my own purposes) to know in detail about every dollar in that account. 

 

Exactly this & is it really hard to keep a track of where the money comes from ?

 

I have income from property, dividends/CGT from stocks & shares etc… and it takes a minute to stick in a spreadsheet when/where the cash came from. 
 

Then simply spend (or send to Thailand) from the oldest forward. 

[chiang mai]

1 minute ago, Jingthing said:

Thanks but I don't understand your answer!

The U.S. account would be MIXED.

So for my purposes of figuring out which parts of that account are accessed by TR if transferred I would need (fior my own purposes) to know in detail about every dollar in that account. 

You seem to be talking about it from the Thai end which I do get.
I'm not talking about telling TR all this detail.

But if audited I would need to show the source MIXED account and show the time history of the funds.

So in that context is my comprehension still wrong?!?

If so, I'm at a total loss as to how to handle such a MIXED account.

 

Non-assessable income doesn't form part of FIFO accounting from the Thai side at least but yes, you will need to understand in detail all the transactions into and out of the account, assessable and not assessable. If you have three deposits into a commingled account and one is not assessable, there would be no need to prioritise that entry when deciding FIFO for your Thai remittance, you could instead ignore it for FIFO purposes. But of course, you will need to be aware of the "not assessable" deposit because as you say, in the event of an audit you would need to explain why the deposit wasn't prioritised during FIFO and instead it was ignored.

[JB300]

1 minute ago, Jingthing said:

Let me ask this another way.

Say my source MIXED account has 20K (not accessed by TR if transferred.

I deposit 5K into that MIXED account that would be accessed by TF is transferred.

So then I remit 5K to Thailand.

First in my MIXED account was 20K, but are you saying that if I remit that 5K put in AFTER the 20K that the 5K would be accessed?!? 

If the oldest $5K part of that $20k was Tax assessable then yes the $5K you send would be tax assessable. 
 

The last $5k you deposited would (appropriately) be termed Last In. 
 

 

[Jingthing]

2 minutes ago, JB300 said:

Exactly this & is it really hard to keep a track of where the money comes from ?

 

I have income from property, dividends/CGT from stocks & shares etc… and it takes a minute to stick in a spreadsheet when/where the cash came from. 
 

Then simply spend (or send to Thailand) from the oldest forward. 

I'm not saying it's rocket science but it's not something I've done before with no bookkeeping experience.

I would  also be SPENDING from the same account which would constantly move the numbers as well.

[JB300]

Just now, Jingthing said:

I'm not saying it's rocket science but it's not something I've done before with no bookkeeping experience.

I would  also be SPENDING from the same account which would constantly move the numbers as well.

Trust me I know it’s hard as I have only one bank account in the UK that everything happens from but I have found a good spreadsheet (Libre Office if you don’t have Excel) makes life so much easier 👍🏻

 

 

[Jingthing]

Just now, JB300 said:

If the oldest $5K part of that $20k was Tax assessable then yes the $5K you send would be tax assessable. 
 

The last $5k you deposited would (appropriately) be termed Last In. 
 

 

Confusing answer. 

I said EXPLICITLY that the original 20K was no accessible by TR if remitted.

The newer 5k would be. 

Another thing. I expect that there would be mixed remittances.

With proper records I would know which part of interest to TR and which not.

[chiang mai]

2 minutes ago, Jingthing said:

Let me ask this another way.

Say my source MIXED account has 20K (not accessed by TR if transferred).

Later I deposit 5K into that MIXED account that would be accessed by TR is transferred.

So then I remit 5K to Thailand.

First in my MIXED account was 20K, but are you saying that if I remit that 5K put in AFTER the 20K that the 5K would be accessed?!? 

May we please get the terminology correct, it is assessable not accessible, it makes for confusing reading otherwise.

 

The short answer to your question is yes, the longer answer is that it's down to you and only you to state what the funds are, assessable or not assessable and you would be required to prove what you say, if audited. You are under no obligation to remit assessable vs not assessable but you are obliged under FIFO rules to remit the first assessable deposit, before the second assessable deposit, regardless that there may have been not assessable deposits in-between.

[Jingthing]

Just now, JB300 said:

Trust me I know it’s hard as I have only one bank account in the UK that everything happens from but I have found a good spreadsheet (Libre Office if you don’t have Excel) makes life so much easier 👍🏻

 

 

Thanks.

I was going to get into this later. Suggesting for bookkeeping tools.

[chiang mai]

4 minutes ago, JB300 said:

If the oldest $5K part of that $20k was Tax assessable then yes the $5K you send would be tax assessable. 
 

The last $5k you deposited would (appropriately) be termed Last In. 
 

 

Your answer is incorrect, using JT's example the 20k was not assessable and already in the account, before assessable income was added.

[JB300]

Just now, Jingthing said:

Confusing answer. 

I said EXPLICITLY that the original 20K was no accessible by TR if remitted.

The newer 5k would be. 

Another thing. I expect that there would be mixed remittances.

With proper records I would know which part of interest to TR and which not.

How was my answer confusing?

 

If you’re sending money from the original $20k that is not assessable then the money is not assessable until the $5K that is assessable becomes the oldest funds being remitted. 
 

[Jingthing]

13 minutes ago, chiang mai said:

May we please get the terminology correct, it is assessable not accessible, it makes for confusing reading otherwise.

 

The short answer to your question is yes, the longer answer is that it's down to you and only you to state what the funds are, assessable or not assessable and you would be required to prove what you say, if audited. You are under no obligation to remit assessable vs not assessable but you are obliged under FIFO rules to remit the first assessable deposit, before the second assessable deposit, regardless that there may have been not assessable deposits in-between.

Thanks.

I think that I probably understand you now, by which I mean according to my understanding I was basically correct at first.

Perhaps using the word EXEMPT would have been better for the chunks out of TR's interest.

[chiang mai]

2 minutes ago, Jingthing said:

Thanks.

I was going to get into this later. Suggesting for bookkeeping tools.

WPS Office is also free and it's command structure is much closer to Microsoft. Libre is good but is open source and not 100% road ready plus it updates frequently.

[Jingthing]

1 minute ago, JB300 said:

How was my answer confusing?

 

If you’re sending money from the original $20k that is not assessable then the money is not assessable until the $5K that is assessable becomes the oldest funds being remitted. 
 

Sorry for any confusion. You seemed to be adding a confusing element by suggesting part of the original 20K (EXEMPT) would actually not be. 

[JB300]

5 minutes ago, Jingthing said:

Thanks.

I was going to get into this later. Suggesting for bookkeeping tools.

Google sheets is probably the easiest if you don’t need complex formulas, Libre office does the same job as excel & is free but I use Excel as I have an MS subscription so it’s free for me. 
 

 

[Jingthing]

I'll look into those tools but this task is a simple one by accounting standards and I'm wondering if there's a super easy tool for "idiots" that would work for someone that has never done spreadsheets or bookkeeping of any kind.

[chiang mai]

2 minutes ago, Jingthing said:

I'll look into those tools but this task is a simple one by accounting standards and I'm wondering if there's a super easy tool for "idiots" that would work for someone that has never done spreadsheets or bookkeeping of any kind.

Basic spreadsheets for the tracking purposes you require are very simple, they may seem daunting at first glance but adding numbers together and adding entries and dates etc is a real breeze. I suggest you download the program of choice and play around with it doing simple stuff, until you get the hang of it, which will be very quick. And shout if you get stuck, lots of people will help guide you.

[Jingthing]

Just now, chiang mai said:

Basic spreadsheets for the tracking purposes you require are very simple, they may seem daunting at first glance but adding numbers together and adding entries and dates etc is a real breeze. I suggest you download the program of choice and play around with it doing simple stuff, until you get the hang of it, which will be very quick. And shout if you get stuck, lots of people will help guide you.

Thanks.

Ideally I'm looking for a tool that would highlight the assessable portion in some distinctive visual way so in the context of my original example I could always see when the withdraws were heading from exempt into assessable territory.

I assume any tool could be used to print reports.