Introduction to Personal Income Tax in Thailand

[Unamerican]

On 3/16/2025 at 6:10 PM, Liquorice said:

Any tax paid in the UK under the DTA can be applied as a 'tax credit' against any tax due in Thailand, but as mentioned previously there is nowhere on the forms to enter such paid tax as a credit.

No, it is not that simple: proportions etc. need to be calculated!  Please read the DTA in detail for the necessary calculations. 

[Unamerican]

On 1/25/2025 at 6:14 AM, essexman said:

She added my pension payments together and then worked out my allowances. 

Do please can you tell,us the details of your allowances? Thank you! 

[gamb00ler]

On 3/16/2025 at 7:21 PM, anrcaccount said:

What about the thousands ( tens of thousands) of foreigners who remitted THB millions in 2024 to buy property....or even expensive vehicles? None of them are paying tax, right?

You didn't mention that tax would only be due on the "remitted THB millions in 2024" if it was earned in 2024.  It is very likely that by far the bulk of any funds remitted for purchase of property would have been earnings from prior years and as such would be non-assessable.

 

No need for hysterics.

[anrcaccount]

5 minutes ago, gamb00ler said:

You didn't mention that tax would only be due on the "remitted THB millions in 2024" if it was earned in 2024.  It is very likely that by far the bulk of any funds remitted for purchase of property would have been earnings from prior years and as such would be non-assessable.

 

No need for hysterics.

Not necessarily at all. No hysteria present. 

 

Many people sell a property or stocks in their home country, and then purchase real estate in Thailand.

 

Many of the sales and subsequent purchases, would have happened in 2024, therefore any capital gain on the sale, theoretically assessable upon remittance to Thailand. 

 

But I suspect few to none would be declaring this,  despite this situation likely occurring many thousands of times in 2024. 

[JimGant]

8 hours ago, anrcaccount said:

Many people sell a property or stocks in their home country, and then purchase real estate in Thailand.

 

Many of the sales and subsequent purchases, would have happened in 2024, therefore any capital gain on the sale, theoretically assessable upon remittance to Thailand. 

Right -- but the value of that property or stocks on 12/31/2023 would be non assessable, per Por 162. However, some (or maybe it's just one) tax advisory outfits are saying, "Por 162 is limited to pre 2024 savings in a bank account." And a shill on this forum keeps echoing that.

 

Quote

Order No. Por.162/2566, issued on November 20, 2023, provides further clarification. It states that the new interpretation should not apply to foreign-sourced income earned before January 1, 2024

 

I think you'd be well within your reasoning powers to interpret Por 162 as NOT being restricted to bank savings accounts.

[Jingthing]

1 hour ago, JimGant said:

Right -- but the value of that property or stocks on 12/31/2023 would be non assessable, per Por 162. However, some (or maybe it's just one) tax advisory outfits are saying, "Por 162 is limited to pre 2024 savings in a bank account." And a shill on this forum keeps echoing that.

 

 

I think you'd be well within your reasoning powers to interpret Por 162 as NOT being restricted to bank savings accounts.

"Shill" here.

Pray tell kind sir what Thai tax advisory firm has come out to support your creative view that it isn't only about banked savings?

Crickets?

[Etaoin Shrdlu]

5 hours ago, JimGant said:

Right -- but the value of that property or stocks on 12/31/2023 would be non assessable, per Por 162. However, some (or maybe it's just one) tax advisory outfits are saying, "Por 162 is limited to pre 2024 savings in a bank account." And a shill on this forum keeps echoing that.

 

 

I think you'd be well within your reasoning powers to interpret Por 162 as NOT being restricted to bank savings accounts.

 

It is not clear, at least in my opinion, whether the basis used for determining the amount of capital gains for Thai tax purposes is the original cost of the asset when purchased, as would be the case under US tax regulations, or the value of the asset on 31 December 2023. In other words, are unrealized capital gains at 31 December 2023 added to the actual cost of the asset in order to determine the basis for calculating capital gains?

 

I think it is a bit of a stretch to consider unrealized capital gains as income earned in years prior to 2024. My gut tells me that the capital gains are earned in the year the asset is sold and the basis is the cost of the asset when purchased.

 

It would certainly be nice if the TRD would clearly state that the basis for capital gains is the value of the asset at 31 December 2023, but I'm not going to hold my breath.

 

 

 

 

[gamb00ler]

1 hour ago, Etaoin Shrdlu said:

I think it is a bit of a stretch to consider unrealized capital gains as income earned in years prior to 2024. My gut tells me that the capital gains are earned in the year the asset is sold and the basis is the cost of the asset when purchased.

You're correct that the capital gains are not known until the asset is sold or exchanged for a different asset.  However, any government can develop regulations that determine what portion of any gain is taxable.

 

It is very reasonable in situations where the asset is not actually sold/exchanged that some life or financial event triggers a deemed disposition at Fair Market Value (FMV).  For instance when I moved to a different country my home was treated as being sold and immediately reacquired at the same price.  I was then taxed on the deemed capital gain.

 

TRD should treat their new regulations as such a financial event.  The most reasonable implementation of TRD's change in assessibility of remitted income would use the FMV as of Dec. 31, 2023.  By doing so TRD would eliminate most of the disparity in taxation between long term and short term holdings that would otherwise be created by their arbitrary choice of effective date.

[Etaoin Shrdlu]

1 hour ago, gamb00ler said:

You're correct that the capital gains are not known until the asset is sold or exchanged for a different asset.  However, any government can develop regulations that determine what portion of any gain is taxable.

 

It is very reasonable in situations where the asset is not actually sold/exchanged that some life or financial event triggers a deemed disposition at Fair Market Value (FMV).  For instance when I moved to a different country my home was treated as being sold and immediately reacquired at the same price.  I was then taxed on the deemed capital gain.

 

TRD should treat their new regulations as such a financial event.  The most reasonable implementation of TRD's change in assessibility of remitted income would use the FMV as of Dec. 31, 2023.  By doing so TRD would eliminate most of the disparity in taxation between long term and short term holdings that would otherwise be created by their arbitrary choice of effective date.

 

Good point. Let's hope that the TRD does indeed use this approach.

[anrcaccount]

8 hours ago, JimGant said:

Right -- but the value of that property or stocks on 12/31/2023 would be non assessable, per Por 162. However, some (or maybe it's just one) tax advisory outfits are saying, "Por 162 is limited to pre 2024 savings in a bank account." And a shill on this forum keeps echoing that.

 

 

I think you'd be well within your reasoning powers to interpret Por 162 as NOT being restricted to bank savings accounts.

 

I agree with your logic and reasoning, but it is still unclear how the TRD views this.

 

Consider someone who simply worked a salaried job for 20 years in their home country, and over this 20 years paid all their spare income into the mortgage on the property. They then sold this property (for a significant capital gain as it was owned for 20 years!)  and transferred the proceeds to Thailand as a tax resident. 

 

How can Thailand even consider taxing this income, earnt prior to 31-12-2023, just because it is parked in a mortgage offset account , but funds in normal bank accounts are exempt? Absolutely ludicrous. Same goes for income invested into stocks / funds instead of parked in a bank.

 

As I've pointed out before, if they actually tried to implement this, it could be worked around by simply rebuying any stable asset with the proceeds of the original asset sale > Selling that asset at cost > and remitting the proceeds to  Thailand > no capital gain, no tax. 

 

Anyway, in full agreement with your view. 

 

If the TRD are in any way serious about taxing remitted foreign gains, they will 100% need to provide detailed clarity on the point of what constitutes 'income earned pre 2024'.