Legal Strategies to Reduce Thai Tax

[RocketDog]

On 5/18/2024 at 9:23 PM, Ben Zioner said:

Would need to be THB, changers in Thailand will record ID.

And if you buy THB at your home country bank you will pay huge FOREX rates.

Also, traveling with a bid wad of cash seems like a bad idea to me.

[sometimewoodworker]

3 hours ago, Robin said:

I have read through all the 19 pages above, and it seems to me that much depends on the definition of 'savings' that are being brought in to Thailand.

You need to read the Thai tax law

3 hours ago, Robin said:

If I sell my house in UK, is this money 'savings'  House was bought over the years with payments from my income.  Was that "savings,"

No, You need to read the Thai tax law

 

3 hours ago, Robin said:

Value of house has increased during the time I have owned it, but as my 'principal dwelling ' in UK it is exempt from UK Capital gains tax.

The HMRC view is irrelevant 

3 hours ago, Robin said:

How will RD view this money if I transfer it to my Thai bank account?  I would call it savings.

The TRD has a different view, You need to read the Thai tax law

 

3 hours ago, Robin said:

Second question;  If I give this money to a trusteed friend in UK, and they then send me 20M B as a gift, is this exempt from tax?  If they do that every year until the money is used up, is it still a tax emept gift?

The TRD is well aware of tax evasion strategies. It is your money you are liable for assessing it for, and paying, the tax if you don’t you will be breaking the law.

 

 

NB I am not now or ever giving tax evasion advice. I can and do, sometimes, respond to hypothetical situations. 

[sometimewoodworker]

2 hours ago, Kalasin Jo said:

Very sad to report my wife's  unexpected death on 10th July and cremation on 14th July at our local temple after a prolonged illness with progressive neurological deficit and in consequence increasing physical deficit too.

 

I'm not posting here for sympathy but to ask what effect this has on the substantial allowance against income for a non working wife. Obviously without a wife here it will cease to be available, but when? Can I claim it for the whole of 2024, is it apportioned, or simply not available?

Thanks in anticipation.

You have my sympathy unfortunately you need advice from either a professional or you can try the localTRD office. The TRD staff are often helpful. I very much doubt if you will get a solid answer from this forum.

[sometimewoodworker]

2 hours ago, alanrchase said:

I don't think trying to remit pre 2024 money will work. Tax authorities are not daft. I suspect all tax authorities consider that the tax years income is spent first before you dip into savings. If you have income of $20,000 in a year they will not consider any money to be savings till you have used up that $20,000.

This is where having more than a single account is useful, if you can show that the income was saved and that the remitted funds come from an account that was exclusively pre 2014 funds, no problem, no tax.

[JBChiangRai]

41 minutes ago, PJ71 said:

You actually don't.

 

I work in a country where i don't pay tax, stay half the year in Thailand where i don't work, neither are my home country which i'm tax domicile from.

 

I've not paid tax anywhere since approx. 1996/97 nor will i ever pay tax anywhere.

Do you stay 180 days or more in the country where you work?

 

If you do, you are tax resident there. They may have no income tax so nothing is payable.

[jayboy]

48 minutes ago, alanrchase said:

I suspect there will be a need to prove the money is savings

 

I think one must definitely have the receipts/evidence to prove the money comes from savings if required.But i doubt it will be called for except in the most exceptional circumstances.

 

51 minutes ago, alanrchase said:

I suspect they will consider money remitted to Thailand to be from income first until it is all used up

No reason to think this will be the case (especially if no tax return is filed on basis no assessable income!)

 

53 minutes ago, alanrchase said:

It will all be moot if they decide to tax worldwide income anyway.

Agreed

[PJ71]

20 minutes ago, JBChiangRai said:

Do you stay 180 days or more in the country where you work?

 

If you do, you are tax resident there. They may have no income tax so nothing is payable.

Yes, just over 180 days.

 

No, i'm not tax resident there.

[JBChiangRai]

8 minutes ago, PJ71 said:

Yes, just over 180 days.

 

No, i'm not tax resident there.

 

There are some countries where you may not be tax resident staying 183+ days per year, I don't know about yours as I don't know the country.

 

But if you are not tax resident anywhere, then it depends on 2 other things, the country where you maintain a permanent home and that countries tax rules, and your nationality.  Some nationalities are considered to be tax resident in their home country if they are not tax resident anywhere else and some countries consider you tax resident if you maintain a permanent home there and do not stay the 180/183 days per year and are not tax resident anywhere else.

 

 

[PJ71]

2 hours ago, JBChiangRai said:

 

There are some countries where you may not be tax resident staying 183+ days per year, I don't know about yours as I don't know the country.

 

But if you are not tax resident anywhere, then it depends on 2 other things, the country where you maintain a permanent home and that countries tax rules, and your nationality.  Some nationalities are considered to be tax resident in their home country if they are not tax resident anywhere else and some countries consider you tax resident if you maintain a permanent home there and do not stay the 180/183 days per year and are not tax resident anywhere else.

 

 

I maintain a permanent home in thailand, i pay zero tax, i'm in thailand less than 180 days, normally about 160.

 

I work in various other countries whilst not in thailand, i am resident in none of them.

[BritManToo]

My legal strategy is to not fill out a Thai tax return and hope they don't notice me.

[JBChiangRai]

18 minutes ago, PJ71 said:

I maintain a permanent home in thailand, i pay zero tax, i'm in thailand less than 180 days, normally about 160.

 

I work in various other countries whilst not in thailand, i am resident in none of them.

I don’t know whether Thailand would consider you tax resident. Or whether your home country would consider you tax resident.

 

You would need professional advice, if you haven’t already had it.

 

Maintaining a permanent home and bank account in Thailand might make a difference.

 

However, to repeat what I have said before, nothing has changed, nobody needs to do anything different than previous years, except regarding Crypto. Don’t start filling in tax returns.

[Ben Zioner]

13 minutes ago, BritManToo said:

My legal strategy is to not fill out a Thai tax return and hope they don't notice me.

That's extremely risky. If I did that and was caught after 5 years it would cost  me over 10 Million, while "only" 4.3 Million if I duly paid my tax while these 4.3 might become 0, because of my visa.

[Bday Prang]

So what if one arranges for a trusted acquaintance to open a bank  account in their name back in ones home country, which one then funds with ones own money, and retains possession of the ATM card to use whilst in Thailand.    Seems like an easy enough way to get cash into the country, one would just need to ensure one selected an account with the minimum card charges for foreign transactions

[ukrules]

4 minutes ago, JBChiangRai said:

I don’t know whether Thailand would consider you tax resident.

 

You need to stay for 180 days to be considered a tax resident in Thailand, you can't just opt in as you please without putting in the required number of days present.


 

6 minutes ago, JBChiangRai said:

except regarding Crypto

 

What changed for crypto?

[JBChiangRai]

17 minutes ago, BritManToo said:

My legal strategy is to not fill out a Thai tax return and hope they don't notice me.

 

9 minutes ago, Ben Zioner said:

That's extremely risky. If I did that and was caught after 5 years it would cost  me over 10 Million, while "only" 4.3 Million if I duly paid my tax while these 4.3 might become 0, because of my visa.

Nonsense.  Nothing has changed, do nothing and under no circumstances fill out a tax return if you haven’t been doing so in the past.

[PJ71]

12 minutes ago, JBChiangRai said:

I don’t know whether Thailand would consider you tax resident. Or whether your home country would consider you tax resident.

Why would they, i'm in the UK below the 90 day threshold and i'm in thailand below the 180 day threshold ( if it ever happens ).

 

13 minutes ago, JBChiangRai said:

You would need professional advice, if you haven’t already had it.

What for? it's obvious i'm not liable for tax anywhere

 

13 minutes ago, JBChiangRai said:

Maintaining a permanent home and bank account in Thailand might make a difference.

2 condos, 3 bank accounts.

 

I'm not concerned about any tax anywhere, i'm doing nothing wrong plus like many things in Thailand i'd imagine it'll never happen, way to difficult for them to regulate.

[Bday Prang]

13 minutes ago, Ben Zioner said:

That's extremely risky. If I did that and was caught after 5 years it would cost  me over 10 Million, while "only" 4.3 Million if I duly paid my tax. (these 4.3 might well be 0, because of my visa).

Maybe so but if your tax liability really is 4.3 million baht you are obviously not an "average" expat and could well be subject to further scrutiny as due to the amount of money you are dealing with ,  the tax department  would probably consider auditing you  a cost  effective exercise.  As for the rest of us ........hardly worth their trouble, 

[PJ71]

11 minutes ago, Ben Zioner said:

That's extremely risky. If I did that and was caught after 5 years it would cost  me over 10 Million, while "only" 4.3 Million if I duly paid my tax while these 4.3 might become 0, because of my visa.

So you're happily going to pay whatever tax Thailand decides to charge you ( if it happens )?

[JBChiangRai]

1 minute ago, ukrules said:

 

You need to stay for 180 days to be considered a tax resident in Thailand, you can't just opt in as you please without putting in the required number of days present.


 

 

What changed for crypto?

 Authorised Thai exchanges now report annual summaries to the revenue department identifying all trades.

 

Personal income tax is due on the profit of a trade if you bought your crypto on an authorized Thai exchange.

 

If you didn’t buy it on an authorized Thai exchange, for example, you bought it overseas, then you pay personal income tax on the full sales or trade amount as you exchange it for another crypto or FIAT. 

[JBChiangRai]

1 minute ago, PJ71 said:

Why would they, i'm in the UK below the 90 day threshold and i'm in thailand below the 180 day threshold ( if it ever happens ).

 

What for? it's obvious i'm not liable for tax anywhere

 

2 condos, 3 bank accounts.

 

I'm not concerned about any tax anywhere, i'm doing nothing wrong plus like many things in Thailand i'd imagine it'll never happen, way to difficult for them to regulate.

I agree with your last paragraph, do nothing.

[PJ71]

2 minutes ago, JBChiangRai said:

 

Nonsense.  Nothing has changed, do nothing and under no circumstances fill out a tax return if you haven’t been doing so in the past.

Totally agree, do nothing is the best thing right now.

 

I'd say middle of next year before we start seeing reports of people getting taxed ( or not ).

[PJ71]

1 minute ago, JBChiangRai said:

 Authorised Thai exchanges now report annual summaries to the revenue department identifying all trades.

 

Personal income tax is due on the profit of a trade if you bought your crypto on an authorized Thai exchange.

 

If you didn’t buy it on an authorized Thai exchange, for example, you bought it overseas, then you pay personal income tax on the full sales or trade amount as you exchange it for another crypto or FIAT. 

I have zero crypto.

[ukrules]

Just now, PJ71 said:

I have zero crypto.

 

It's not all about you. I keep some crypto and it's very applicable to me.

[MikePBrown]

My plan for minimising Thailand Income tax liability is set out below and may apply to some others in Thailand but it is also dependent on whether the Thai Revenue Depart allow capital loss offsets.

My main source of retirement funds is from invested capital that I earned pre 1/1/24. A portion of this is invested in stocks (off shore to Thailand) and generally these stocks were bought with capital pre 1/1/24.

When I need funds to pay for my retirement in Thailand I intend selling some of my stocks and then transferring the proceeds to Thailand which would be part capital (exempt from Thai Income Tax as the capital existed pre 1/1/24) and part capital gains (liable for Thai Income Tax). Some of my stocks have significant capital losses and I am planning on selling some of these with some of my stocks with capital gains at the same time and then transferring the combined realised monies to Thailand.

In such a situation it is the normal practice in other countries to allow capital losses to be offset against capital gains, and although these monies would be treated as income in Thailand I am assuming an offset would still be permitted. Does anyone have a view or knowledge on this matter?

I also understand that the capital gains/losses on stocks purchased pre 1/1/24 will need to be calculated from purchase price rather than the valuation as of 31/12/23. Can anyone confirm whether this is correct?

Finally for monies transferred from say a bank account is the normal practice to use first in, first out to identify the source and hence liability for Income Tax on any money transferred to Thailand.

[Ben Zioner]

10 minutes ago, PJ71 said:

So you're happily going to pay whatever tax Thailand decides to charge you ( if it happens )?

Happily? definitely not. But I have spent my first 10 years here not paying a cent. If I die (at 77) in 5 years time I'll end up paying 5% over 15 years, not such a bad deal after all. And I might do better with the LTR.

[JBChiangRai]

Just remember this.

 

If the Revenue Department want us to pay tax, they will announce it.

 

They are between a rock & a hard place, their own citizens will be in uproar if they say we are special and we don’t need to pay it. Their silence speaks volumes.

 

Until they say otherwise, don’t pay any “doom & gloom tax fee-seeking professionals” just sit still and do sweet F.A.

 

As printed on the cover of the hitchhikers guide to the galaxy “DON’T PANIC!”

[jmd8800]

On 5/19/2024 at 9:00 AM, JimGant said:

Excellent point. For example, per the US-Thai DTA -- if I remit a private pension to Thailand, Thailand gets first taxation rights and the US secondary taxation rights (under the saving clause). As such, Thailand keeps all the taxes collected, and the US absorbs a tax credit for those Thai taxes. Pretty important point, if a country is concerned about getting all the taxes it's entitled to under the DTA.

 

As such, this from the 'Intro to personal income tax....' is misleading:

 

 

In my US example, private pensions taxed in the US *would* be subject to Thai taxation -- as the DTA is currently written. As such, Thailand, having primary taxation authority on this private pension, could tax this income over again after the US has taxed it. But in this case, it's not Thailand absorbing a US tax credit -- it's the US absorbing the credit, and losing in tax collection the amount of taxes paid to Thailand. Thailand gets to keep the whole enchilada.

 

Now we've heard rumblings that Thailand will not bother to tax foreign income, as long as it's been taxed in the home country. If so, this is a real lazy approach that, yeah, avoids having to deal with tax returns of foreigners. But also gyps Thailand out of revenue allowed by DTA. Thailand can do this without violating the DTA, since the OECD has dictated that domestic laws that change a DTA are allowed -- as long as they don't materially affect the intent of the DTA. And in this case, protection against double taxation is not affected. But, will Thailand really want to cheat themselves out of money they're entitled to? Stay tuned, I guess.

Late to the party here, but are you saying that private pensions paid from work and recorded with the USA IRS with 1099=R is taxable in Thailand if I am in the country more than 180 days? I also have Social Security. After reading this I am thinking my SS won't be taxed but my 2 private pensions will. Since I am transferring 65K a month for Immigration purposes, this might be a pretty big deal.

[Yellowtail]

5 minutes ago, jmd8800 said:

Late to the party here, but are you saying that private pensions paid from work and recorded with the USA IRS with 1099=R is taxable in Thailand if I am in the country more than 180 days? I also have Social Security. After reading this I am thinking my SS won't be taxed but my 2 private pensions will. Since I am transferring 65K a month for Immigration purposes, this might be a pretty big deal.

Worst case for you, I think it will be less than 10%

[gamb00ler]

On 5/18/2024 at 9:00 PM, Lacessit said:

1/ Getting married to a Thai, to take maximum advantage of allowances.

Merely out of curiosity, does the citizenship/Immigration status matter?

[jmd8800]

24 minutes ago, Yellowtail said:

Worst case for you, I think it will be less than 10%

10% of what? The total amount I remit to Thailand each year?