Thai gov. to tax (remitted) income from abroad for tax residents starting 2024 - Part II

[JimGant]

5 minutes ago, JohnnyBD said:

I was just pointing out that if I remitted the principle & capital gains, I get to choose the cost basis method I use, not TRD.

I guess switching to worldwide taxation will finally shut down all these remittance based discussions. I have no doubt that that's where we're headed.

[JohnnyBD]

7 minutes ago, JimGant said:

I guess switching to worldwide taxation will finally shut down all these remittance based discussions. I have no doubt that that's where we're headed.

I agree. No doubt here either. That's when I will start staying less than 180 days. I'm still waiting for my LTR to be approved, but I doubt that will save us.

Edited Monday at 12:10 PM by JohnnyBD

[Captain Flack]

Post against forum rules removed. Lets keep the posts on topic and stop the personal attacks/bickering or accept further action will be taken.

 

Rule 9. You will not post disruptive or inflammatory messages. You will respect other members and post in a civil manner. Personal attacks, insults or hate speech posted on the forum or sent by private message are not allowed.

[Mike Teavee]

2 hours ago, NoDisplayName said:

See Sherrings/TRD question 9.

That simply means it's up to you to decide whether income you're remitting is assessable or not. 

 

In the context of the CGT debate you may assess that the money you're bringing over is the original income so is not assessable, I believe you're wrong & part of it is assessable but it would only matter if TRD ever audited you. 

 

 

[NoDisplayName]

7 minutes ago, Mike Teavee said:

That simply means it's up to you to decide whether income you're remitting is assessable or not. 

 

In the context of the CGT debate you may assess that the money you're bringing over is the original income so is not assessable, I believe you're wrong & part of it is assessable but it would only matter if TRD ever audited you. 

 

 

 

I'm just going by the TRD response, that I can use "facts and evidence" to support that I am remitting capital, NOT income.

 

Question 9: If yearly, I invest abroad and bring part of it back into Thailand, is the part I bring back into Thailand determined as capital or as assessable income?

Answer: For monies that are brought into Thailand, taxpayers have a duty to self-determine, based on facts and evidence, if the monies brought into Thailand are capital or assessable income.

[dinga]

For goodness sake, while the system is based on self-assessment what matters is what the TRD determines (NOT what the taxpayers believe).

 

Can't believe we are in the never-ending loop that some folks continue to believe is terminated by the self-assessment 

[stat]

3 hours ago, Mike Teavee said:

No it wouldn't, FIFO would mean the oldest assets I own are sold first & then I'm taxed on the gain on those... 

 

E.g. £20,000 made up of:-

1. 5,000 shares at £1 
2. 2,500 shares at £2
3. 1,250 shares at £4  

Lets say those shares are now worth £5....

1. FIFO means I sell 2,000 of the 1st tranche at £5 = £10,000 for a gain (excluding costs / taper relief etc...) of £8,000
2. LIFO means I sell 1,250 from the 3rd Tranche at £5 (realising £6,250 for a profit of £1,250) & 750 from my 2nd tranche (realising £3,750 for a net profit £2,250) Total profit = £3,500.

 

Edit: Apologies if any of the maths is off but the GF is nagging to go out for dinner, hopefully people will understand the point I'm trying to make.

 

There is a genuine misunderstanding here.

 

You are talking about FIFO for the calculation of the gain in the shares.

 

I am talking about what part of my proceeds are remitted to Thailand. If FIFO for the remittance is used the first monies that are remitted is my principal as it was first existent.

[stat]

4 hours ago, Mike Lister said:

Because that was the latest view that we observed which superseded the Sherrings statements, nothing was ignored, a view was taken based on the ExpatTax video and the Hua Hin interview with the TRD. Sorry if you don't like it but that's what happened, now stop being so argumentative and baiting..

No one selected you (or me) to be the arbiter of anything or declare something argumentative.

There are 2 different views in existence on remittance and you claim that the later one is correct (no connection to TRD as I am aware of) and the former from Sherrings wrong. Sherrings has actually spoken with TRD. Apparently there are quite a number of participants here who believe either view is possible or have different view which version is correct. However ML is the only one in this forum who is 100% sure about what is right and what is wrong.

 

 

Edited Monday at 02:41 PM by stat

[stat]

56 minutes ago, dinga said:

For goodness sake, while the system is based on self-assessment what matters is what the TRD determines (NOT what the taxpayers believe).

 

Can't believe we are in the never-ending loop that some folks continue to believe is terminated by the self-assessment 

It was pointed out that in the US one can self assess (Amazing to me as it is well defined in Germany what method has to be used ;-)) . It was also mentioned some hundred pages ago that in a different context (I think gifts) one could self determine the accounting method in Thailand. So again this topic is wide open if and which method could be used.

[atpeace]

1 hour ago, dinga said:

For goodness sake, while the system is based on self-assessment what matters is what the TRD determines (NOT what the taxpayers believe).

 

Can't believe we are in the never-ending loop that some folks continue to believe is terminated by the self-assessment 

I think most get this but you have no clue how the new tax regs will be implemented.  That is why this keeps going full circle and I stated this on the first thread months ago.  Everybody has to relax.  In all likelihood this will amount to nothing for 99% of expats here.  Mike keeps TRYING to clarify but it gets nowhere because he doesn't have a clue how it will be implemented.  If it makes you feel better to assume the worst case scenario - up to you. 

 

Preparing for the worst outcome while ignoring the most likely is ridiculous.  I can only assume Thais are pissing themselves at our insane fear. I know I am. These threads are hilarious and expect Thai government officials to come up with more scenarios that cause us to wet our selves for the pure entertainment value.  

 

 

 

 

Edited Monday at 03:00 PM by atpeace

[stat]

2 hours ago, atpeace said:

I think most get this but you have no clue how the new tax regs will be implemented.  That is why this keeps going full circle and I stated this on the first thread months ago.  Everybody has to relax.  In all likelihood this will amount to nothing for 99% of expats here.  Mike keeps TRYING to clarify but it gets nowhere because he doesn't have a clue how it will be implemented.  If it makes you feel better to assume the worst case scenario - up to you. 

 

Preparing for the worst outcome while ignoring the most likely is ridiculous.  I can only assume Thais are pissing themselves at our insane fear. I know I am. These threads are hilarious and expect Thai government officials to come up with more scenarios that cause us to wet our selves for the pure entertainment value.  

 

 

 

 

I would like to compare the scenario to the explosion of a nuclear power plant, while the likelihood is very very low if it explodes the consequences are catastrophic for some.

 

If you have high cap gains the difference in tax payment is so huge that you have to be prepared. I agree with you however that the likelyhood of a worst case scenario taxwise in TH is low IMHO 10-20%.

 

 

[Lorry]

8 hours ago, NoDisplayName said:

I predict that TRD won't bother with home country documents, except in certain exceptional cases.  They don't have the staff, the knowledge, the experience, to handle financial forms in foreign languages from 100+ other nations.

 

They'll simply do the simplest thing for simplicity.  Anything and everything remitted will be classed as assessable and taxed, unless you can show that a government pension was directly deposited to a Thai bank.  Up to you to claim benefits under tax treaty and file for a refund.  Elsewhere. 

 

I think this will be the most probable way they handle the new "remittance tax". Simple. 

And that's why my defense, as long as everything is unclear,  is just as simple: I don't remit anything anymore. 

Ok, I dare to remit 210,000 B (the tax free threshold).

I am confident my RD official won't say "oh, TEDA is for Thais only" (wouldn't surprise me, though).

 

The second possible defense,  just as simple: no more than 179 days in Thailand per calendar year.  I know from experience that this works,  and it's simple enough. 

 

But I don't want to rely on gift taxes, DTAs, loans/credit cards, FIFO/LIFO,  whatever. At least not now when things aren't clear. 

Because I think the TRD will not be interested in all my explanations and documentations.  With a stroke of a pen they can wipe away all my cleverly thought-out ideas.

 

I will reconsider in 2026/2027.

 

 

 

[KhunHeineken]

1 hour ago, Lorry said:

I think this will be the most probable way they handle the new "remittance tax". Simple. 

And that's why my defense, as long as everything is unclear,  is just as simple: I don't remit anything anymore. 

Ok, I dare to remit 210,000 B (the tax free threshold).

I am confident my RD official won't say "oh, TEDA is for Thais only" (wouldn't surprise me, though).

 

The second possible defense,  just as simple: no more than 179 days in Thailand per calendar year.  I know from experience that this works,  and it's simple enough. 

 

But I don't want to rely on gift taxes, DTAs, loans/credit cards, FIFO/LIFO,  whatever. At least not now when things aren't clear. 

Because I think the TRD will not be interested in all my explanations and documentations.  With a stroke of a pen they can wipe away all my cleverly thought-out ideas.

 

I will reconsider in 2026/2027.

 

 

 

Spot on. 

 

As foreigners, we have no rights here.  That retirement visa / extension is nothing more than a 12 month tourist visa. 

 

As I said before, the Thai government says" jump" and foreigners ask "how high?" 

 

We'll pay what they say we have to pay, right or wrong, and if we don't like it, either leave, or only stay 179 days in Thailand in the future. 

 

I'm staying this year, and they will get me for this year, if they do, Thailand will get me once.  That's the chance I am giving them. 

 

If I feel it's a rip off, it's Thailand 179 days, Vietnam for the rest of the year, with a few days in Singapore for the F1 to be under the resident for tax purposes days for both countries. 

 

Thailand is an unstable country, and I have never trusted the government or those in authority here, ever. 

[UKresonant]

Can I say it seems that the debate is trying to achieve a one size fits all conclusion.

 

There could be Lifo Fifo relating to progressive sale of segments of a single stock or insurance bonds or the like. But I think the vast majority of transactions will be proportional (remitted P+G in the applicable ratio%), like sale of houses in home country, it's a single transaction at a point in time (so it's all out).

Edited Monday at 10:47 PM by UKresonant

[UKresonant]

Thailand does seem to be on course to be a 179day per year destination for many.

If I we're 100% in Thailand and the DTA was simple in opperation, not such a great worry, though more tax. Can't see that happening though.

One of the family has kept to 177days +/- 2days  for about 20years. I've only once exceeded 179 days, but all previous years remittance, remaining compliant.

[Mike Teavee]

8 hours ago, stat said:

There is a genuine misunderstanding here.

 

You are talking about FIFO for the calculation of the gain in the shares.

 

I am talking about what part of my proceeds are remitted to Thailand. If FIFO for the remittance is used the first monies that are remitted is my principal as it was first existent.

Not a misunderstanding more of a divergence in what the Sherrings statement is saying, to me it is only referring to the way the Gain is calculated & makes no reference to how the proceeds are remitted which I believe is pro-rata.

 

Time will tell but in the meantime I won't be remitting any Capital Gains to Thailand until the position is crystal clear, same with Rental & Dividend income.

 

I wonder if Thailand has any idea how much money isn't being remitted because of the lack of clarity around this (I'm only remitting 235K for me & 210K for the GF this year & next, when normally it would be 4X that pa) or how many people are putting of large purchases (which is ironic given the very recent push to increase foreign ownership of condos / leased land).

[Mike Lister]

My apologies that I posted this earlier in the wrong thread....some food for thought perhaps:

 

The more I think about the possibilities, the more likely it appears that a two tier system will develop. Low(er) income types are likely to be ignored for tax purposes (unless an excuse is needed to catch them out, for whatever reason) whilst evaders and high income people are likely to be actively pursued. That negates the need for any kind of link to visa renewal at Immigration, which would only add another layer of complexity and bureaucracy to an already stressed system.

 

Over time, the number of people filing tax returns, even low income types, will increase as taxpayers attempt to stay on the safe side of the rules and that will increase the tax take somewhat. Dubious or criminal elements of the foreign resident community will be under significantly increased threat that they didn't file a return, the good old, Al Capone gotcha approach. Meanwhile, the tax agent/tax filing agent community will grow, until such time as everyone is required to file a return, at some distant point in the future. Meanwhile, face is saved all round and later next year, the program will be proclaimed a roaring success as wealthier foreigners gravitate towards the expensive long stay visa which is tax exempt.

 

I see a perfect fit with no downside, anywhere.

Edited Monday at 11:54 PM by Mike Lister

[Lorry]

7 hours ago, Mike Lister said:

evaders

I don't understand what do you mean by "evaders"?

If you mean every resident pensioner over the threshold of 400,000 who doesn't file taxes,  your post doesn't make a lot of sense. Whom do you mean?

 

Apart from this,  your post sounds very plausible. 

[Mike Lister]

19 minutes ago, Lorry said:

I don't understand what do you mean by "evaders"?

If you mean every resident pensioner over the threshold of 400,000 who doesn't file taxes,  your post doesn't make a lot of sense. Whom do you mean?

 

Apart from this,  your post sounds very plausible. 

Thais who evade taxes by maintaining offshore accounts that are unreported.

[Lorry]

2 minutes ago, Mike Lister said:

Thais who evade taxes by maintaining offshore accounts that are unreported.

Agreed

[stat]

On 6/24/2024 at 2:02 PM, JimGant said:

I guess switching to worldwide taxation will finally shut down all these remittance based discussions. I have no doubt that that's where we're headed.

This would more or less end the discussion I agree. TBH I have no idea how this ww taxation will play out. I do however think the yellow shirts will come to the rescue. Long live the king!

[stat]

13 hours ago, Mike Teavee said:

Not a misunderstanding more of a divergence in what the Sherrings statement is saying, to me it is only referring to the way the Gain is calculated & makes no reference to how the proceeds are remitted which I believe is pro-rata.

 

Time will tell but in the meantime I won't be remitting any Capital Gains to Thailand until the position is crystal clear, same with Rental & Dividend income.

 

I wonder if Thailand has any idea how much money isn't being remitted because of the lack of clarity around this (I'm only remitting 235K for me & 210K for the GF this year & next, when normally it would be 4X that pa) or how many people are putting of large purchases (which is ironic given the very recent push to increase foreign ownership of condos / leased land).

Thx for your post! I think for the remittance part the accounting method is not yet decided or even though about by TRD. I highly doubt there will be any clarification let alone a crystal clear one. The only crystal clear solution would be to postpone or scrap the new directive.

[stat]

13 hours ago, Mike Lister said:

My apologies that I posted this earlier in the wrong thread....some food for thought perhaps:

 

The more I think about the possibilities, the more likely it appears that a two tier system will develop. Low(er) income types are likely to be ignored for tax purposes (unless an excuse is needed to catch them out, for whatever reason) whilst evaders and high income people are likely to be actively pursued. That negates the need for any kind of link to visa renewal at Immigration, which would only add another layer of complexity and bureaucracy to an already stressed system.

 

Over time, the number of people filing tax returns, even low income types, will increase as taxpayers attempt to stay on the safe side of the rules and that will increase the tax take somewhat. Dubious or criminal elements of the foreign resident community will be under significantly increased threat that they didn't file a return, the good old, Al Capone gotcha approach. Meanwhile, the tax agent/tax filing agent community will grow, until such time as everyone is required to file a return, at some distant point in the future. Meanwhile, face is saved all round and later next year, the program will be proclaimed a roaring success as wealthier foreigners gravitate towards the expensive long stay visa which is tax exempt.

 

I see a perfect fit with no downside, anywhere.

There is a long discussion in the LTR Visa thread if the LTR visa will really be tax exempt, if they introduce ww taxation as only remitted income is tax exempt by the royal degree. I have written several emails to BOI and so far I have not received a clear statement if non remitted income will also be tax exempt. If you want to remit every penny the LTR may be fine. If you keep the main part your money offshore (as every responsible investor would do, flag theories etc) it is unclear if TH will tax.

 

Obviously the LTR visa would be the preferred solution if it really were tax exempt for anyone with 80K passive income per year.

Edited Tuesday at 01:06 PM by stat

[Mike Lister]

An interesting but directly related diversion here which now becomes necessary to avoid confusion by those members not familiar with the terminology.

 

HSBC defines offshore banking as,  “An offshore bank account (also known as an overseas or non-resident account) is one you open in a country or region other than where you live”. 

 

An article in USA Today below provides a reasonable overview of the subject.

 

Historically, offshore banks were located in territories that provided higher than average secrecy laws, which meant that customers could shield their wealth from the gaze of tax authorities. Times have now moved on hence the account secrecy aspect is no longer what it was, although the concept of offshore banking remains valid and in most cases, legal. There are many sound reasons why people hold offshore bank accounts, tax efficiency, product availability, legal threat shielding, funds seizure and convenience are just some of them. It therefore follows that offshore banks remain popular, legal and widely available, offered by some of the biggest names in banking. The message here is that offshore banks are generally safe, depending on the jurisdiction in which it is located.

 

https://www.usnews.com/banking/articles/what-is-offshore-banking

 

https://internationalservices.hsbc.com/international-banking/what-is-an-offshore-bank-account/.

 

In most cases, offshore bank accounts were never illegal, only the way in which they were used and the failure to report transactions was. Worldwide reporting and information interchanges have ensured better reporting for tax and legal purposes but such systems don't guarantee detection in every instance. Which is why some customers will continue to under report such accounts, in the continued hope of evading tax in their home region.

 

Thai onshore banks offer Foreign Currency Accounts for customers who are not Thai tax resident (as well as for residents) and these have some characteristics of an offshore account in that the tax treatment of those accounts represents and agreement between the bank and the TRD, onshore. It is therefore not true to say that those foreign currency accounts, are offshore accounts.

Edited Tuesday at 10:53 PM by Mike Lister

[dinga]

For a while now it has seemed to me folks are tying themselves up in knots, and causing themselves - and others -  unnecessary angst by triple guessing/pontificating upon what the TRD may do in applying the new & suggested personal tax changes.  While civil discussions about possible implications and differing views are very healthy, dogmatic insistence is not - especially when based on how Revenue Authorities in other countries act (this of course may be useful when considering risk management steps).

 

Some time ago, I related the story of the advice given by a very senior and hugely experienced Thai to "read the words - that's what the law means" - don't apply the typical farang approach of trying to interprete the meaning.

 

For what it's worth, here's a real example of how Thai tax authorities actually apply the Land & Building Tax [LBT] Law - which I reckon is diametrically opposed to how the Tax Department would proceed in my home country.

 

LBT is payable on 4 categories - including:

*  For Agricultural purposes:  Rate 0.15% - but exempt if the tax doesn't exceed 50 mill baht

*  Left empty or unused:  Rate 1.2% with additional amounts of 0.3% if empty/unused for each period of more than 3 years, to a maximum 3%

 

Everyday I drive past what had previously been vacant beachfront land - very, very valuable beachfront land.  Some time ago, these blocks were sparcely planted with a variety of plants  -  cassave; coconuts; gum trees; mangos etc.  Those plants being given minimal attention post planting - with the obvious purpose being for the owners to eliminate the LBT liability on land that is really being held for capital appreciation. 

 

While acceptable in Thailand ("read the words") it's hard/impossible to imagine a tax authority in any other country agreeing with the agricultural purposes claim.

 

Hope this example helps folks to balance consideration of worst case scenarios

 

          

[stat]

16 hours ago, Lorry said:

I know what he is talking about,  you are really splitting hairs here.

That's not completely true, even with CRS.

Anyway,  there WERE unreported offshore accounts until now, that's his point

Then name a respectable country where I would like to bank that will not report a 2025 account.

 

For Thais there was no tax to be paid on offshore accounts cap gains and interest in the past anyway. So come again what is ML talking about?

Edited Wednesday at 08:44 AM by stat

[Lorry]

2 hours ago, stat said:

Then name a respectable country where I would like to bank that will not report a 2025 account.

I think you are more familiar with CRS than I

But "where I would like to bank" may pose a problem. A friend of mine wouldn't like to bank in Germany,  others wouldn't like to bank in the US...

[stat]

3 hours ago, Lorry said:

I think you are more familiar with CRS than I

But "where I would like to bank" may pose a problem. A friend of mine wouldn't like to bank in Germany,  others wouldn't like to bank in the US...

We are talking about Guatemala, North Macedonia, Cambodia, Armenia etc those are the kind of countries that have not signed up to CRS/FATCA yet. I would rather pay taxes in Thailand then bank in Cambodia. I am talking banking and brokerage of course.  Brokerage is usually non existing in those countries.

 

BTW: Germany is a great country to bank, but a hellhole if you are a tax resident in Germany.

Edited Wednesday at 02:38 PM by stat

[Lorry]

1 hour ago, stat said:

I would rather pay taxes in Thailand then bank in Cambodia

Me too, but I don't have specific reasons except my general impression of Cambodia. 

Foreign friends who moved from Thailand to Cambodia think I am prejudiced. 

Can you name specific reasons?

 

BTW if asking for brokerage,  too, then I really wouldn't know any respectable place that's not in FATCA/CRS

Edited Wednesday at 04:10 PM by Lorry

[ukrules]

55 minutes ago, Lorry said:

Me too, but I don't have specific reasons except my general impression of Cambodia. 

Foreign friends who moved from Thailand to Cambodia think I am prejudiced. 

 

Cambodia is fine for storing some cash, I'm back in Thailand for a few weeks right now but when I return to Phnom Penh I'm going to open a new ABA account now I have my 1 year visa.