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

[stat]

On 8/27/2024 at 10:05 AM, 4MyEgo said:

 

Gold shops, over the counter exchanges, no ID required, thanks for coming, oh and a better exchange rate, but Mum's the word 🙂

 

Please name one gold shop with a better exchange rate then superrich.

[Phulublub]

40 minutes ago, Robin said:

Thanks for the answers.  I will just have to wait and see what happens.  I will try for the non tax resident method when I have sold the house in UK, or hope that the situation has been clarified.

I think that savings is a concept that Thais do not understand; 'if you have money, spend it'   is more Thai.

To my simple mind, "Savings" could be defined as income not spent, but kept in an accessible place.  My dictionary gives "money put aside for future use"

In UK the money is kept in a "Savings account"   as it might be in Thailand.   Good enough for he RD?

First up, why the totally irrelevent Thai bashing?  How good are the majority of UK at saving (hint: many live on their credit cards) .  How many in the US literally live paycheck to paycheck? (as an aside, the new rules are aimed at those Thais who DO save, offshore, and have previously removed any tax liability by remitting in future years; that expats are in the same boat in a side effect - but for many of us, most of the time, there will actually be little or no actual tax to pay).

 

Secondly, savings are savings.  There are savings accounts here too.  The issue is whether they are classed as Assessable when remited to Thailand under the new rules.  You pay tax on returns from your savings in the UK (unless in an ISA), don't you?   All that matters is whether they were held at 31 Dec 23, or the classification of the income from which they are saved.  The only change  the new rules have brought in is that deferring the remittance to a following tax year does not turn remited funds (in whatever form) from assessable to non-assessable.  Whether you, I or anyone else calls them savings, or not, is not relevant to their status.

 

PH

 

Edited August 28 by Phulublub

[Lorry]

1 hour ago, Robin said:

I think that savings is a concept that Thais do not understand; 'if you have money, spend it'   is more Thai.

I have never quite understood what all these posters talking about "savings", related to taxes, mean. You evade taxes,  that makes it savings,  and you are out of the woods??? Never mind. 

(I figure it's one of those British idiosyncracies like non-doms, imperial fluid ounces and quarter miles (sorry if I confuse things))

This whole notion doesn't exist in my home country. 

I am not Thai. 

 

Edited August 28 by Lorry

[Lorry]

1 hour ago, chiang mai said:

Some people will try and say that there's no such thing as savings which I do not believe for one moment. Those people always want to trace the origin of the funds, even if it means going back many years.

That's how it's done in my home country. 

[chiang mai]

1 minute ago, Lorry said:

That's how it's done in my home country. 

Not sure what you're saying here, that there's no such thing as savings, not even with a time limit?

[Lorry]

3 minutes ago, chiang mai said:

Not sure what you're saying here, that there's no such thing as savings, not even with a time limit?

Afaik time limit is 2 decades.

PS but I really don't understand the whole idea of "savings".

The time limit is the statute of  limitations. 10 year old income is income. And taxed as income. Simple. TRD seems to follow this rule, too. Statute of limitations in Thailand 10 years. 

Edited August 28 by Lorry

[chiang mai]

1 minute ago, Lorry said:

Afaik time limit is 2 decades.

Wow! 

 

But the statute of limitation on tax in the UK is what, 7 years, the US is 10 years. Here it's either 3 or 10, based on whether you've filed or not. 2 decades to prove savings doesn't seem necessary or realistic.

[oldcpu]

On 8/26/2024 at 9:21 AM, Presnock said:

Well read the benefits on the BOI LTR page.  when I applied and got my LTR is says exempt from remitted foreign income

taxes and I don't see else that can be interpreted by the "experts".  All must always be aware of what they read here and on the YouTube tax experts as almost all of it is rumor mill info.  WE expats will know maybe once the new tax forms are published in "Nov/Dec" if that happens or maybe not until after Jan 2025 when anyone with assessable income is supposed to file for taxes.  If the DTA protects your income or you are exempted elsewhere then why even think about it at all.  Amazing to continue hearing some of the same stories months and months continuously.  Best of luck to all.

 

I don't dispute what you posted.

 

But I add to that, (and I have typed this before) that the translation for Royal Decree 743 (on the LTR visa) states "Governing Reduction of Tax Rates and Exemption of Taxes".

 

Note the word "exemption" . It does not translate to "Non-assessable for taxes". It clearly does NOT translate that way.

 

Then read the text for Royal Decree 743 (on the LTR Visa). Section-5 for the Wealthy Global Citizen and for the Wealthy Pensioner, and for the Work from Thailand Professional, translates to state they "shall be exempted ... for assessable income under section-40 of the Revenue code derived in the previous year from an employment or business carried on abroad, or from a property situated abroad, and brought into Thailand".  Note the word "exempted". 

 

The points people make here in the Royal Decree 743 are:

 

(1) "exempted for assessable" income may not be NOT the same as "not-assessable" income.  If it was not-assessable, why not simply state "not assessable". Instead "exempted for assessable" was translated. Was this something lost in translation?    Typically if an item has tax exemption, it is listed on an income tax return, and then subtracted from the assessable income. The Thai tax forms have a specific form where tax exempt income is to be listed.

 

(2) also, in the Royal Decree note the words "income ... derived in a previous year ... and brought into Thailand".   Some are worried that it is written that way with the intent to force those on the LTR (WP and WGC) to bring their income into Thailand in the year it was earned (so not to pay tax) ... with a concern that in the future, its possible foreign income earned abroad and not brought it, could be taxed if one a Thai resident. That is NOT the case today, but the head of the Revenue department has stated that is what he wants to implement. However, as I noted, a discussion my wife had on the phone with the local Revenue Department official was that even as a resident, if the foreign income was not brought into Thailand, it did not have to be taxed in Thailand and an income tax return not needed.  Hence for the moment, I think there is no concern there (if foreign income not brought into Thailand) - but it is something to watch carefully.

 

Further, the Royal Decree 743 section 6 states "A foreigner .... must meet qualifications and comply with rules, procedures and conditions as prescribed by the Director General of the Revenue Department."

 

I believe nominally, the section-6 " rules, procedures and conditions", together with one having an income over a certain amount of money, together with one being a Thai resident (by staying >180 days in Thailand) means that one may need to file a Thai tax return.  Again, I note LTR foreign income is to be 'tax exempt'. However the LTR visa does not clearly state "not-assessable" income.  I think those on LTR-WP/WGC visa all hope the Thai to English translation "exempted ... for assessable income" means "not-assessable income" - but we are dealing with translations and different words - where words can have meanings.

 

So, NOW, another point ...  further, on Royal Decree 743 section 7, the translation states "In the case that a foreigner has applied tax reduction or exemption under this Royal Decree, and later does not comply with rules described in Section-3, 4, 5, and 6 in any tax year, benefits will be suspended in that tax year."

 

ie. what some of us are watching, since the Royal Decree 743 states those on WP/WGC are tax exempt but does not state "tax not-assessable" will we need to file a tax return? (even thou we will pay no tax? ) .  The risk is if the Thai RD assesses a tax return is still needed, and we don't file a return, then Clause-7 implies our tax exempt benefits for  a given tax year will be lost.

 

I don't know the answer here.  This is something we all need to watch.  I set up my finances such that I can go for more than a couple of years in Thailand and not bring in any money, and by then, I hope there will be more clarification for those of us on the LTR WP/WGC visa.

 

Further, I was required by a couple of Canadian institutions to provide a Thailand TIN.  One even froze one of my Canadian trading accounts (that had a very substantial amount of money in it).  I was able to unfreeze it (for the moment) by providing my "pink-ID" number with a caveat that the TIN was not yet activated by Thailand.  And my wife had that confirmation (that my pink-ID not activated yet as a TIN) over the phone when chatting with a local Thailand Revenue Department official - who even questioned why I wanted a tax ID. 

 

I still have not resolved whether I will get an activated Thai TIN.  The local RD official was to phone my wife back, and he has not done so. Every few weeks I check to see if my pink-ID has been activated as a TIN, and it has not.

 

Depending on what I read (or do not read) on this topic of tax returns, I may in February fill in a Thai tax return in mid-February next year, and hand deliver it to the local Thai RD office.  I have not decided yet on that.  I may not do that.   I will be out of country in March/April, so February is my only opportunity to do such - and I have not decided on that.

 

My hope, like I think 95% (my figure) of others on the LTR-WP/WGC, is that no Thai tax return is needed, as it is just a bunch of extra possibly needless paper work for everyone.  Needless paperwork for us, and needless paper work for the Thai RD.

[JimGant]

9 minutes ago, oldcpu said:

"exempted for assessable" income may not be NOT the same as "not-assessable" income.  If it was not-assessable, why not simply state "not assessable". Instead "exempted for assessable" was translated.

You think too much. The Royal Decree allows LTR visa holders to treat otherwise "assessable income" as being the same as "not-assessable income" for taxation liability purposes.

[JimGant]

14 minutes ago, oldcpu said:

My hope, like I think 95% (my figure) of others on the LTR-WP/WGC, is that no Thai tax return is needed, as it is just a bunch of extra possibly needless paper work for everyone.  Needless paperwork for us, and needless paper work for the Thai RD

 Of course.

[sometimewoodworker]

23 hours ago, chiang mai said:

The answer to the house question is more complicated. 

Totally agree 

 

23 hours ago, chiang mai said:

Firstly, I assume your house was your primary residence, if so, there is no capital gains (CG) involved

If true, it quite possibly is, it is only relevant to HMRC it doesn’t effect TRD.

 

23 hours ago, chiang mai said:

If however you have rented the house out whilst you've been overseas and the house was not your primary residence, you would have to file UK CG.

Again that is the U.K. tax law
 

 

23 hours ago, chiang mai said:

If a CG was involved and those funds were imported to Thailand, the gain would be subject to Thai Personal Income Tax rates (PIT). It is unclear at this stage how the Thai Revenue (TRD) will view partial remittances of CG so this is an unknown.

Here it looks as if you are using U.K. rules and regulations to interpret how Thailand’s revenue department views things

 

the TRD view is

Quote

Most types of capital gains are taxable as ordinary income

 

 

23 hours ago, chiang mai said:

If your house was not subject to CG, you are left with principle and profit, none of which was taxable in the UK and which the UK would regard as savings.  Once again, it is not clear how the TRD will view those funds,

Once again you are commingling the HMRC & TRD views I don’t believe that the TRD will agree.

 

I believe that the TRD will take the simple view point that you purchased a property for X you sold the property for X times Y = Z therefore you have a capital gain of Z - Y. So if even you have not paid U.K. C.G.T.  All amounts remitted to Thailand that are over the initial purchase price (probably they will prorate the gain so a percentage of funds remitted are taxable) are assessable income, but only if you are tax resident this year and in future years (when the money is remitted), and the sale happened while you are tax resident, and you remit the proceeds while you are tax resident.

 

The U.K. DTC on capital gains while short is not remotely simple 

 

So it is impossible to answer your question as to will you have to pay Thai tax on the money from selling your house in the U.K.  

It is clear that in some circumstances yes you are liable to pay Thai tax.

It is also perfectly possible to arrange things so that you have no Thai tax liability on remitting the money

Edited August 28 by sometimewoodworker

[4MyEgo]

14 hours ago, stat said:

Please name one gold shop with a better exchange rate then superrich.

 

The gold shop that I use, (non name) of course, was usually half a baht, sometimes higher than Superpitch when I have exchanged money there, not to mention, no ID required, in with my countries currency, and out with Thai baht.

 

Perhaps you should shop around if you aren't or haven't been getting a better rate than Superpitch.

 

[sometimewoodworker]

16 hours ago, Lorry said:

It stems from the unclear formulation in TRD's Q&A. They stress several times that income from a year you were not tax resident can be remitted tax free.

The answer for the opposite question (income from a year I was tax resident,  remitted in a year I am not tax resident) is conspicuously absent.

I don’t agree that it is in anyway unclear.

 

The  answer question that you haven’t seen answered is blindingly obvious. If you are not tax resident in any year you have no tax to pay! How is that not clear!!!

[chiang mai]

1 hour ago, sometimewoodworker said:

Totally agree 

 

If true, it quite possibly is, it is only relevant to HMRC it doesn’t effect TRD.

 

Again that is the U.K. tax law
 

 

Here it looks as if you are using U.K. rules and regulations to interpret how Thailand’s revenue department views things

 

the TRD view is

 

 

Once again you are commingling the HMRC & TRD views I don’t believe that the TRD will agree.

 

I believe that the TRD will take the simple view point that you purchased a property for X you sold the property for X times Y = Z therefore you have a capital gain of Z - Y. So if even you have not paid U.K. C.G.T.  All amounts remitted to Thailand that are over the initial purchase price (probably they will prorate the gain so a percentage of funds remitted are taxable) are assessable income, but only if you are tax resident this year and in future years (when the money is remitted), and the sale happened while you are tax resident, and you remit the proceeds while you are tax resident.

 

The U.K. DTC on capital gains while short is not remotely simple 

 

So it is impossible to answer your question as to will you have to pay Thai tax on the money from selling your house in the U.K.  

It is clear that in some circumstances yes you are liable to pay Thai tax.

It is also perfectly possible to arrange things so that you have no Thai tax liability on remitting the money

Love your DIY knowledge but you should remain silent on tax related matters.

[Henryford]

I don't understand this concept of savings. If you had 10 million baht in your bank in the UK on 31.12.2023 but had income during 2024 of 3 million baht. If you remit 3 million baht to Thailand in 2024 is that part of your 10 million savings (not assessable) or your income (assessable).

Edited August 29 by Henryford

[Lorry]

2 hours ago, sometimewoodworker said:

I don’t agree that it is in anyway unclear.

 

The  answer question that you haven’t seen answered is blindingly obvious. If you are not tax resident in any year you have no tax to pay! How is that not clear!!!

Read the first tax thread and you will see  that it's (surprisingly) unclear. Discussed at least on 2 occasions. 

I know it's "blindingly obvious" if you follow the (letter of the) law.

[Lorry]

2 hours ago, 4MyEgo said:

usually half a baht, sometimes higher than Superpitch

Hard to believe if you have USD or EUR, or a similarly popular currency. 

If they pay you half a baht more for your currency than Superrich, it would be cheaper for them to buy the currency from Superrich, not from you.  At Superrich, the spread of common currencies is less than 50 satang, more like 15 satang.

[Lorry]

24 minutes ago, Henryford said:

I don't understand this concept of savings. If you had 10 million baht in your bank in the UK on 31.12.2023 but had income during 2024 of 3 million baht. If you remit 3 million baht to Thailand in 2024 is that part of your 10 million savings (not assessable) or your income (assessable).

If you comingle both funds by putting them into the same UK account, it's unclear.  We don't know whether TRD will use FIFO (first in, first out - if they do, your remittance would be savings) or another way.

Discussed many times in the tax  thread, often mentioned by @stat

[motdaeng]

30 minutes ago, Henryford said:

I don't understand this concept of savings. If you had 10 million baht in your bank in the UK on 31.12.2023 but had income during 2024 of 3 million baht. If you remit 3 million baht to Thailand in 2024 is that part of your 10 million savings (not assessable) or your income (assessable).

 

i am not a tax expert at all, but this is how i would approach it:

if my portfolio (savings, investments, but without property, car, valuables, etc.) amounts to 10 million baht as of 31.12.2023,

and i have proof like a bank statement. under the current tax law, i could transfer a total of 10 million baht to thailand

(either in one year or over a  time of a few years) without having to pay taxes. the income or profit from 2024 onwards will

not turn into savings, neither now nor in the coming years.

 

however, i wouldn't push at this moment the boundaries of the "saving law" too far, with property or stockmarket selling etc

[chiang mai]

41 minutes ago, Henryford said:

I don't understand this concept of savings. If you had 10 million baht in your bank in the UK on 31.12.2023 but had income during 2024 of 3 million baht. If you remit 3 million baht to Thailand in 2024 is that part of your 10 million savings (not assessable) or your income (assessable).

 

13 minutes ago, Lorry said:

If you comingle both funds by putting them into the same UK account, it's unclear.  We don't know whether TRD will use FIFO (first in, first out - if they do, your remittance would be savings) or another way.

Discussed many times in the tax  thread, often mentioned by @stat

One member reported that he had been called in to discuss tax matters by the Bangkok office and the issue of "savings" versus income was discussed. He reported that the officer considered that the value of the pre 12/31/23 account would determine whether its contents were income or exempt under Por 162. As that account was reduced in line with remittances, so would the level of exempt savings. Apparently there was no discussion about what might happen if the value of the funds increased. This is only one member and one officers view which is very simplistic. It does however underscore the importance of trying not to commingle Por 162 exempt funds, with income.

[chiang mai]

1 minute ago, motdaeng said:

 

i am not a tax expert at all, but this is how i would approach it:

if my portfolio (savings, investments, but without property, car, valuables, etc.) amounts to 10 million baht as of 31.12.2023,

and i have proof like a bank statement. under the current tax law, i could transfer a total of 10 million baht to thailand

(either in one year or over a  time of a few years) without having to pay taxes. the income or profit from 2024 onwards will

not turn into savings, neither now nor in the coming years.

 

however, i wouldn't push at this moment the boundaries of the "saving law" too far, with property or stockmarket selling etc

I fully agree.

[Robin]

TRy to calm down some of the replies to my postings:

I am in Thailand on a retirement visas using 800KB n the bank as source of funds.

I have never worked in Thailand, so never had to bother with a Tax return,  I cannot speak for my wife, as i do not interfere with her financial affairs.

For many years, when working in Offshore, I was non-resident in UK, but paid UK taxes for 'unearned income'. Tax returns were prepared and approved by a professional accountant, and not questioned by HMCR

Now I am fully retired, and had hoped to live out my life in Thailand, having saved and invested enough to keep wife any my self for the rest of our lives.  The Seetha Government tax proposals have become a worry, but I am hoping that I can survive, using the non-tax-resident method.  

It will be interesting to see if Taksin, originator of he retirement visa, and perhaps more expat friendly in tax thinking, keeps with Seetha's proposals.

As regards selling property  in UK, I am familiar with CGT rules and not in need of any advice, only the question  of is the value of the property 'savings' (noun) or not 

[chiang mai]

25 minutes ago, Robin said:

TRy to calm down some of the replies to my postings:

I am in Thailand on a retirement visas using 800KB n the bank as source of funds.

I have never worked in Thailand, so never had to bother with a Tax return,  I cannot speak for my wife, as i do not interfere with her financial affairs.

For many years, when working in Offshore, I was non-resident in UK, but paid UK taxes for 'unearned income'. Tax returns were prepared and approved by a professional accountant, and not questioned by HMCR

Now I am fully retired, and had hoped to live out my life in Thailand, having saved and invested enough to keep wife any my self for the rest of our lives.  The Seetha Government tax proposals have become a worry, but I am hoping that I can survive, using the non-tax-resident method.  

It will be interesting to see if Taksin, originator of he retirement visa, and perhaps more expat friendly in tax thinking, keeps with Seetha's proposals.

As regards selling property  in UK, I am familiar with CGT rules and not in need of any advice, only the question  of is the value of the property 'savings' (noun) or not 

Even Thai people have savings, there is no reason why foreigners can't have them also for tax purposes. But your house sale proceeds may not instantly become savings, honestly we don't know how the TRD will treat those proceeds under their interpretation of DTA rules. In a worst case scenario, the remittance of the sale proceeds would be taxed under Thai Personal Income Tax rules and you would need to invoke the DTA to offset the CG tax paid in the UK to offset any liability here.

 

Operative phrase, nobody knows.

[stat]

10 hours ago, 4MyEgo said:

 

The gold shop that I use, (non name) of course, was usually half a baht, sometimes higher than Superpitch when I have exchanged money there, not to mention, no ID required, in with my countries currency, and out with Thai baht.

 

Perhaps you should shop around if you aren't or haven't been getting a better rate than Superpitch.

 

Apparently you do not know that it is superich and not superpitch...

 

In addition if there is a half baht difference  you have found the infinite money glitch as the spread between buy and sell at superrich is only 6 satang. So go exchange euro for Baht at the unnamed Gold shop and then exchange the baht back to Euro at SuperPITCH.

I bet they also sell genuine gems for half the market price...

[stat]

7 hours ago, motdaeng said:

 

i am not a tax expert at all, but this is how i would approach it:

if my portfolio (savings, investments, but without property, car, valuables, etc.) amounts to 10 million baht as of 31.12.2023,

and i have proof like a bank statement. under the current tax law, i could transfer a total of 10 million baht to thailand

(either in one year or over a  time of a few years) without having to pay taxes. the income or profit from 2024 onwards will

not turn into savings, neither now nor in the coming years.

 

however, i wouldn't push at this moment the boundaries of the "saving law" too far, with property or stockmarket selling etc

IMHO it depends in the case of investment. Example

 

100.000 USD bought Apple in 2015

2024 worth 500.000 USD

 

If you then sell the stock while being tax resident in TH in 2025 I assume only the 100K are safe from taxation while the 400k could/are taxable when remitted to TH. No one knows if the first 100K are tax free or if they calculate the tax based on a mix.

 

Only cash i.e. money in an account should be tax free.

[sometimewoodworker]

11 hours ago, Lorry said:

Read the first tax thread and you will see  that it's (surprisingly) unclear. Discussed at least on 2 occasions. 

I know it's "blindingly obvious" if you follow the (letter of the) law.

Just because people don’t know the letter of the law doesn’t make it in anyway uncertain. Nor does uninformed discussion change anything. 

[sometimewoodworker]

12 hours ago, chiang mai said:

Love your DIY knowledge but you should remain silent on tax related matters.

Who pronounced you as the ultimate authority on tax matters?

 

I know a of at least one area where your position is in direct conflict with some rather highly placed professionals who are in direct contact with those who are at the top levels of the TRD so have an actual current knowledge.

 

FWIW no I’m not bothering to correct your misinformation, you are welcome to continue.

[NoDisplayName]

11 hours ago, Henryford said:

I don't understand this concept of savings. If you had 10 million baht in your bank in the UK on 31.12.2023 but had income during 2024 of 3 million baht. If you remit 3 million baht to Thailand in 2024 is that part of your 10 million savings (not assessable) or your income (assessable).

 

For the time being, and most likely into the foreseeable future, TRD should be satisfied with OUR self-determination of whether remitted funds are assessable.

 

I'm not aware of anyone who has gone into a tax office to inquire about filing and been questioned further after stating that remittances were from 'savings.'

[chiang mai]

4 minutes ago, sometimewoodworker said:

Who pronounced you as the ultimate authority on tax matters?

 

I know a of at least one area where your position is in direct conflict with some rather highly placed professionals who are in direct contact with those who are at the top levels of the TRD so have an actual current knowledge.

 

FWIW no I’m not bothering to correct your misinformation, you are welcome to continue.

I'm certainly not that and don't regard myself as anything close to it. It's just that you've tried to inform others with no small amount of authority on points that were completely incorrect. You've argued that there is a blanket expense for all remitted income, including investment funds and told members that CG is due on UK house sales, as well as other incorrect aspects of tax. If you don't know and have had no training or first hand experience, it would be better to say nothing, unless you state it clearly as an opinion. 

[Lorry]

6 hours ago, sometimewoodworker said:

Just because people don’t know the letter of the law doesn’t make it in anyway uncertain. Nor does uninformed discussion change anything. 

You can be a bit stubborn, you know?

I said from the beginning that the TRD's Q&As read very suspicious. 

They keep stressing that money earned in a year you weren't tax resident can be remitted tax free.

And they keep quiet about the other way round - money earned in a year you were tax resident,  remitted in a year you are not a tax resident. 

It makes for very strange reading. 

The posters discussing it in the tax thread have the same level of information as you or me, the RC is not so difficult to understand. So don't call everybody "uninformed".

I came very early to the conclusion  that any amount of money can be remitted tax-free in a year I am not a tax resident. Even it's a huge loophole.

 

But I don't want to discuss this with Somchai the tax inspector. Many posters have said,  just remit a lot of money in a year you only stay 179 days,  and live on it for the next years. Rinse and repeat.

Somchai won't like this. 

 

If I were to remit several millions, I would remit them in a year I am not a tax resident and I would remit income I earned in a year I was not a tax resident.

It's just one more layer of protection, most probably completely unnecessary.

That's what I would do, feel free to act differently.

Edited August 29 by Lorry