New Tax Rules for Expats in Thailand Spark Concern

[LudwigK]

We notice:

The Government does not like YOU....    BUT   YOUR   MONEY !!!!

[Mike Lister]

2 minutes ago, Dmaxdan said:

I've never really been that worried about filing a tax return and potentially paying tax in Thailand. In real terms I only transfer small amounts into Thailand each month.

 

But what does concern me big time is the actual logistics of doing a tax return properly.

I live in Chiang Mai province with, apparently 30,000 other long term expats.

How the hell are the RD in Chiang Mai going to process that many ignorant foreigner's tax returns within the first three months of the year???

We will all have to all camp out the night before just in the vain hope of getting a slot!!!

This is a side of this that the government hasn't thought through...

 

Okay, so maybe a percentage of the long term expats may work here and therefore pay tax on their salaries. But even so...

 

People will say "get an accountant or a financial advisor" but there can't possibly be enough English speaking advisors to go around. And none of them can start working for you until this year is over. 

You could get your TIN now and have the TRD set up your online account, that way you'd never need to go near the Revenue office to file.

[redwood1]

Folks I thought this tax was for EVERYONE in Thailand including Thais.....Not a word has been said about a new income tax for Thais....

 

It was also quite kind of them to come out with the LTR visa the  LTR excludes the richest expats from paying any tax..Which pores cold water on  saying the income tax is needed to raise money...When the most well-off expats are excluded from paying any tax.....

This half baked mess of a tax has more holes in it than Swiss cheese....Savings excluded,Gifts excluded, Treaties excluded, ATMs pretty much excluded etc etc etc

 

The whole thing is pretty much a hopeless mess.....

 

 

 

[Moonlover]

4 hours ago, tgw said:

I was led to this thread by the headline "

BREAKING: Expats in Thailand to face substantial tax bills

 

"

in my email.

 

can the authors please elaborate on the substantial tax bill we will face, and why that is not an hypothetical ?

 

Well, I've done quite a bit of surfing on this topic and I've come up with this little lot. Make of it what you will, but I as a pensioner whose income has already been taxed by the UK tax authorities don't feel in any way concerned about this 'new rule'.

 

 

The program will begin January 1, 2024 and apply only to tax residents in Thailand meaning tourists and short term workers will be exempt. Also exempt will be those who have been taxed in a foreign country that has a standing Double Tax Agreement with Thailand.

 

https://www.thaienquirer.com/50744/thai-government-to-tax-all-income-from-abroad-for-tax-residents-starting-2024/

 

According to legal experts, the policy appears to have three specific targets: residents trading in foreign stock markets through foreign brokerages, cryptocurrency traders, and Thais who have been exploiting a loophole that allowed them to bring foreign earnings into the country tax-free after keeping it in an offshore account for more than a calendar year.

 

No mention of of pensioners here. (My note)

 

https://www.thaienquirer.com/50748/new-tax-regulations-raises-questions-and-concerns/

 

A wealthy pensioner residing in Thailand for at least 180 days is subject to a tax rate under the new tax law. Pensions brought from their country of origin may not be subject to the law if the person can prove that they have been taxed prior to being transferred to Thailand. 

 

https://www.siam-legal.com/thailand-law/relationship-between-the-new-thai-tax-law-retirement-visa-holders-and-long-term-residency/

 

Retirees

Upon the revised law’s announcement, retirees were understandably concerned about their pensions being taxed. So, will they? It depends on the factors mentioned earlier: your country’s DTA with Thailand and whether your pension was already taxed in your home country. I want to stress this again—if your pension was taxed at home, it’s unlikely to be taxed again in Thailand. Now, what about Social Security for Americans? Here’s some good news. Social security payments to Americans are always tax-exempt in Thailand, regardless of whether you bring the income into the Kingdom. 

 

https://btisolutions.co/will-you-be-impacted-by-thailands-revised-tax-code/

 

In effect, all foreigners are now subject to tax on their income in Thailand from both domestic and external sources.

Undoubtedly, the taxpayer may and should seek tax treaty relief to prevent double taxation.

For instance, if a remittance from a fund or income source in the foreigner’s country of origin is already subject to tax, then no tax should be payable.

However, at this time, all foreigners are advised to study the particular tax treaty between Thailand and their country of origin.

Certainly, they can be very particular or significantly different in places.

 

Some Expat foreign residents face a base tax bill of up to ฿71k a year and must file a return by March 2025

 

https://www.thaiexaminer.com/thai-news-foreigners/2024/05/28/some-expat-foreign-residents-face-base-tax-bill-of-71k-baht-a-year-and-must-file-by-march-2025/

 

[CharlesHolzhauer]

2 minutes ago, bob smith said:

that the vast majority of farangs living in Thailand will never get the change to become a fully fledged immigrant

This is not and never was the issue.

[Mike Lister]

1 minute ago, Moonlover said:

 

Well, I've done quite a bit of surfing on this topic and I've come up with this little lot. Make of it what you will, but I as a pensioner whose income has already been taxed by the UK tax authorities don't feel in any way concerned about this 'new rule'.

 

 

The program will begin January 1, 2024 and apply only to tax residents in Thailand meaning tourists and short term workers will be exempt. Also exempt will be those who have been taxed in a foreign country that has a standing Double Tax Agreement with Thailand.

 

https://www.thaienquirer.com/50744/thai-government-to-tax-all-income-from-abroad-for-tax-residents-starting-2024/

 

According to legal experts, the policy appears to have three specific targets: residents trading in foreign stock markets through foreign brokerages, cryptocurrency traders, and Thais who have been exploiting a loophole that allowed them to bring foreign earnings into the country tax-free after keeping it in an offshore account for more than a calendar year.

 

No mention of of pensioners here. (My note)

 

https://www.thaienquirer.com/50748/new-tax-regulations-raises-questions-and-concerns/

 

A wealthy pensioner residing in Thailand for at least 180 days is subject to a tax rate under the new tax law. Pensions brought from their country of origin may not be subject to the law if the person can prove that they have been taxed prior to being transferred to Thailand. 

 

https://www.siam-legal.com/thailand-law/relationship-between-the-new-thai-tax-law-retirement-visa-holders-and-long-term-residency/

 

Retirees

Upon the revised law’s announcement, retirees were understandably concerned about their pensions being taxed. So, will they? It depends on the factors mentioned earlier: your country’s DTA with Thailand and whether your pension was already taxed in your home country. I want to stress this again—if your pension was taxed at home, it’s unlikely to be taxed again in Thailand. Now, what about Social Security for Americans? Here’s some good news. Social security payments to Americans are always tax-exempt in Thailand, regardless of whether you bring the income into the Kingdom. 

 

https://btisolutions.co/will-you-be-impacted-by-thailands-revised-tax-code/

 

In effect, all foreigners are now subject to tax on their income in Thailand from both domestic and external sources.

Undoubtedly, the taxpayer may and should seek tax treaty relief to prevent double taxation.

For instance, if a remittance from a fund or income source in the foreigner’s country of origin is already subject to tax, then no tax should be payable.

However, at this time, all foreigners are advised to study the particular tax treaty between Thailand and their country of origin.

Certainly, they can be very particular or significantly different in places.

 

Some Expat foreign residents face a base tax bill of up to ฿71k a year and must file a return by March 2025

 

https://www.thaiexaminer.com/thai-news-foreigners/2024/05/28/some-expat-foreign-residents-face-base-tax-bill-of-71k-baht-a-year-and-must-file-by-march-2025/

 

Far too simplistic and generalised. The examiner may state those things but I doubt the Revenue policy makers would agree they are accurate and complete. If you really want to know what the picture looks like, you have to go to the Revenue rules and the legislation, not an English language newspaper.

[atpeace]

38 minutes ago, Danderman123 said:

Only if there is a tax treaty with your home country. And the tax rates in your home country are higher than Thailand's.

 

And you don't mind mind completing a Thai return.

For someone that has repeatedly stated we don't know how the regs will be implemented, you sure seem to know many of the specifics.  Fear is much worse than the eventual reality for you and many.   Something to be said about the "no fear" cliché.  calm down and realize you are endlessly chasing your tail.

 

The new regs are simply a justifiable attempt  to tax people that aren't paying taxes.  I pay all taxes that are due and therefore "most likely" will not have to pay ANY new taxes. New regs( not new mostly) might have some unintended consequences but losing my shttt over it isn't going to make my existence any better.  For the honest, it usually works out well in the end and for those that are not, it might end poorly.

 

[4MyEgo]

39 minutes ago, CharlesHolzhauer said:

 

 

It's not that bad, e.g. if I brought in a million baht per year as income, which it's not, it's savings from the sale of a dwelling a few years back, it would work out like this.

 

Deductions for self over 65 =  190,000 baht

Wife                                             60,000 baht

1 child                                          60,000 baht

2nd child                                     60,000 baht

3rd child                                      60,000 baht

4th child                                      60,000 baht

Goods and services purchased 50,000 baht

                                                = 540,000 baht

 

So 1,000,000 -

        540,000

     = 460,000 over the tax scale 

     =   39,500 baht payable in tax, i.e. if my money was deemed income, which it isn't, it's proceeds from a sale of my principal place of residence some years ago, so zero tax would be payable IMO.

 

Almost got my knickers in a knot over nothing.

 

[ryandb]

1 hour ago, atpeace said:

OK, my running shoes cost 8k baht.  That is extortion? Should I shoplift my next pair?  Some truth in what you believe but just curious how would a society work without taxes?

What a dumb analogy you can walk away from the shop as you have a choice... A better one is you pay the mafia protection money so you don't get hurt by the mafia

 

How wouldn't it? You aren't going to go the typical "muh roads" route, are you?

 

 

[Moonlover]

3 minutes ago, Mike Lister said:

Far too simplistic and generalised. The examiner may state those things but I doubt the Revenue policy makers would agree they are accurate and complete. If you really want to know what the picture looks like, you have to go to the Revenue rules and the legislation, not an English language newspaper.

Two of those references are from financial services specialists!

[Mike Lister]

1 minute ago, Moonlover said:

Two of those references are from financial services specialists!

I saw that and I'm not having a go at you. Those pieces are puff pieces, designed to give you some information but ultimately to get you to buy their services. If you want to look at what the accountancy and tax firms have to say, PWC, Sherings, Mazars etc, are all basically doing and saying the same things but hardly any of them are actually digging into the Revenue Code. For that part you should look at some of the posts by @Dogmatix who will give you far better insight, mostly because he's not selling anything.

[John Phuket]

Wake up Guys ! sooner or later Thai Immigration will ask retirees for a copy of their Thai Tax return and/or their Bank Books  in order to grant a long stay visa. . Unfortunately, many farangs are in denial and will do nothing to negate the effect of these laws which are in effect the same as in countries like the UK and USA where you usually have to declare money that arrives in your bank account from overseas. But of course, there will be many legal loopholes and solutions. Thais, ie spouses, do not usually pay tax on gifts or on money they receive as loans but go see a really good accountant who understands Thai Tax laws before it's too late.

[atpeace]

Just now, ryandb said:

What a dumb analogy you can walk away from the shop as you have a choice... A better one is you pay the mafia protection money so you don't get hurt by the mafia

 

How wouldn't it? You aren't going to go the typical "muh roads" route, are you?

 

 

Hey, whatever floats your boat.  I myself think we should all pay taxes and you feel society would be better off with no taxes because the system is corrupt.  You may be right but still waiting for your answer.  How does this tax less society function?  I would love to live in a place where no taxes were due and magically everything paid for by taxes still existed.  

[mania]

16 minutes ago, redwood1 said:

Folks I thought this tax was for EVERYONE in Thailand including Thais.....Not a word has been said about a new income tax for Thais....

 

Actually way back when this taxing was first mentioned I pretty much thought it was all about Thai's & closing a loophole many of them use to work abroad & hold their savings there a year then sending it all home tax free. When you consider all the farm workers abroad & other lines of work it made sense.

[Kaopad999]

6 hours ago, motdaeng said:

the big open question is, will the new tax law be enforced by the tax revenue department?

 

 

I anticipate that immigration will coordinate with the tax department, so each time you submit or extend your visa, you will also be required to provide your tax information

[CharlesHolzhauer]

11 minutes ago, 4MyEgo said:

 

Almost got my knickers in a knot over nothing.

There you go - a little pertinent info can do wonders 🙂

[atpeace]

1 minute ago, John Phuket said:

Wake up Guys ! sooner or later Thai Immigration will ask retirees for a copy of their Thai Tax return and/or their Bank Books  in order to grant a long stay visa. . Unfortunately, many farangs are in denial and will do nothing to negate the effect of these laws which are in effect the same as in countries like the UK and USA where you usually have to declare money that arrives in your bank account from overseas. But of course, there will be many legal loopholes and solutions. Thais, ie spouses, do not usually pay tax on gifts or on money they receive as loans but go see a really good accountant who understands Thai Tax laws before it's too late.

or not and nothing will happen to 99% of us here that aren't tax dodgers that have always paid the taxes due on past income.  Prepare for what exactly?  Give me a scenario that doesn't apply to only 1% of expats, where we will pay taxes?  Far from likely IMO.

[foreverlomsak]

7 hours ago, webfact said:

With the first tax returns due at the end of March 2025,

As far as I understand the filing must be made within a three month window ending on 31st March.

[bob smith]

Philippines how do you do!!

 

where dem girlz at..

 

bob.

[freeworld]

44 minutes ago, ianwheldale said:

When the Thai IRS gives me a TIN I will start to take notice. Until then it's all rumour and spin.

 

The onus is upon you for your tax affairs in the law if you have assessable income

 

"Section 23 In a case where a person fails to file tax return, Amphur or an assessment official, as the case may be, shall have the power to issue summons to call such person to give evidence and issue summons to call for witness and order a non filer or witness to bring an account or evidence related to the matter but shall give at least 7 days in advance from the date of delivery of summons."

[ryandb]

9 minutes ago, atpeace said:

Hey, whatever floats your boat.  I myself think we should all pay taxes and you feel society would be better off with no taxes because the system is corrupt.  You may be right but still waiting for your answer.  How does this tax less society function?  I would love to live in a place where no taxes were due and magically everything paid for by taxes still existed.  

 

I don't just have the opinion because the system is corrupt, taking money through threat of force is immoral. At what percentage would you be ok going to for a better society? 60,70,80 90% or 100%...oh no that's slavery 

 

Pre 1913 America, roads, schools, fire houses etc. all existed. They also weren't going around bombing the world before this period too.....

 

Free market provides everything at much better value and better quality, and before you talk about the American healthcare system realize it is enabled by the government, for e.g. in some cities per state laws you can not open a hospital without the other hospitals agreeing so they can keep a monopoly on pricing, then we have IP protection laws allowing drug companies to inflate the market cost while they have IP protection which is a farce.

 

And before you ask no I do not believe in social safety nets, families and communities such as churches should take care of this.

[freeworld]

23 minutes ago, redwood1 said:

Folks I thought this tax was for EVERYONE in Thailand including Thais.....Not a word has been said about a new income tax for Thais....

How do you know Thais are not included? It is for everyone who has assessable income and over the thresholds who is resident according to tax law.

[Old Croc]

9 minutes ago, freeworld said:

No it will not. Companies and people will just be subject to tax in line with OECD, UN and CRS norms and local taxation rules.

 

Thailand as a country will still survive and they can amend their tax laws further if something is not working.

My argument is that there will be ramifications for Thailand by this taxing non-citizen pre-taxed funds remitted for expenses in this economy. 

Their recent panicky changes to visas to attract more foreigners, suggests to me that they see a revenue downturn problem with foreign money.

With myself as an example, there will be significant less money flowing in from abroad by those of us living here. In 14 years here I've imported over 25 million baht which has considerably helped extended family, and others, to further education, start businesses, receive medical care, gain lifestyle changes, obtain property, vehicles, etc.  (For the curious or confused I will not discuss this aspect further)

I have already reassessed my future imports downwards with nil remits this year and significant less to be available from now on.    I expect thousands more will also cut back in the same way. Thailand could lose a noticeable amount in the retail sector.

Even though I could meet a tax bill as just another expense, I refuse to do so to aid the Bangkok crooks to widen the massive gap between the rich and poor in Thailand. Unlike some here I am not intimidated by possible consequences of rule bending or avoidance.

 

If tax residents are ever given the same rights and privileges as locals my attitude will change.

 

[bob smith]

The question I have is given this new 'law', why would any future prospective retirees choose Thailand over Cambodia or the Phils?

 

bob.

[Chillypom]

31 minutes ago, Moonlover said:

According to legal experts, the policy appears to have three specific targets: residents trading in foreign stock markets through foreign brokerages, cryptocurrency traders, and Thais who have been exploiting a loophole that allowed them to bring foreign earnings into the country tax-free after keeping it in an offshore account for more than a calendar year.

 

No mention of of pensioners here. (My note)

 

https://www.thaienquirer.com/50748/new-tax-regulations-raises-questions-and-concerns/

Absolutely,  highly unlikely that the Revenue Department will expend 1000s of man hours fishing for the minnows when they have MUCH bigger fish to catch.

 

Tax has always been payable on income remitted in the current financial year yet how many pensioners have ever filed a Thai tax return?

[Geir Rasch]

4 hours ago, Danderman123 said:

Tax treaties help, but you need to fill out a tax form to take advantage of the tax treaties. And the tax form may or may not accommodate deductions allowed by tax treaties.

When you pay tax in Thailand you get a document saying how much you have declared for tax in Thailand. You use that document for your home country to avoid double tax.

[atpeace]

5 minutes ago, ryandb said:

 

Pre 1913 America, roads, schools etc. all existed. They also weren't going around bombing the world before this period too.....

 

Free market provides everything at much better value and better quality, and before you talk about the American healthcare system realize it is enabled by the government, for e.g. in some cities per state laws you can not open a hospital without the other hospitals agreeing so they can keep a monopoly on pricing, then we have IP protection laws allowing drug companies to inflate the market cost while they have IP protection which is a farce.

 

And before you ask no I do not believe in social safety nets, families and communities such as churches should take care of this.

Yes most those roads existed because of taxes.  History isn't your strength.  You do know there are types of taxes other than income?

 

Free market does provide a lot but not everything.  It also provides an abundance of corruption left to its own devices.  I get it - the tax system isn't perfect.  Still waiting on you to provide the alternative.

[CharlesHolzhauer]

9 minutes ago, Old Croc said:

My argument is that there will be ramifications for Thailand by this taxing non-citizen pre-taxed funds remitted for expenses in this economy. 

Their recent panicky changes to visas to attract more foreigners, suggests to me that they see a revenue downturn problem with foreign money.

With myself as an example, there will be significant less money flowing in from abroad by those of us living here. In 14 years here I've imported over 25 million baht which has considerably helped extended family, and others, to further education, start businesses, receive medical care, gain lifestyle changes, obtain property, vehicles, etc.  (For the curious or confused I will not discuss this aspect further)

I have already reassessed my future imports downwards with nil remits this year and significant less to be available from now on.    I expect thousands more will also cut back in the same way. Thailand could lose a noticeable amount in the retail sector.

Even though I could meet a tax bill as just another expense, I refuse to do so to aid the Bangkok crooks to widen the massive gap between the rich and poor in Thailand. Unlike some here I am not intimidated by possible consequences of rule bending or avoidance.

 

If tax residents are ever given the same rights and privileges as locals my attitude will change.

 

There won't be any ramifications whatsoever. You've got to get down from your imaginary high horse and face reality. Refusing to pay taxes will ultimately lead to your loss. Dare I say, your home country isn't much different - inequalities exist more or less everywhere.

[redwood1]

1 minute ago, Geir Rasch said:

When you pay tax in Thailand you get a document saying how much you have declared for tax in Thailand. You use that document for your home country to avoid double tax.

 

Wrong...

 

 

When you pay tax in your home country you get a document saying how much you have declared for tax in your home country

 

You use that document for Thailand to avoid double tax.

[sambum]

4 hours ago, WingFat said:

It occurs to me that there are only two countries that tax worldwide income; the USA and Eritrea of east Africa.

 

Americans get a foreign tax credit on their US taxes for taxes paid in a foreign country, so no change for them. I don't know about how it will work out for Eritreans.

 

For the expats that hail from countries that do not tax their citizens if they are out of the country for a specified time (usually it's 180 days or more) in a calendar year, they have been enjoying tax-free living while expatting in the LOS, in many cases, for decades.

 

While I sympathize with those who will find this a challenge to pay Thai taxes, the saying of "there's no free lunch" comes to mind. And the argument that these people contribute to the Thai economy in other ways, well, so does everyone else.

 

Whatever the case, nobody should have to be double-taxed on the same income. I surely hope that if this issue arises, it gets ironed out such there is no double taxation.

 

Re your last paragraph, I couldn't agree more. In the UK, my Govt Pension and Work Pension combined exceed the Personal Allowances limit by a small amount, so I have to pay tax on that "excess", and don't see why I should have to pay tax on it again!  

 

Another point which may have been made already as I don't go through these posts with a "fine toothcomb", is that any money that I bring into Thailand is spent in Thailand on foods and services which have already had tax added via VAT, and Import Taxes in the case of "farang foods and drinks", so if I am reading things correctly, my money will be taxed by the Inland Revenue in the UK, taxed by the Thai Government twice (via Income Tax and VAT) so theoretically, I will be taxed 3 times on my meagre pension which has been "frozen" (No annual increments) for the last 10 years as I am not resident in the UK. Fair?