Thailand to tax residents’ foreign income irrespective of remittance

[jayboy]

9 hours ago, Sheryl said:

The simplest solution, and one consistent with what other countries who tax worldwide income do, would be to limit taxation on foreign income to Thai citizens and permanent residents

 

 

Well thanks for that.I am sure all holders of Permanent Residence would be honored to be singled out from other resident foreigners for this discriminatory treatment.

 

Quite why PRs in retirement, often living in modest financial circumstances, should pay tax on overseas income while much wealthier expat retirees are exempted, is not immediately clear to me. I don't think the US Green Card precedent is relevant because the situations are totally different,

Edited June 10 by jayboy

[Tony M]

Here is another stupid question, and I apologise if it has been asked and answered here or elsewhere.

 

If I win 1 million GBP on the Premium Bonds, would Thailand want to tax that full amount as "global income" ? Premium Bonds prizes are, of course, tax - free, along with any income from those bonds (I believe ?).  ?

Uk premium bonds tax fee

Interest is tax-free: Premium Bonds are a government-backed investment product, and the interest earned is free from both income tax and capital gains tax.

No penalties or exit fees: You can cash in your bonds at any time without incurring any penalties or exit fees.

Tax-free prizes: The monthly prize draw is also tax-free, and you don’t have to include the winnings in your tax return.

No guaranteed regular income: Unlike traditional savings accounts, Premium Bonds do not guarantee a regular income or returns. The interest earned is based on luck and the annual prize fund rate.

Secure investment: As a government-backed investment product, Premium Bonds are secure and backed by HM Treasury, ensuring that 100% of your investment is protected.

No tax implications: There are no tax implications for non-UK residents who hold Premium Bonds, as the interest earned is not subject to UK tax. However, tax may be applicable in the country of residence.

[schweizer]

7 minutes ago, Tony M said:

Here is another stupid question, and I apologise if it has been asked and answered here or elsewhere.

 

If I win 1 million GBP on the Premium Bonds, would Thailand want to tax that full amount as "global income" ? Premium Bonds prizes are, of course, tax - free, along with any income from those bonds (I believe ?).  ?

Uk premium bonds tax fee

Interest is tax-free: Premium Bonds are a government-backed investment product, and the interest earned is free from both income tax and capital gains tax.

No penalties or exit fees: You can cash in your bonds at any time without incurring any penalties or exit fees.

Tax-free prizes: The monthly prize draw is also tax-free, and you don’t have to include the winnings in your tax return.

No guaranteed regular income: Unlike traditional savings accounts, Premium Bonds do not guarantee a regular income or returns. The interest earned is based on luck and the annual prize fund rate.

Secure investment: As a government-backed investment product, Premium Bonds are secure and backed by HM Treasury, ensuring that 100% of your investment is protected.

No tax implications: There are no tax implications for non-UK residents who hold Premium Bonds, as the interest earned is not subject to UK tax. However, tax may be applicable in the country of residence.

I am not aware of this being specifically mentioned by the tax office but yes it would probably be applicable to taxable income, I am Swiss, if I am living in GB and win the British lottery I would have to pay Swiss tax if I am still tax resident in Switzerland,

So it would depend on your residency not the funds source, even worse if you are an American living in CH and won the Swiss lottery, first they would pay Swiss tax as we tax lottery winnings, then US tax, my GF who is American and Swiss resident pays both Swiss and US taxes

 

[MarkBR]

Wonder if this Kulaya Tantitemit has shown computer model projections of how much revenue Thailand potentially will lose to her bosses?

[Felt 35]

46 minutes ago, Sheryl said:

There isn't a special tax rate on interest. Assuming it is assessable in Thailand under the terms of the relevant DTA, it is same as any other income. Tax rate depends on total assessable income (from all sources) minus deductions/exemptions. this has been covered in detail in other threads. See https://aseannow.com/topic/1324294-introduction-to-personal-income-tax-in-thailand/

 

Savings in the bank from prior earnings are not income so not taxable anywhere.

 

Correct that at this time, only funds remitted to Thailand (and Thai-sourced income, if any) are taxable. Again, subject to the terms of applicable DTA.

 

Thank you for replying. So, we are supposed to only add interest gained yearly on the top of pension income🤔But income (in my case pension) has to be proved with a 12 month bank statement here who show the transfers month by month, but I never touch saving or the interest on bank account abroad so will be exciting to see if they go to the length and demanding bank statement from bank(s) abroad which then most likely have to be translated and verified by Mfa....

Felt

[redwood1]

39 minutes ago, Jinxed1 said:

very helpful

 

To be more specific in case some did not understand, my question is what would happen IF this proposal were to pass 🙂

 

Also, as I said, it sounds like the Thaiger does have an information on the specific date the rule is gonna apply, so it sounds a bit more than "just a proposal"

 

 

 

Have a date its going to apply?

 

Yea kind of like the  300 baht tourist tax....There must have been at least 5 or 6 soon to be almost start dates on that tax......And now its 100% dead.....

 

Or VAT on all international deliveries valued over 1 baht....I think were already up to 3 start dates on that one...

 

The original start date January 1  2024 is already dead for a tax on income...Now its number 2 and counting..

 

Point being many things in Thailand with to many start dates just never happen...

[Sheryl]

1 hour ago, Jinxed1 said:

very helpful

 

To be more specific in case some did not understand, my question is what would happen IF this proposal were to pass 🙂

 

Also, as I said, it sounds like the Thaiger does have an information on the specific date the rule is gonna apply, so it sounds a bit more than "just a proposal"

 

 

This "rule" is so  far a proposal and would need a change to the tax law to go into effect.

 

The soonest that could possibly  happen would  be before the end of this  year in which case it would be effective 2025 income, reflected  on returns filed 2026.  Could well take longer ro pass  -if it does at all. 

 

Not to be confused with the revised regulation on remittances, which is in effect since first of this year (2024) and would be reflected in tax filings in 2025. 

 

 

[Lorry]

2 hours ago, Sheryl said:

In Europe and (so far) SEA, income earned abroad and not remitted to country of residence is usually not taxed in the latter.

That's wrong,  it IS usually taxed. 

 

For SEA, this has often been discussed in the main tax thread.  The consensus was that only the Philippines don't tax foreign income that has not been remitted to country of residence. (I think,  HK and Singapore too, not sure - but these are financial centers with very special laws and anyway no alternative for someone who is looking for an alternative to Thailand).

Taiwan has a very high limit (200,000 USD).

Vietnam taxes worldwide income.  

Malaysia in principle,  too.

Cambodia, according to the letter of the law, too.

 

In Europe,  it would be difficult to find a country that doesn't tax worldwide income. Germany and France do it, the UK has the non-dom rules but normal residents pay tax for worldwide income. 

The country most mentioned on AN is Portugal,  

 

Residents in Portugal for tax purposes are taxed on their worldwide income at progressive rates varying from 13.25% to 48% for 2024.

 

https://taxsummaries.pwc.com/portugal/individual/taxes-on-personal-income

[Jinxed1]

1 hour ago, Sheryl said:

This "rule" is so  far a proposal and would need a change to the tax law to go into effect.

 

The soonest that could possibly  happen would  be before the end of this  year in which case it would be effective 2025 income, reflected  on returns filed 2026.  Could well take longer ro pass  -if it does at all. 

 

Not to be confused with the revised regulation on remittances, which is in effect since first of this year (2024) and would be reflected in tax filings in 2025. 

 

 

Thank you, that was also my thinking until i saw that video from the Thaiger (timecoded)
They say the new law (worldwide income tax of all income sources) would be effective from 2024. So you think they're just misinterpretating? 

 

[Lorry]

The articles reporting the ideas of the General Director of the RD sounded indeed as if she would like to introduce taxation on worldwide income in 2024.

That would be retroactively, but nothing hinders a sovereign state to introduce laws retroactively. My home-country does this regularly.

 

But as of now, these are just wishes of a senior tax official. Forget about 2024, and most probably 2025.

It will probably happen imho,  but not so fast.

Edited June 10 by Lorry

[CallumWK]

52 minutes ago, Lorry said:

It will probably happen imho,  but not so fast.

 

It will never happen, simply because they have no legal rights for it. I know the example of the US has been brought up, but that is something completely different, as it only applies to US citizens or residence holders.

 

We are not citizens in Thailand. Your home country actually could make it legal to tax you on the money you earn in Thailand regardless if you transfer it or not, but not vice versa

[El Matador]

I was actually expecting this kind of taxation as the remittance system is an absolute bureaucratic nightmare to deal with for the tax administration. Now the possibilities to optimize your taxation will be completely closed. It will follow the common worldwide taxation adopted by most countries.

The remittance system gave a great incentive to never remit the money earned outside of Thailand.

 

Sorry for the people who bought the Thai Elite visa last visa based on the previous tax system.

 

I can't wait for the new visas to stay under the 180 days limit to limit the bureaucracy.

Edited June 10 by El Matador

[Thailand J]

20 hours ago, Misty said:

 

 

Yes, in fact that's what I said in my previous post as well, so I'm glad we agree.  If it's short term gains (or unqualified dividends), the US tax would be 3x higher than your initial example of US tax owed, which assumed only long-term gains/ qualified dividends.

 

As previously, my initial example wasn't about the US (never mentioned the US), it was for someone who said they owed 25% tax on rental income in Canada and they didn't want to pay 35% in Thailand.

 

Many folks on here are posting as if any/all income will be taxed at 35%. The example I posted showed that the effective Thai tax rate would be 20.7%. Not great, but it's not a flat 35%.

 

Hope that helps!

 

 

I got you. I hope you see my point that Thai tax could be alot more than what we are paying back home, could be many times more.

 

Are you sure he's paying 25% effective rate back home? may be he was talking about his tax bracket. Also the 35% Thai tax he mentioned is more likely tax bracket, not effective tax rate.

 

Edited June 10 by Thailand J

[MeePeeMai]

57 minutes ago, Thailand J said:

I got you. I hope you see my point that Thai tax could be alot more than what we are paying back home, could be many times more.

 

 

Yes, exactly.  Imagine if someone sells their home in their home country (in the same year that they are a "tax resident" of Thailand) and makes a large profit on that sale.

 

For me it would be tax free up to $250,000 USD in the USA.  The taxes that would be due here for me would be 35% (since my other income sources would already push me up into that Thai tax bracket).

 

$250,000 USD x 35% = $87,500 USD or 3,213,875 Thai Baht in Thai tax due (at the current exchange rate). 

 

To compound upon that, I have owned my home for more than 23 years and the equity in that home is much more than 250k.

 

So yes, you are correct... Much more tax than what I would pay in the USA.  

 

 

Edited June 10 by MeePeeMai

[TroubleandGrumpy]

I think that there is a misunderstanding of what the TRD GM is proposing - I think.  I know I suffered the same confusion between Nationality taxation and Residence taxation - they can both be worldwide taxation systems, but they are very different taxation systems. 

 

Under the TRD proposed 'worldwide/global system' system, it would still be a Residence based system, and the income of a Thai 'tax resident' earned worldwide would have to be declared on their annual Thai tax return. The current That tax system only taxes 'overseas income' of a tax resident when it is remitted into Thailand.  The recent rule change closed the loophole that meant income earned overseas and remitted into Thailand was taxable only in the year it was earned.  

 

Yes it would require a change to the Tax Laws if Thailand went the full USA Nationality path, and taxed all its Citizens and Residents on their worldwide income, whether they are a tax resident of another country or not. But I do not think that was what the TRD statement was about and IMO they will remain a Residence based tax system. There are only 5 countries currently doing that Nationality based system - USA being the main one/leader.

 

With regards to the need to amend the Tax Act/Laws to enable global taxation under the current residence based system, I am not so sure that this would be complicated, because it would mean removing the rule that states the worldwide income is not taxed unless it is remitted into Thailand.  Most residence system based countries tax all worldwide incomes for their tax residents - Thailand is one of only a few that only taxes worldwide income when it is remitted into Thailand. 

 

If Thailand introduces a worldwide tax system and removes the 'remitted only' rule, then all Thailand tax residents will have to declare all income overseas.  Then under applicable DTAs they can claim tax offsets for any taxes already paid.  OR Thailand could decide that they have to pay full taxes in Thailand, and using the DTA they can claim back all taxes paid overseas and get the overseas country to not apply taxes.  Thailand may try and do that, but that would be in breach of the DTAs based on my reading of them, whereby under the DTA it is the person who decides in which country they will pay taxes on overseas income earned - however, I think that might only applies if they are still a tax resident of that other country. Complications that I am sure TRD will clarify - NOT.

 

If under the current 'remitted only' system, or the possible global taxation system, the TRD allows the DTAs to be utilised to reduce the taxation that Thailand can apply to remitted/global income, how does a PIT do that?  The current online and hard copy tax return for PIT does not have any section that allows for the input of taxes already paid overseas or any other claims based on a DTA.  Obviously that also means that there is currently no details for what records are required to base make a DTA claim upon - perhaps they will utilise the current business taxation processes whereby those things are standard.  But the Thai tax year is Jan to Dec and many Expat home countries (Aust, Canada, USA, Japan etc.) do not have Jan-Dec tax years - some some countries do (China, Germany, France etc.). So how does someone from a country with a tax year different to Jan-Dec detail/prove their claim of taxes already paid?   More complications that I am sure TRD will clarify - NOT.

[Thaindrew]

On 6/8/2024 at 12:42 AM, Lorry said:

@Dogmatixis right,  credit card and ATM transactions have nothing to do with CRS

I suppose you could say they do and they don't, reading the CRS guide on the OECD website what actually gets recorded is "payments to your accounts" and "starting / ending balances". Since CRS support Global Tax Systems rather than Remittance Based Tax Systems.

 

So for 2024 spending on credit cards, using debit cards may go below the radar (I heard from advisors both that they are included / not included). Whilst Thailand is taxing remittances, they can only try to tax what hits you Thai Bank Account (they can see also what hits any foreign account, but thats currently not relevant). But in 2025 if they move to taxing global income, for tax residents, then CRS will give them details of all payments made into your account(s) everywhere which they can consider as assessable for income tax unless you can prove prove them wrong.

[jayboy]

58 minutes ago, Thaindrew said:

But in 2025 if they move to taxing global income, for tax residents, then CRS will give them details of all payments made into your account(s) everywhere which they can consider as assessable for income tax unless you can prove prove them wrong.

 

Surely it is extremely unlikely that if global income was taxed the RD would be checking such overseas payments through CRS UNLESS something untoward caught their attention in the tax return.In the instance of expatriate retirees tax returns I would suggest that risk would effectively be Nil.

[Tom100]

On 6/5/2024 at 7:40 PM, Foxx said:

 

That is incorrect.  The USA and Eritrea tax worldwide income based upon nationality - not upon residence.  Plenty of other countries tax the worldwide income for their resident nationals, including the UK.

Foxx is correct. Other countries that tax their "tax residents" on international income include Canada, Spain, Italy, France and Portugal. Probably many more in EU. 

 

 

[black tabby12345]

I strongly believe that English-speaking accounting  firms are behind this stupid move(new tax things targeting foreigners)

In order to capitalize the anxiety among the 1st world expats.

After my out-of-curiosity queries sent to 2-3 of such establishments, they were very keen to tell me that they can arrange advisory meeting for THB5000-17000/hour.

 

Even when tax department cannot collect any money from those whose income is already taxed elsewhere, these firms can still at least make a good amount of money  by making up a useless

self-interested meeting with the worrying aliens  in the name of Expert Advice.

It might be just one-off occasion per individual.

 

Earlier  in the 21st century, Thai govt. started to allow foreigners to buy some of their over-produced condominiums. Due to the pressure from the housing developers(that were suffering the aftermath of late 1990s Asian Currency Crisis).

 

To me, the same thing is happening again in the different field.

What other people think about?

Edited June 11 by black tabby12345

[black tabby12345]

On 6/6/2024 at 1:38 PM, Neeranam said:

Exactly what I was thinking. Nice to see you again btw 🙂 

 

M.I.B(Men In Black)Thailand.

The new breed of govt agency specialized in probing aliens' out space assets & income LOL.

[TroubleandGrumpy]

4 hours ago, jayboy said:

 

Surely it is extremely unlikely that if global income was taxed the RD would be checking such overseas payments through CRS UNLESS something untoward caught their attention in the tax return. In the instance of expatriate retirees tax returns I would suggest that risk would effectively be Nil.

Mate that may be true - but you and many others are missing the point.  Unlike normal 'offences' where a person is caught in the single act or afterwards, when the Tax Dept investigates a person for whatever reason, they can and will go back through their financial records to 2024/2025. That means if they are only here for a few years, then your attitude is probably 'safe'. But if they are going to be here for decades, then they cannot just brush it off as 'unlikely' to be caught - because the backdated taxes, penalties and fines and interest payments could be horrendous - and could even include criminal charges and deportation (they would only be allowed to leave after paying everything).  Lets say a Pensioner under global taxation has to pay only 50K PA taxes but does not - after 5 years they would owe about 250K, plus 50K interest, plus 10K fines, plus 25K penalties (estimated - maybe more) and that totals 335K - and they have 2 weeks to pay. Mate - it could be serious and just ignoring it like not wearing a helmet is IMO not wise for those living here long term.  I do not want anyone to worry - because we will all know the situation by 2025 (hopefully). Expats would be wise to keep across the issue now and then, and not ignore it because it might go away, or they wont ever get caught.  I hope it does go away, but I think it might not - and I am very confident they will screw it all up. 

Edited June 11 by TroubleandGrumpy

[jayboy]

I don't disagree that one needs to keep across the issue to use your expression.

 

But without disputing your account of hypothetical penalties for non payment, one also needs to exercise good judgement and common sense.Bear in mind we are talking (at least I am) about mostly late middle aged pensioners.Subject to any unforeseen developments, I believe they have accepted albeit reluctantly they will need to pay Thai tax, initially on assessible inward remittances and maybe thereafter on all global income.My point was that the Thai RD will process these returns automatically if all looks untoward especially as the in most cases the amounts involved will be modest. It is highly unlikely that such returns will be subject to audit, and even in the unlikely event of this happening the RD will not be concerned by - for example - use of off shore credit cards.In fact they wont know about it.

[bg53]

6 hours ago, TroubleandGrumpy said:

under the DTA it is the person who decides in which country they will pay taxes on overseas income earned

 

DTAs do not work this way. Both Contracting States (at residence/domicile and at source) will have a right to tax (save for exemptions, limitations, non-discrimination or other clauses). The resident has no right to select which country he pays tax to. At best he can claim tax credit under the particular DTA to prevent Double Taxation by both Contracting States.

[BobBKK]

Pensions are normally taxed at source - surely they don't mean to double tax pensioners?

[TheAppletons]

1 hour ago, TroubleandGrumpy said:

Mate that may be true - but you and many others are missing the point.  Unlike normal 'offences' where a person is caught in the single act or afterwards, when the Tax Dept investigates a person for whatever reason, they can and will go back through their financial records to 2024/2025. That means if they are only here for a few years, then your attitude is probably 'safe'. But if they are going to be here for decades, then they cannot just brush it off as 'unlikely' to be caught - because the backdated taxes, penalties and fines and interest payments could be horrendous - and could even include criminal charges and deportation (they would only be allowed to leave after paying everything).  Lets say a Pensioner under global taxation has to pay only 50K PA taxes but does not - after 5 years they would owe about 250K, plus 50K interest, plus 10K fines, plus 25K penalties (estimated - maybe more) and that totals 335K - and they have 2 weeks to pay. Mate - it could be serious and just ignoring it like not wearing a helmet is IMO not wise for those living here long term.  I do not want anyone to worry - because we will all know the situation by 2025 (hopefully). Expats would be wise to keep across the issue now and then, and not ignore it because it might go away, or they wont ever get caught.  I hope it does go away, but I think it might not - and I am very confident they will screw it all up. 

 

  Let's keep the story time rolling.....

 

  And when they can't pay all of these hypothetical back taxes, interest, fines, and penalties (what, pray tell, is the difference between a fine and a penalty?), they "probably" will go to Thai prison.

 

  While in hypothetical Thai prison, they will "probably" be forced to have unprotected sex with other men.

 

  So they'll "probably" catch HIV and then "probably" develop AIDS.

 

  Go sign up for a Thai TIN immediately or you'll "probably" die of AIDS.

 

  (Wow!  Thanks for the heads up.  Probably.)

[Thailand J]

50 minutes ago, BobBKK said:

Pensions are normally taxed at source - surely they don't mean to double tax pensioners?

Depends on the DTA between your country and Thailand.

US SS benefits and government pensions are not taxable here according to US-Thai DTA.

 

Unfortunately US private pensions are taxable here, such as IRA's and Roth IRA's.

Exemption from tax, Thai Revenue Code  Section 41(12):

"Special pension, special gratuity, inherited pension or inherited gratuity."

I wish I can get someone in the RD to clarify what is special pension.

[BobBKK]

29 minutes ago, Thailand J said:

Depends on the DTA between your country and Thailand.

US SS benefits and government pensions are not taxable here according to US-Thai DTA.

 

Unfortunately US private pensions are taxable here, such as IRA's and Roth IRA's.

Exemption from tax, Thai Revenue Code  Section 41(12):

"Special pension, special gratuity, inherited pension or inherited gratuity."

I wish I can get someone in the RD to clarify what is special pension.

 Nothing for us... I'm a Brit, but I'm taxed and have documents to show that.

[Dogmatix]

20 hours ago, Tony M said:

Here is another stupid question, and I apologise if it has been asked and answered here or elsewhere.

 

If I win 1 million GBP on the Premium Bonds, would Thailand want to tax that full amount as "global income" ? Premium Bonds prizes are, of course, tax - free, along with any income from those bonds (I believe ?).  ?

Uk premium bonds tax fee

Interest is tax-free: Premium Bonds are a government-backed investment product, and the interest earned is free from both income tax and capital gains tax.

No penalties or exit fees: You can cash in your bonds at any time without incurring any penalties or exit fees.

Tax-free prizes: The monthly prize draw is also tax-free, and you don’t have to include the winnings in your tax return.

No guaranteed regular income: Unlike traditional savings accounts, Premium Bonds do not guarantee a regular income or returns. The interest earned is based on luck and the annual prize fund rate.

Secure investment: As a government-backed investment product, Premium Bonds are secure and backed by HM Treasury, ensuring that 100% of your investment is protected.

No tax implications: There are no tax implications for non-UK residents who hold Premium Bonds, as the interest earned is not subject to UK tax. However, tax may be applicable in the country of residence.

My guess is that you would get to donate GBP 350,000 of your 1 million prize to the Thai government. This is essentially income from a foreign government bond which is taxable. Whatever tax exemptions may apply to similar schemes in Thailand like the Government Savings Bank lottery (and I am not if that is exempt anyway but prizes on the National Lottery are taxed at only 0.5%) would not apply to a foreign scheme because it is not named in any regulation. It would just be classified as interest or income from other investments and taxed at 35%.

 

it is worth noting that you can opt to be taxed at a flat rate of 15% on interest from Thai banks but this doesn’t apply to interest from foreign banks. There are several concessions on Thai dividends, interest, capital gains and property sales that won’t apply to the same foreign investments. So it will massively unfair to expats living off foreign investment income. I expect many will vote with their feet.

Edited June 11 by Dogmatix

[Tony M]

Thank you for your response.  If this "scheme" is introduced, there is no way that I would potentially give the Thai government 35% of income from any of my investments. Especially if someone who stays less than 180 days  a year in Thailand wouldn't need to pay the same as they wouldn't be tax resident. (I do realise that wherever a person lives might result in taxes). The Thai government is unlikely to give anything in return for receiving a potential 35% of my income, or interest, in taxes from me, so they can lose all tax income from me.  Currently tax resident here, I will happily become non-tax resident here.

[Dogmatix]

9 hours ago, TroubleandGrumpy said:

I think that there is a misunderstanding of what the TRD GM is proposing - I think.  I know I suffered the same confusion between Nationality taxation and Residence taxation - they can both be worldwide taxation systems, but they are very different taxation systems. 

 

Under the TRD proposed 'worldwide/global system' system, it would still be a Residence based system, and the income of a Thai 'tax resident' earned worldwide would have to be declared on their annual Thai tax return. The current That tax system only taxes 'overseas income' of a tax resident when it is remitted into Thailand.  The recent rule change closed the loophole that meant income earned overseas and remitted into Thailand was taxable only in the year it was earned.  

 

Yes it would require a change to the Tax Laws if Thailand went the full USA Nationality path, and taxed all its Citizens and Residents on their worldwide income, whether they are a tax resident of another country or not. But I do not think that was what the TRD statement was about and IMO they will remain a Residence based tax system. There are only 5 countries currently doing that Nationality based system - USA being the main one/leader.

 

With regards to the need to amend the Tax Act/Laws to enable global taxation under the current residence based system, I am not so sure that this would be complicated, because it would mean removing the rule that states the worldwide income is not taxed unless it is remitted into Thailand.  Most residence system based countries tax all worldwide incomes for their tax residents - Thailand is one of only a few that only taxes worldwide income when it is remitted into Thailand. 

 

If Thailand introduces a worldwide tax system and removes the 'remitted only' rule, then all Thailand tax residents will have to declare all income overseas.  Then under applicable DTAs they can claim tax offsets for any taxes already paid.  OR Thailand could decide that they have to pay full taxes in Thailand, and using the DTA they can claim back all taxes paid overseas and get the overseas country to not apply taxes.  Thailand may try and do that, but that would be in breach of the DTAs based on my reading of them, whereby under the DTA it is the person who decides in which country they will pay taxes on overseas income earned - however, I think that might only applies if they are still a tax resident of that other country. Complications that I am sure TRD will clarify - NOT.

 

If under the current 'remitted only' system, or the possible global taxation system, the TRD allows the DTAs to be utilised to reduce the taxation that Thailand can apply to remitted/global income, how does a PIT do that?  The current online and hard copy tax return for PIT does not have any section that allows for the input of taxes already paid overseas or any other claims based on a DTA.  Obviously that also means that there is currently no details for what records are required to base make a DTA claim upon - perhaps they will utilise the current business taxation processes whereby those things are standard.  But the Thai tax year is Jan to Dec and many Expat home countries (Aust, Canada, USA, Japan etc.) do not have Jan-Dec tax years - some some countries do (China, Germany, France etc.). So how does someone from a country with a tax year different to Jan-Dec detail/prove their claim of taxes already paid?   More complications that I am sure TRD will clarify - NOT.

I agree there seemed no intention to tax globally on the US model. That would impact Thai citizens living overseas and would be very unpopular while collecting very little incremental tax vs the European style global tax for tax residents only