Thailand to tax residents’ foreign income irrespective of remittance

[Sheryl]

12 minutes ago, Presnock said:

TODAY THAI EXAMINER

Hardly an authoritative source and the article seems to conflate whether tax is owed/income is taxable with whether required to file. It also sites a section of the Revenue Code (41) which as far as I can determine, does not deal specifically with who is required to file a return.

 

AFAIK it remains the case that people with no assessable income are not required to file.  Also remains the case that there is no penalty for failure to file if you owe no Thai tax.

 

I really do not think the Thai RD wants to start receiving  a lot of null returns.

 

Now what is true is that, IF this change to the law is enacted and IF it applies to foreign nationals, many more of them will have assessable income/owe Thai taxes than was previously the case.

 

But that is not at all the same as requiring all foreigners to file a tax return.

[lordgrinz]

13 minutes ago, Dogmatix said:

 

No. Unfortunately the Thaiger and Bkk Post both combined bits from two different press releases using the same phaseology about a billion baht platform.  The billion baht platform came from an unrelated press release from the finance ministry confirming that, following a cabinet resolution on 27 May the government will initiate legislation to impose a top up tax on subsidiaries of multinationals in Thailand that use transfer pricing to reduce their Thai tax rates. This is following the EU which imposes this tax on MNCs with total revenues of 750 million euros plus. A billion baht is a lot less than this but it was not clear, if the RD meant global turnover or turnover in Thailand. 

 

Thaiexaminer put out a far more coherent article here but they don't attribute quotes and it is not clear, if the commentary if from their own reporter or indirectly quoting Revenue Department officials.  What is important here is that Thaiexaminer claimed they want to impose global tax from 2025 which would be a tall order, given that it has not yet been approved by the cabinet and would have to be vetted by the Council of State and go through 3 readings in par

https://www.thaiexaminer.com/thai-news-foreigners/2024/06/05/thai-taxman-now-plans-to-tax-foreigners-on-all-income-whether-it-m-or-not/

 

Party is over, say goodbye to capital inflows, dead on arrival!

[Gilligan In Drag]

If you earn less than $70,000/year as a US citizen residing abroad you don't owe any taxes. Another reason all of this looks not very well thought through, how many actually owe what the Thai government thinks they are going to get. When they announced all of this initially somebody or the article linked to a translation of the proposed law, if you are making a mere 20,000 per year you are already in the revenue department's 30 percent taxation bracket as I recall and as I also think I recall, many would be asked to pay over half of their income and if the Revenue department  sticks with that and tax you regardless of whether you brought the money in, that is just flat out robbery and i don't know who would stay here, very few. So it really looks like Thailand is trying to flush out the permanent foreign residents, turn us into tourists and/or its the globalists whom they seem to be in line with talking about universal taxation throughout the world, they don't want people living abroad unless they are the migrants who will serve in the police force and military of the US and Europe and do all the work people don't want to do anymore because it doesn't pay a living wage.

[bradiston]

1 hour ago, Neeranam said:

Thailand approved its first spot in Bitcoin ETF, with One Asset Management joining the growing list of jurisdictions approving regulated Bitcoin funds.

https://bitcoinmagazine.com/business/thailand-approves-the-first-spot-bitcoin-etf

Well, I'd agree the links between hackers and crypto are pretty well established, but buying coin can't really be called investing in hacking. Wait. Yes, I suppose it can! Ok, point taken.

[Sheryl]

5 minutes ago, Dogmatix said:

 

Can do online but it is only in Thai and they give a week's grace after the 31 March deadline, then shut down the online filing and force you to do a hard copy filing. There is no clear logic to this, if folk are willing to pay the 200 baht fine to file online late.  I was caught by this, thinking I could file online late.  The result was I put myself to hours and hours of unnecessary work to claim tax credits from my Thai dividends that was worth a few hundred baht refund and had to compute the tax myself.  Filing online you can opt to have the TSD stock registry feed all your dividend details direct to the RD.  Click on an icon and in less than a minute all the dividends are shown with the tax credits neatly calculated. 

Hopefully they will have English language version by 2025. (or 2026 if new law comes into effect as of 2025).

 

I just did a back of the envelope calculation based on my 2023 income and what I would owe in Thai tax and in taxes to the US would be more or less the same. So a total wash, just a lot more paperwork and claiming of tax credits.

 

But that's me, and I have always been having to pay tax to the US.  People who have been managing to avoid tax anywhere, and US citizens with foreign income exempted from US tax, may start to owe more in taxes than before/owe taxes for the first time.

 

 

[Neeranam]

18 minutes ago, Dogmatix said:

 

No. Unfortunately the Thaiger and Bkk Post both combined bits from two different press releases using the same phaseology about a billion baht platform.  The billion baht platform came from an unrelated press release from the finance ministry confirming that, following a cabinet resolution on 27 May the government will initiate legislation to impose a top up tax on subsidiaries of multinationals in Thailand that use transfer pricing to reduce their Thai tax rates. This is following the EU which imposes this tax on MNCs with total revenues of 750 million euros plus. A billion baht is a lot less than this but it was not clear, if the RD meant global turnover or turnover in Thailand. 

 

Thaiexaminer put out a far more coherent article here but they don't attribute quotes and it is not clear, if the commentary if from their own reporter or indirectly quoting Revenue Department officials.  What is important here is that Thaiexaminer claimed they want to impose global tax from 2025 which would be a tall order, given that it has not yet been approved by the cabinet and would have to be vetted by the Council of State and go through 3 readings in parliament, unless they choose the short cut route of a Royal Decree which is risky as parliament can theoretically overturn that later, since it has the right to review Royal Decrees retroactively, given the decrees bypass parliament. Since I can't find the original press release or comment from the Revenue Dept or finance ministry, I can't say how accurate this article is, particularly in the planned timeline.

 

https://www.thaiexaminer.com/thai-news-foreigners/2024/06/05/thai-taxman-now-plans-to-tax-foreigners-on-all-income-whether-it-is-remitted-to-the-kingdom-or-not/

Very interesting, thanks a lot! 

[MeePeeMai]

11 minutes ago, Dogmatix said:

https://www.thaiexaminer.com/thai-news-foreigners/2024/06/05/thai-taxman-now-plans-to-tax-foreigners-on-all-income-whether-it-is-remitted-to-the-kingdom-or-not/

 

That's the goodbye kiss for me if it comes true.  Burying your head in the sand and pretending like it's never going to happen is foolish in my book.

 

I got a ticket out of here on June 16th and I was planning to come back in a few weeks but after reading that article, I think I'll go elsewhere for at least the remainder of the year to let the smoke clear.

 

Luckily, I don't have any wife or kids here, just a pickup truck and my two motorbikes.  I always hope for the best but plan for the worst in case something like this happens.  Sad.

 

Buddha help us!

[NoDisplayName]

2 hours ago, retarius said:

You sound very angry. People often make bad decisions when they are angry. By all means buy a condo in Cambodia, it isn't going to hurt Thailand any, because you don't contribute anyway, and leave the homestead in Isaan to rot. And trying to sell a house in Isaan is no picnic....if you built a house on land you bought, it's likely worth less than what you spent on it. It is a common mistake people make here thinking that house prices appreciate all the time like back home. 15000 baht isn't a huge amount of money to someone a canny as you are, after all you pay no tax in the US, only make huge unrealised gains in the stock market....are you Donald Trump?

 

You no unnerstan.

Me no angry.

Me no make unrealized gains.

Me sell'um stock after me hodl one year, me make money.

Me make'um reallyized gains.

Me retireded, me no work, no get saraly.

Me get 0% capital gain taxes rate.

Why me want pay Thai tax on $75,000?

 

 

[Sheryl]

3 minutes ago, Gilligan In Drag said:

If you earn less than $70,000/year as a US citizen residing abroad you don't owe any taxes.

Not accurate.

 

There is a Foreign Income Exclusion but not everyone qualifies for it; for those that do, up to 120,000 can be exempted, not 70,000.

 

This applies only to income earned abroad and there are requirements to qualify; also overseas employment for the US government is nto eligible.

 

Interest income, pension income, SS income, other types of passive income, all remain taxable in the US, makes no difference if living abroad.

 

And in calculating how much of SS is taxable the excluded foreign income is added back into the formula; in other words, you pay tax on a greater portion of your SS if you had income from abroad excluded.

 

You also still owe Self Employment tax on full amount of income earned abroad if it was from self-employment.

 

I have lived abroad for decades, and always owed US tax.

[John Drake]

5 minutes ago, NoDisplayName said:

 

You no unnerstan.

Me no angry.

Me no make unrealized gains.

Me sell'um stock after me hodl one year, me make money.

Me make'um reallyized gains.

Me retireded, me no work, no get saraly.

Me get 0% capital gain taxes rate.

Why me want pay Thai tax on $75,000?

 

 

 

Got ya, chief.  I can understand your unwillingness to deal with it. 

[topt]

6 minutes ago, Gilligan In Drag said:

and as I also think I recall, many would be asked to pay over half of their income

I suggest you recall incorrectly - or the post you remember was complete hogwash..........

 

As to the rest of your post.........I will pass

. 

[sqwakvfr]

1 hour ago, Letseng said:

But not everybody comes from US. What if you are required to submit US income tax return when doing your Thai self assessment?

Hypothetical, not real and a little bit of sarcasm. 

[JimGant]

3 hours ago, MangoKorat said:

my take on it is that all that will change is that you won't be able to claim that the money you bring into Thailand was earned before 1 January 2024.

You miss the whole point on the new policy, which won't care about any money brought in -- only income earned in the current tax year, that per DTA, is taxable by Thailand. Nevertheless, all that money in your pre 2024 bank account is now savings, not current year income. Feel free to remit it, or not, as there's no longer a tax angle to it.

[Ben Zioner]

21 minutes ago, Gilligan In Drag said:

many would be asked to pay over half of their income a

How is that possible when the top bracket is taxed at 35%? Just asking..

[NoDisplayName]

3 hours ago, Thaindrew said:

capital gains are now taxed in Thailand as income, make a profit on a property sale and it taxed at income tax rates. the land office is sending sales paperwork to the tax office, who contact you to pay the tax 

 

I was not clear enough.

This was about capital gains on sale of stock.

No cap gains tax due on Thai stocks.

Cap gains tax at regular income rate on foreign stock.

[Gilligan In Drag]

I'm not paying one satang, even if that means becoming a non-resident, I cannot live on what they leave for me, 14,000 dollars a year for a family of 3 and others in family who are "living" on 500 baht a month disability. Speaks to how interested they are in people's welfare doesn't it, getting more money out of foreign resdients is hardly going to change that.

[CharlesHolzhauer]

30 minutes ago, Dogmatix said:

a Royal Decree which is risky as parliament can theoretically overturn that later, since it has the right to review Royal Decrees retroactively, given the decrees bypass parliament.

I did not realize that the parliament could overturn a Royal Decree. Do I understand this correctly, and if so, could it be within the realm of possibilities that the tax advantages for existing holders of the LTR will be declared null and void, bringing it all to a level playing field?

[lordgrinz]

I hope this Director General of the Revenue Department was authorized to let this info out, because she could soon become a sacrificial lamb when the proverbial you know what hits the fan. No good will come from her announcement, and it will more than likely cause a mass exodus of capital, exactly what Thailand doesn't need right now. 

[JimGant]

2 hours ago, MeePeeMai said:

My funds are currently co-mingled in my bank accounts in the USA.

 

Going to taxing just income, and not remitted income, means discerning which commingled funds are assessable income, and which are not, will no longer be an item, or a problem.

[Paris333]

I cannot understand since foreigners in Thailand have foreign citizenships and not Thai citizenship then what right does the "Kingdom" of white collars bureaucrats in Thailand have to tax a citizen of a foreign State?
By what right are they going to open up tax accounts at Tax Office Authorities especially for foreign citizens of other States since they do not have the right to vote?

Thai Authorities do not have any rights asking personal inquiries income origin for pensioners of foreign countries since they have paid and  they are paid at their Bank accounts at their home countries.

Complex types of perverse people want to implement such unacceptable mesaures who are jealous because their compatriots live abroad and "having fun" instead of staying at their home countries watching the parade of illegal entrance immigrants from Ukraine -Pakistan -Bangladesh -India and the half Africa continent who used European ready and rich social systems and destroyed it. (free lunch.....other taxable citizens pay for you.....)

There is illegal and unregulated linking to combine foreign nationals' incomes in Thailand with your local internal affairs Law and I think the measure is designed to crack down especially for Τhai nationals with double foreign citizenships who bring untaxed often "laundered money" in Thailand region for the already property bubble.

Ιt will create thousands of complaints from foreign pensioners to the Human Rights Agency Procecutor for discrimination and double illegal taxation of declared income at their origin countries.

Except current Thai Prime Minister Mr Shrettha failled in his intenal affairs financial policy and he wants to be replaced from the opposition Party Mr Pita.

[MeePeeMai]

13 minutes ago, JimGant said:

Going to taxing just income, and not remitted income, means discerning which commingled funds are assessable income, and which are not, will no longer be an item, or a problem.

The problem would be that I have savings (IRA and Roth distributions from prior years) mixed in with my income and some of that account balance I have already paid the tax on in the USA.  It could get ugly when it comes time to convince someone at the Thai RD that my remittances were post-tax savings (not income) when the funds are commingled in my checking accounts.

 

In other words, me proving which money I have already paid the tax on might get complicated when applying the double tax treaty.

 

There is also a government pension deposited each month in that account (which cannot be taxed per the treaty) along with rental income etc.  It could get complicated for me.

[JimGant]

2 hours ago, topt said:

Just so happens that Thailand not only moved the goal posts with the change announced last year but now are talking about moving the whole stadium..........(if it goes ahead)

Nice to finally see some forward thinking in the Thai govt. Finally being able to use the language in their DTAs with other countries (before, if the money wasn't remitted in same year, DTA language was worthless) to collect the taxes stipulated in the treaties -- is a nice, and necessary, touch. Particularly with the looming aging population problem. That I'll spend my last years here in a stable, and sufficiently financed, economy -- is reassuring.

 

And getting rid of the remittance loophole, and going to worldwide taxation, is really a no brainer -- for policy makers who have the country's well-being as their altruistic goal.

[Ben Zioner]

26 minutes ago, CharlesHolzhauer said:

I did not realize that the parliament could overturn a Royal Decree. Do I understand this correctly, and if so, could it be within the realm of possibilities that the tax advantages for existing holders of the LTR will be declared null and void, bringing it all to a level playing field?

LTR giving you a bad itch?

[Antti]

43 minutes ago, JimGant said:

You miss the whole point on the new policy, which won't care about any money brought in -- only income earned in the current tax year, that per DTA, is taxable by Thailand. Nevertheless, all that money in your pre 2024 bank account is now savings, not current year income. Feel free to remit it, or not, as there's no longer a tax angle to it.

 

The switch to taxing global income is just a proposal at this point, if even that. As of now, remittance still matters.

[JimGant]

2 hours ago, spidermike007 said:

If this is indeed true, it seems like a major over reach, and rather draconian. I cannot see it being enforced. And if these govt. goons ever figured out a way to enforce it, the expat population would likely drop to 10,000. 

 

Over taxation is a device used by lazy minds who do not seem capable of running an economy. 

 

Are you talking about going from remittance taxation of worldwide income -- to just pure taxation of worldwide income? Very little, if any, difference -- unless somehow you could exist in Thailand without remitting any (or most) of your assessable income. I believe you're a Yank -- I'd really be interested in why you think the new worldwide income taxation will cost you any money? Thanx for your time.

[AreYouGerman]

4 hours ago, black tabby12345 said:

If your income outside Thailand is already taxed, seemingly no needs to worry about.

Many of the first world countries have tax agreement(not to tax on one same income more than once).

 

The only and major concern is, Thailand might try to tax already-taxed money again by mistake/on purpose.

 

And you would have to file for income tax in Thailand no matter what, even if you will not have to pay any taxes because of DTA. An accountant will easily charge 20,000 THB because the demand for filing will be high.

 

 

[AreYouGerman]

5 hours ago, jvs said:

Of course!

I spend roughly 1 million baht here every year for the past 20 odd years.

If i have to pay tax here most of that will go to a few fat cats,corruption is rife here.

So all of my money is already going into the economy directly, a lot of local people also profit from that.

I pay for some one to go to uni and keep people employed.

Sending some of this money to the government will mean less money for the local people because i will have less to spend.

In most countries paying tax also means you get some benefit,what will we get here?

Yes a very good plan,right?

 

If you don't want be taxed, just vote harder next time! Oh, right. 😂

 

[AreYouGerman]

8 hours ago, Wanderer555 said:

should we remain 2nd class residents with no added value for paying all taxes as required by the Thai RD?

 

Yes.

[AreYouGerman]

8 hours ago, Captor said:

What will we get back? Same as Thais? For example free/cheap healthcare?

 

You are allowed to be in Thailand. Pay up!

[Marco100]

My understanding is that Thailand joins the OECD - CRS and AEOI ( automatic exchange of information ) .

To be part of the OECD club you have to respect certain standards of taxation 😂😂😂 . .... that sayd the rest comes along ....