Thailand to tax residents’ foreign income irrespective of remittance

[EVENKEEL]

17 minutes ago, topt said:

You are presupposing that the "vast majority"are from the US I presume?

 

I don't have any stats but I doubt that.........and as @Dogmatix mentions some of us will be potentially royally stuffed........

There's no way for me to speak for anyone else but from the US. Having said that, I think folks are getting riled up over something that is just talk, regardless your home country. With no way for anyone to interpret what the Thais are brewing up, and virtually impossible for them to implement it.

[John Drake]

2 minutes ago, Dogmatix said:

Application of DTAs is a very complex subject and usually involves hundreds of pages of regulations which they have obviously not intention of doing.  

 

What if they simply decide to flat rate a minimum? Base it on the 65,000 per month to meet the visa extension qualification. Anybody who pays less than that has to prove it and come loaded with evidence that can be or (probably) not be accepted. That would be for everybody at the low end. They could still rupture the people at the high and have time to put them at their mercy.

[MeePeeMai]

5 minutes ago, EVENKEEL said:

There's no way for me to speak for anyone else but from the US. Having said that, I think folks are getting riled up over something that is just talk, regardless your home country. With no way for anyone to interpret what the Thais are brewing up, and virtually impossible for them to implement it.

 

Here there seems to be no such thing as "damage control" in order to prevent the inevitable losing face later.

[Dogmatix]

Here is what looks like a fairly accurate translation of an article I found in Thai in Today.  It also contains the bit about a billion baht platform and I have found something posted in Thai on Pantip.com with the same wording.  So I take back what I say about The Thaiger and the Post conflating the billion baht platform from another story about taxing mulitnationals but it is still unclear to me what is meant by the platform. It seems hardly likely that it refers to individuals earning a billion baht plus who will have no problem avoid most of this tax anyway.  Also the Thai version refers to "platforms" earning a billion plus, not individuals.  Perhaps it is to do with catching out local tax dodgers who are selling stuff on e-commerce platforms at home or abroad.  Hopefully there will be follow up statements that will clarify this and other details.  I still cannot find an original official Thai source for any of this, such as Thai PBS. 

 

Apart from the obvious fact that all revenue, customs and excise heads are under huge pressure from the Thaksin administration to help pay for the digital wallet, one reason for wanting to move on to global taxation so soon after introducing the remittance tax may be that that reinterpretation of a 1985 ruling is questionable legally and could easily be challenged.  But if proper legislation is on the way, that could head off legal challenges.

[MeePeeMai]

10 minutes ago, Dogmatix said:

Apart from the obvious fact that all revenue, customs and excise heads are under huge pressure from the Thaksin administration to help pay for the digital wallet, one reason for wanting to move on to global taxation so soon after introducing the remittance tax may be that that reinterpretation of a 1985 ruling is questionable legally and could easily be challenged.  But if proper legislation is on the way, that could head off legal challenges.

 

Correct, I just heard that ALL imported goods (at any price) are now subject to VAT tax.  Gone are the days of VAT free ordering of items under 1500 baht from China (or any other country) on Shopee and Lazada.  Everything is now subject to VAT tax regardless of price and I smell a possible  increase in the VAT percentage coming soon.

 

What ever happened to "Spring it on them slowly, not all at once" so that they don't get their feathers all ruffled?

 

[Dogmatix]

16 minutes ago, John Drake said:

 

What if they simply decide to flat rate a minimum? Base it on the 65,000 per month to meet the visa extension qualification. Anybody who pays less than that has to prove it and come loaded with evidence that can be or (probably) not be accepted. That would be for everybody at the low end. They could still rupture the people at the high and have time to put them at their mercy.

A practical idea but I doubt they could get their minds around that because they have to base everything on what is in the Revenue Code from which that would be a huge departure.  They would also think there are people with income massively above that they wouldn't want to let off the hook.  The UK introduced something like that for non-doms who are foreigners living in the UK with exemption from overseas income.  They told them they could either go on to full UK global tax or pay a flat rate of tax on  a notional quite high income which meant they didn't have to file anything else, except on remittances.   But the non-dom scheme has all but been blown up by the Sunak government.  

 

Essentially the reality is that they are not going to carve out exceptions for a group of foreigners they consider to be making only a marginal contribution.  If they do, it will be along the line of the LTR visa to attract multimillionaires and then change the rules on them a couple of years later. 

[Dogmatix]

Just now, MeePeeMai said:

 

Correct, I just heard that ALL imported goods (at any price) are now subject to VAT tax.  Gone are the days of VAT free ordering of items under 1500 baht from China (or any other country) on Shopee and Lazada.  Everything is now subject to VAT tax regardless of price and I smell a possible  increase in the VAT percentage coming soon.

 

What ever happened to "Spring it on them slowly, not all at once" so that they don't get all their feathers ruffled?

 

 

I agree with you that it feels like a serious of electric shocks and you didn't even mention, if you are a medical cannabis user or not.  You are now living under a Thaksin regime. Authoritarianism doing things in a hurry with great confidence, often taking legislative shortcuts, ignoring democratic principals,  without thinking them through or worrying about any unintended consequences that can be mopped later or blamed on someone else. With a dose of xenophobia thrown in.

[Tonyfarang]

7 hours ago, Hummin said:

Spent almost 18 million the last 8 years in Thailand, and with the new tax rules as it look like today, I would not had settled here with a farm, car, motorbikes, but the land I bought for my wife, is soon more worth than all investments used on the farm itself. 

 

Living cost including travels, insurance, holidays inside Thailand comes down to roughly 1,5 million a year. Living cost in Isaan comes down to 350k only, so the rest is spent on travelling and other things in Thailand. 

 

Cant imagine paying tax for my investments. 

 

Still going to Cambodia is a long shot, because we do not know the future there either. 

 

Going back home and make 2 million a year the next decade sounds better to me, than living full time in Thailand. Free aircondition, fresh air and alot of fresh food to fish, hunt and pick  😉

Exactly same here! Spent way more in less years.. Condos, condos, condos, motorbikes, cars etc... And now preparing to move immediatelly when they will officially announce it. Phils and Malaysia are giving tax exemptions right now, is anyone aware for more details please? I am looking for somewhere I can to and build a normal life, no stress, no "announcements" every day, no complicated visas, reporting etc etc. Someone where, as Andrew Henderson says (Nomad Capitalis) "Go where you treated best" . Please I would appreciate your suggestions & knowledge share. 

[redwood1]

1 hour ago, smew said:

Crazy, so, we are being treated as citizens without the citizen status, privileges and benefits, and visa costs and double pricing and no acces to local hospitals, pay at home country and pay taxes here.. it better be a big joke

 

This is a point I have brought up many times.....

 

Most all country's that ask people to pay tax also throw in some sweeteners....Take the USA.......Paying you taxes also gives you the option to pay into Social Security...And gives you access to medicare health care....

 

Same in Thailand....Paying your taxes gives you the option to pay into Social Security and heath care for Thais and farangs with a work permit....

 

And Now they are hoping that retired expats who have never worked one day in their life in Thailand, and most with no business interest or investments at all in Thailand and who also have no rights and are treated like children by immigration with 90 day check ins and what not... 

 

Will be happy to shell out for taxes and and be given a big fat ZERO in return....

 

Any one who thinks this is in any way fair is just a stupid sheep that deserves to be sheared....

[MeePeeMai]

2 minutes ago, Dogmatix said:

 

I agree with you that it feels like a serious of electric shocks and you didn't even mention, if you are a medical cannabis user or not.  You are now living under a Thaksin regime. Authoritarianism doing things in a hurry with great confidence, often taking legislative shortcuts, ignoring democratic principals,  without thinking them through or worrying about any unintended consequences that can be mopped later or blamed on someone else. With a dose of xenophobia thrown in.

 

That seems to sum it up pretty well.  My cannabis days are long behind me but I did more than my share in my teens.

[Dogmatix]

2 hours ago, MeePeeMai said:

I don't usually listen to this guy but here he is doing a great rant on the subject and it seems that he's a bit pissed off about it too.

 

 

 

He is a lawyer and says he doesn't know what steps are involved in amending laws in Thailand which is odd.  On the other hand he is right to point out that the director general of the Revenue Department doesn't have the power to amend the Revenue Code herself.  What her predecessor did in reinterpreting the law to introduce the remittance tax is highly questionable legally and could be challenged which may be a reason for the haste in moving on to try to amend the law.  

 

Since he was unable to inform what steps are involved, here they are.

 

1 Cabinet approval

2 Vetting of the proposed draft by the 'Council of State, the government's official legal advisor.

3 a, Royal Decree amending the Revenue Code.  

OR

3 b. Bill to amend the Revenue Code.

4. Three readings of the bill in parliament.

5. Announcement in Royal Gazette of Act to amend the Revenue Code.

 

The Royal Decree is supposed to be used for urgent legislation that can't wait for the parliamentary process and is frequently used for fairly minor tax amendments.  An amendment like this is a major change and it would be appropriate to use the full parliamentary process.  However, Thaksin sponsored administrations in the past have been quite notorious for using Royal Decrees for non-urgent legislation when an Act of parliament would have been appropriate.  It is a bit of a risk because a Royal Decree can theoretically be challenged and overturned in parliament later with negative consequences for the government that issued it. However, if you very confident in your parliamentary majority, you might not care about this risk.  They could argue that collecting more tax is a matter of great urgency. Hopefully the parliamentary process would be used to follow democratic norms and legitimize a major change but no guarantees with this government.

[Sheryl]

1 hour ago, jayboy said:

 

Is there in a situation where there is no assessable income? For example if an expatriate resident only remitted savings acquired before 31.12.2023 and retained current income in an overseas account.Then there would be no need to file a return, right?

 

 

There are certainly situations where there would be no assessable income e.g. people whose income source is specified in a DTA as not assessable in Thailand (US citizens with  only Social Security and or government pensions; UK citizens  with only governmenf pebsion etc)

 

People living entirely on savings would have no assessable income unless they received interest on their savings (but of course most do)

 

For the second part of your question correct as of now but  if law is changed as proposed then remitted otlr not, interest income would be assessable. 

[CLUBBER]

Another reason I’m so glad I listened to a wise man’s advice over 20 years ago and never bought any property here ! I will just be a part time resident if even that soon enough 👍🏼

[sandyf]

6 hours ago, black tabby12345 said:

 

You cannot judge everything in Thailand with the first world standard common sense.

Here, they often exercise what is unthinkable to you back home.

That is why the joke below makes us laugh and makes sense.

Same Same, but Different.

After 25 years I have a good idea of how things are done but you are perfectly free to believe the garbage that gets posted.

[placnx]

On 6/5/2024 at 5:15 PM, timendres said:

An article on Bangkok Post clearly shows that they are discussing taxing worldwide income.

Currently, only two countries on the planet do this. The USA and Eritrea.

This is a desperate act by the Thai government, and demonstrates that things are not good.

France also taxes on worldwide income of residents.

[NorthernRyland]

2 hours ago, MeePeeMai said:

I don't usually listen to this guy but here he is doing a great rant on the subject and it seems that he's a bit pissed off about it too.

 

He's good on these topics because he questions the premise and authority unlike some of the browbeaten sheep posting here that believe they don't have a right to their own money.

[gearbox]

35 minutes ago, Tonyfarang said:

Exactly same here! Spent way more in less years.. Condos, condos, condos, motorbikes, cars etc... And now preparing to move immediatelly when they will officially announce it. Phils and Malaysia are giving tax exemptions right now, is anyone aware for more details please? I am looking for somewhere I can to and build a normal life, no stress, no "announcements" every day, no complicated visas, reporting etc etc. Someone where, as Andrew Henderson says (Nomad Capitalis) "Go where you treated best" . Please I would appreciate your suggestions & knowledge share. 

Here is your guide...pick up a country.

 

https://en.m.wikipedia.org/wiki/International_taxation

 

From what I see Malaysia will tax remitted foreign income under certain conditions. The Philippines seems to remain the only comparable country around which doesn't tax foreigners who are tax residents. There are quite a few countries without income tax, and also many with only territorial taxes, but I wouldn't live permanently in any of them.

[NorthernRyland]

39 minutes ago, redwood1 said:

Any one who thinks this is in any way fair is just a stupid sheep that deserves to be sheared....

My thoughts exactly. Some people are such pathetic chumps. Already spinning it their heads that they're doing the right thing and they think the rest of us should follow them off the cliff.

[DavisH]

On 6/5/2024 at 3:52 PM, John Drake said:

It was slowly at first, but now more and more people are coming to understand that:

 

Prayuth was better.

This government may not see out the year....

[gearbox]

52 minutes ago, MeePeeMai said:

 

Correct, I just heard that ALL imported goods (at any price) are now subject to VAT tax.  Gone are the days of VAT free ordering of items under 1500 baht from China (or any other country) on Shopee and Lazada.  Everything is now subject to VAT tax regardless of price and I smell a possible  increase in the VAT percentage coming soon.

 

What ever happened to "Spring it on them slowly, not all at once" so that they don't get their feathers all ruffled?

 

That's nuisance, I spent thousands of $ with AliExpress on all sorts of bits and gadgets, now it will cost more with extra paperwork. But is happening in many places, Australia introduced it ages ago, the so called "Harvey Norman" tax.

[hotandsticky]

48 minutes ago, Dogmatix said:

 

I agree with you that it feels like a serious of electric shocks and you didn't even mention, if you are a medical cannabis user or not.  You are now living under a Thaksin regime. Authoritarianism doing things in a hurry with great confidence, often taking legislative shortcuts, ignoring democratic principals,  without thinking them through or worrying about any unintended consequences that can be mopped later or blamed on someone else. With a dose of xenophobia thrown in.

 

I am encouraged.

 

As odious as I find Thaksin, I am amongst the first to acknowledge that he is not stupid.

 

Being not stupid hopefully guarantees that the idiocy of the ramifications for expats never sees the light of day.

[shdmn]

8 minutes ago, hotandsticky said:

 

I am encouraged.

 

As odious as I find Thaksin, I am amongst the first to acknowledge that he is not stupid.

 

Being not stupid hopefully guarantees that the idiocy of the ramifications for expats never sees the light of day.

He also appears to have magical healing powers.  One day he was sick and needed to be released from prison on medical grounds, and then he miraculously got well almost over night.  He also appears to be able to shape shift his ailments.  Initially admitted to the prison hospital for chest tightness and high blood pressure, then shown after release with a neck brace and arm sling, both of which he no longer needed days later.

[placnx]

On 6/5/2024 at 6:04 PM, Presnock said:

Yes the US taxes on worldwide income but if you earn a salary overseas, the US govt allows a deduction on the taxes for that salary if I am not mistaken...Called foreign earned income reduction!

https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion

You can deduct up to $120K of foreign earned income from total income on US taxes. So if you earned that in Arabia for example, then that could be taxable in Thailand besides the other income reported (and taxed) in the US.

[Gknrd]

Honestly anyone with two brain cells knew the direction of Thailand years ago. Everyone else pay up or leave. Simple.

Anyone from the US that went and invested? Unless you have some serious income and reservers get ready to go back to the US and rent an apartment for 2K / mo... haha. Or Strart border hopping. To try and keep your live in, or spouse and property you spent your life savings on...  Hoping she doesn't kick you to the curb and keep your property.. 

 

 

[shdmn]

16 minutes ago, Gknrd said:

Honestly anyone with two brain cells knew the direction of Thailand years ago. Everyone else pay up or leave. Simple.

Anyone from the US that went and invested? Unless you have some serious income and reservers get ready to go back to the US and rent an apartment for 2K / mo... haha. Or Strart border hopping. To try and keep your live in, or spouse and property you spent your life savings on...  Hoping she doesn't kick you to the curb and keep your property.. 

 

 

None of the whiners are going anywhere.  They just like to huff and puff (and whine) about everything. They have nowhere else go because if they did they would have left a long time ago.  I remember many years ago everyone was saying they were going to Cambodia because Thailand was getting too expensive and visa hassles blah blah.  Same old same old.  I would say less than 1% actually did and of those, probably 99% moved back.

[sandyf]

1 hour ago, MeePeeMai said:

I just heard that ALL imported goods (at any price) are now subject to VAT tax. 

Wrong. I have just had a package delivered from India by Thai Post without any additional charges. Value was around $45 USD.

[Dogmatix]

15 minutes ago, hotandsticky said:

 

I am encouraged.

 

As odious as I find Thaksin, I am amongst the first to acknowledge that he is not stupid.

 

Being not stupid hopefully guarantees that the idiocy of the ramifications for expats never sees the light of day.

Thaksin can also change his mind quickly, e.g. he refused to agree with MFP on amnesty for lese majeste offenders when they were negotiating over a coalition but now he has been charged with LM himself PT is suddenly proposing amnesty for LM offenders. 

 

He is smart but impetuous and stubborn and doesn't always think things though. He could have avoided the first coup by just volunteering to pay quasi tax on the SHIN sale. He could have made a large donation equivalent to tax to the poor that he controlled and got huge brownie points from the reds and thwarted the yellows. He could have recovered the "tax" very fast by staying in power.  He didn't think of that or was too stubborn and tight fisted to do it. 

 

Next he didn't think though the rice pledging scam or didn't listen to advice about it.  He believed he could corner the global rice market by buying up Thai stocks with taxpayer money and storing it.  But he used historic numbers over the prior periods when India had continuous droughts and floods that allowed very little exports.  He didn't take into account the risk that India would have good weather and a bumper harvest which it did allowing it to export big time. Vietnam also had a good harvest that year and made big exports trashing the global price and leaving the Thai government sitting on huge losses, totally powerless to corner the rice market as he planned.  He also didn't consider or care that he was putting his sister at grave risk of going to prison or having to flee.  In spite of all this there was still money to be made from the fake sales to China that were actually pledged back to the Thai government. But whatever was made from that part, it is hard to argue that this scam was not a catastrophic failure on many levels. Several minions went to prison for taking fairly modest bribes to facilitate the scam and are still there.

 

In the current context, I feel that Thaksin had already organised his overseas affairs long ago to avoid having to pay significant Thai tax as a result of this tax change.  

 

 

 

[Dogmatix]

Just now, sandyf said:

Wrong. I have just had a package delivered from India by Thai Post without any additional charges. Value was around $45 USD.

 

There is a thread on AN today saying this proposal has only just been approved by the cabinet.  Next stage is a finance ministry order in the Royal Gazette that could happen soon. Then it will come into effect 15 days later.  It is going to be in effect till the end of this year and will be reviewed to decide whether it will be extended or not. I guess a foregone conclusion that, no matter how much chaos it causes or how costly it is to collect amounts of tax under 10 baht, it will be hailed as great success and made permanent, assuming the government is still in power.

[BE88]

I recently left Thailand for a holiday but now with this news and the expected change of visas that will be modified and cancelled I have no desire to return and will calmly wait for what their stupid decisions will be yet to come because I am convinced that more bad news for expats is coming.

[Dogmatix]

One of the major concerns is the same as for the remittance tax.  That is that RD officials will demand the same type of documentation that is available in Thailand, i.e. foreign tax receipts certified by the tax authority, proper contract notes for stock transactions, official dividend receipts showing tax deductions etc.  Otherwise they might just make you pay tax on the gross amount with no tax credit.  If the proceeds from a stock sale of $100k is appears in the CRS report for your bank account and you have made a $50k profit but can't produce an official contract note for buying it 10 years earlier or for selling it, that's you paying 35% tax on the whole $100k.  The Thai system is not the same as countries like the US and the UK where you file a self assessment and they accept that in the vast majority of cases without demanding documentation - only if they do an audit.  In the Thai system you file your tax return online like that but a letter follows a few months later demanding original documents to support your income and documents in every case. If you file in person with an RD officer, which I have never done,  I believe they will ask for the documents on the spot.