Its Happening - Law to Tax Overseas Income Now in Progress

[ikke1959]

They don't have a clue what the local Thai people are doing and earning, how can they know what foreigners are earning/Where and how do they get the information from? I am  not sure if all financial institutions are giving all informations as may countries have a law to protect the personal information. And besides that how do they use all the different languages, forms, etc Almost nobody can speak or read English here.. I think it will be just as everything a lot of screaming but in reality nothing will  happen.

Thais don't like to work

[redwood1]

There are 195 countries on Earth...I bet there are expats in Thailand from 100 of them...

 

I will say there is no way the disorganize, corrupt, flip flopping mess that is the Thai government could ever in a million years track and keep up with the personal finances of the expats from all these countries..

 

Folks its just not going to happen EVER......

 

Especially when the mega rich leaders of the country avoid taxes like the plague...

 

 

[JimHuaHin]

Correct me if I am wrong, but this is going to open a massive can of worms, and huge implementation problems for the TRD.

 

Will income or taxable income be taxed?  In other words, will Thailand recognize that certain income in country A is not taxable in country A, that country A allows for certain allowances and deductions which are not available in Thailand?

 

Will all current Thai DTAs be strictly enforced, or will they have to be renegotiated/amended?

 

How will people who have annuities or superannuation pensions, which have already been taxed when contributions were made, and are thus not taxed when payments are made, receive their annual reports which provide no indication of tax paid, as tax was paid many years in the past when contribution were made, successfully explain this to the TRD?  (The Australian Tax Office understands this, but will the TRD??  Will the TRD demand that I get a valid authorized documents from the ATO/super fund stating how much tax was paid 40 years ago when I started paying super??)

 

The conversion of daily, weekly, monthly, etc. foreign incomes, and allowances/deductions, to Thai Baht would mean that the TRD would have to provide a daily exchange rate for every global currency into Thai Baht.  Which in turn will present a burdensome nightmare to the expat tax resident attempting to calculate their foreign (taxable) income in Thai Baht.

 

Yes, it is doable, in advanced countries when the national taxation authority is automatically supplied income/tax data from all local employers, all local financial institutions, all government social welfare/security departments which provide government payments/pensions to the population, and various other government and private authorities.

 

But, TIT.

 

 

[Presnock]

2 hours ago, ikke1959 said:

They don't have a clue what the local Thai people are doing and earning, how can they know what foreigners are earning/Where and how do they get the information from? I am  not sure if all financial institutions are giving all informations as may countries have a law to protect the personal information. And besides that how do they use all the different languages, forms, etc Almost nobody can speak or read English here.. I think it will be just as everything a lot of screaming but in reality nothing will  happen.

Thais don't like to work

yeah some of that may be true because as of yet it hasn't happened and when/if it does we have to read the fine print.  But, as for how much money we send here, the local banks could be ordered by the government to provide that to the revenue dept.  ALso FACTA CRS and whatever else the OECD has as far as reporting goes can be altered to ensure that all people are taxed on their incomes - that is one of the main drivers of the 2023 summer agreement signed by 138 countries around the world.  They will continue to fine tune the requirements that they all have agreed to in order to have everyone paying taxes to some government.  In addition, jumping from country to country to avoid becoming a tax resident may also be changed as countries will begin to see patterns of people not paying taxes somewhere by doing these jumps before becoming a tax resident there.  Yeah many changes could happen but who knows exactly what is going to happen and when?  As countries become more and more hungry for tax dollars, they will continue to look at the easiest to control - expats usually fit that bill.  Good luck to all.

[Thailand J]

48 minutes ago, redwood1 said:

I will say there is no way the disorganize, corrupt, flip flopping mess that is the Thai government could ever in a million years track and keep up with the personal finances of the expats from all these countries..

Some may think cheating is unlikely to get caught here..plus the magic of brown envelope will keep you from harm.

but I know I can't sleep well if my tax is not in good order...I may walk into a tax revenue office to confess  🙂

[mdr224]

If you dont want to pay taxes in thailand, then dont do it. Simple as that

[simon43]

It's great to be poor.  I never have to worry about paying tax ANYWHERE! (and I have not paid tax in any country for more than 22 years because I legally haven't had to pay tax!).  5 flags theory etc...

 

Anyway, I'm off to do some more street-begging.  Have a nice day 🙂

[Gottfrid]

The biggest problem here is not the taxation itself. The horrible thing is that they will just take the money, and we will not be included in neither health system nor any pension system.

[connda]

If they plan on coming after foreigners, then they going to have to rewrite their current tax forms to include exemptions for exempted income listed under under each foreign country's Dual Tax Agreements.  I've looked at the tax form and see no such category. 

[newbee2022]

12 hours ago, CharlieH said:

Courtesy of Revenue Dept.

 

The Thai Revenue Department is currently drafting legislation to tax the overseas income of individuals residing in Thailand.

 

According to Kulaya Tantitemit, the director-general of the department, this draft is aligned with the international principle of worldwide income under the residence rule.

 

This principle mandates that an individual's income, regardless of its origin, should be taxed by the country where the individual resides for a specific period.

 

To implement this, an amendment to Section 41 of the Revenue Code is required. The proposed amendment would require individuals residing in Thailand for 180 days or more to pay personal income tax on overseas income, even if that income is not brought into Thailand.

 

In the first 11 months of the 2024 fiscal year, the Revenue Department collected 1.963 trillion baht, surpassing its target by 0.4% or 8.44 billion baht.

 

This strong performance was attributed to government measures aimed at stimulating consumption, such as the easy e-Receipt program, which boosted the collection of value-added tax from domestic consumption. 

 

Ms. Kulaya anticipates that by the end of this fiscal year on September 30, the department will meet its target of 2.28 trillion baht.

 

For the fiscal year 2025, beginning on October 1, the Ministry of Finance has set a target for the department to collect 2.372 trillion baht.

 

Credit Bangkok Post.

 

2024-09-07

 

 

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When I mentioned this a couple of weeks ago, I felt as 'stoned and feathered' by all those "I know all better" here on AN. 

Shame on you 🤗

[bkk6060]

8 minutes ago, Gottfrid said:

The biggest problem here is not the taxation itself. The horrible thing is that they will just take the money, and we will not be included in neither health system nor any pension system.

Yes, but you get access to many younger beautiful women. How much is that worth?

[Presnock]

Just now, connda said:

If they plan on coming after foreigners, then they going to have to rewrite their current tax forms to include exemptions for exempted income listed under under each foreign country's Dual Tax Agreements.  I've looked at the tax form and see no such category. 

Those that have visited the Revenue Dept say that the new tax forms are due out in Nov/Dec timeframe and hopefully we will get better guidance from the RD on whether or not we are forced to get a tax ID and/or fill out forms even if no assessable income (i.e. exempted pensions, LTR exemption).  Anyway best of luck to all on this tax.

[lordgrinz]

My wifes taxes already reach almost the 25% bracket for Thailand, so anything I add to our tax form will be taxed at 25% or more, where I am now currently paying nothing to the USA. Hopefully this new change never happens, but I am not going to give them any of my money, that's just not going to happen.

[Presnock]

2 minutes ago, newbee2022 said:

When I mentioned this a couple of weeks ago, I felt as 'stoned and feathered' by all those "I know all better" here on AN. 

Shame on you 🤗

Such is daily life on THIS forum for sure as folks here just seem to want to criticize anyone whenever they read anything whether is is interesting or informative or what.  Just like they enjoy blaming the victims of anything here!

[grain]

7 minutes ago, Gottfrid said:

The biggest problem here is not the taxation itself. The horrible thing is that they will just take the money, and we will not be included in neither health system nor any pension system.

That's how I see it too. If after 180 days we become classified as "residents" and start to pay tax, then issue us all with a resident ID card, to distinguish us from tourists and travelers. The card doesn't give us rights to Thai citizenship or to own property or anything like that, but the card gets us the Thai price at gov hospitals to see a doc and get meds, and the card gets us Thai price admission at national parks and historical sites. Because as tax payers we will be contributing towards these things.

[proton]

I would rather die than give these buggers in power any income tax, so leaving for 6 months is certainly an option, even if it costs more.

[chiang mai]

Give generously, you know it makes sense and is a worthy cause.

[lordgrinz]

So they want us to do 90 day reports, do TM30's, do TM6's, do yearly extensions, do reentry permits, pay farang fees at parks, get COR's for drivers licenses, not allow us to own property, and in the news recently they want to create a farang tax on buying and selling real estate? And now they want to tax us on our WorldWide income, offering nothing in return for that money?! 

 

Give us land ownership, Permanent Residency, no more TM47/TM30/COR's/TM6/Etc., make farang pricing illegal, treat us like tax paying Thai citizens and then maybe being taxed on WorldWide income might make sense.

[Kerryd]

The way it works is, you are expected to report ALL income you make outside (and/or inside) of Thailand.

Pension income that is already taxed in your home country still counts towards your total income even if there is a Tax Treaty between your country and Thailand.
However, Thailand wouldn't (legally) be allowed to tax that portion of your total income.

They would then total all your income, subtract the "personal deduction" and tax you on the balance (at whatever rate).

It's unlikely you will get any deductions for charity donations or medical expenses or anything else you would normally be able to deduct from your taxes back home.

However, if you also have to do taxes back home on the same income and Thailand has charged you more than your home country, you can (in some countries at least) claim the difference as a credit on your home country's taxes.

This is a link to the Government of Canada's list of Tax Treaties:
https://www.canada.ca/en/department-finance/programs/tax-policy/tax-treaties.html

Most of the treaties are virtually identical and include clauses for things like pensions taxed in one country can't be taxed in the other.
For the Phillipines:

Pensions and Annuities

1. Pensions and annuities arising in a Contracting State and paid to a resident of the other Contracting State shall be taxable only in the Contracting State in which they arise. (Then some gibberish about "periodic pension payments".)

For Thailand:

Pensions

1. Pensions and other similar remuneration, whether they consist of periodic or non-periodic payments, for past employment, arising in a Contracting State and paid to a resident or the other Contracting State shall be taxable only in the first-mentioned State.

(Canada does not have, nor is negotiating a tax treaty with Cambodia so technically you could be fully taxed on all your income in your home country and in Cambodia.)

Also note: Tax treaties do NOT confer ANY "rights" to the person being taxed.

"No Taxation without Representation" is an "ideal" and "principle" - not a law.

[newbee2022]

11 minutes ago, Presnock said:

Such is daily life on THIS forum for sure as folks here just seem to want to criticize anyone whenever they read anything whether is is interesting or informative or what.  Just like they enjoy blaming the victims of anything here!

Thank you. Probably the only for consolation 😳

[Gottfrid]

18 minutes ago, bkk6060 said:

Yes, but you get access to many younger beautiful women. How much is that worth?

I can read that you are still in playschool. Take your time now, and carefully calculate how much it´s worth for you, and then leave the tax changes to the grown ups.

[Rampant Rabbit]

omitted from the OP

 

If and when it is enacted

[Kerryd]

From a (newspaper) article dated 6 Sept:
"Expats in Thailand, meanwhile, have raised questions about tax treatment of pension income from past employment when that money is brought into Thailand.

If this money is taxed in their home country and that country is one of the 61 that have agreements with Thailand to prevent double taxation, in theory there should be no problem.

But debates about interpretation of the law are ongoing."

They have a link to a legal website that discusses the "ongoing" matter.

In the article from 24 June 2024 they note:
Last year, the Thai Revenue Department (“TRD”) issued Departmental Instructions No. Paw 161/2023 and Paw 162/2023 concerning foreign-sourced income. According to these instructions, any Thai tax resident with foreign-sourced income will be taxed in Thailand when such income is remitted into the country, regardless of when you remit it.

"The proposed new rule will affect both foreigners working in Thailand for more than 180 days and Thai citizens who are Thai tax residents working abroad. A key question is whether this new rule will affect Long-Term Resident (LTR) Visa holders. The answer is: “It Depends”.

Currently, the interpretation is issued as a guideline. The LTR rules will prevail based on the hierarchy of laws and the principle of lex specialis. However, if the TRD chooses to amend the Thai Revenue Code, the new rule will likely take precedence. Nonetheless, the government is unlikely to do this, as the LTR is designed to benefit LTR holders."



 

 

[Pouatchee]

10 hours ago, stoner said:

 

don't bother sending yourself money. take the few dollars hit at the ATM. if its only 2 months you wont need to visit the ATM more than a couple times. so 50 bucks to get them off your back sounds reasonable. 

 

i get what your saying... but that cash would be sent here to minimize the taxation effect the day i come back here to live permanently later on. it might be a loophole. not living here 180 days it shouldnt be taxable... 

[Pouatchee]

6 hours ago, save the frogs said:

so that means she will have 6 other boyfriends.

that's not a relationship

 

can be, but been with her long enough and i trust her in that regards. cant say the same about too many thai ladies... will have to wait and see

[nong38]

11 hours ago, swissie said:

Plenty of Thai "legal eagles" that made it possible for Farangs to stay in Thailand as far as Visas are concerned. For a price.

As I write, a new generation of Thai "legal eagles" are preparing to find possibilities for Farangs to circumvent taxation.
For a price.

Actually the new "business" for Thai Lawyers will be more rewarding than the old "hum drum" Visa business.

A new source of income for underemployed lawyers in Thailand has just opened.

Either way you pay more than the zero currently being paid.

[stoner]

5 minutes ago, Pouatchee said:

 

i get what your saying... but that cash would be sent here to minimize the taxation effect the day i come back here to live permanently later on. it might be a loophole. not living here 180 days it shouldnt be taxable... 

 

anyone you can *gift* the money to ? a family member perhaps.

[SiamAndy]

26 minutes ago, lordgrinz said:

So they want us to do 90 day reports, do TM30's, do TM6's, do yearly extensions, do reentry permits, pay farang fees at parks, get COR's for drivers licenses, not allow us to own property, and in the news recently they want to create a farang tax on buying and selling real estate? And now they want to tax us on our WorldWide income, offering nothing in return for that money?! 

 

Give us land ownership, Permanent Residency, no more TM47/TM30/COR's/TM6/Etc., make farang pricing illegal, treat us like tax paying Thai citizens and then maybe being taxed on WorldWide income might make sense.

If they want to tax Resident expats, then they should also let us in on the 30 Baht health scheme as well.

[redwood1]

25 minutes ago, Kerryd said:

From a (newspaper) article dated 6 Sept:
"Expats in Thailand, meanwhile, have raised questions about tax treatment of pension income from past employment when that money is brought into Thailand.

If this money is taxed in their home country and that country is one of the 61 that have agreements with Thailand to prevent double taxation, in theory there should be no problem.

But debates about interpretation of the law are ongoing."

They have a link to a legal website that discusses the "ongoing" matter.

In the article from 24 June 2024 they note:
Last year, the Thai Revenue Department (“TRD”) issued Departmental Instructions No. Paw 161/2023 and Paw 162/2023 concerning foreign-sourced income. According to these instructions, any Thai tax resident with foreign-sourced income will be taxed in Thailand when such income is remitted into the country, regardless of when you remit it.

"The proposed new rule will affect both foreigners working in Thailand for more than 180 days and Thai citizens who are Thai tax residents working abroad. A key question is whether this new rule will affect Long-Term Resident (LTR) Visa holders. The answer is: “It Depends”.

Currently, the interpretation is issued as a guideline. The LTR rules will prevail based on the hierarchy of laws and the principle of lex specialis. However, if the TRD chooses to amend the Thai Revenue Code, the new rule will likely take precedence. Nonetheless, the government is unlikely to do this, as the LTR is designed to benefit LTR holders."



 

 

 

I have never in my life seen any government or business for that matter that backtracks, flip flops, changes policy at the drop of a hat , with healthy doses of it was all a big misunderstanding....Like Thailand.

 

What the government is likely or unlikely to do is a crapshoot that changes day to day.....So the LTR is in no way a safe haven AT ALL....

[Pouatchee]

6 minutes ago, stoner said:

 

anyone you can *gift* the money to ? a family member perhaps.

 

first i have to go back and earn it...555 dunno how thats gonna go. yeah i can gift it... but while away, the 180 law doesnt apply so easy... i already have a bank acct connected to thai acct.

 

when you mention gifting is that while here or abroad?

if its while here the question is how many times in a given lapse of time can you do so?