Its Happening - Law to Tax Overseas Income Now in Progress

[TroubleandGrumpy]

20 hours ago, Yumthai said:

When your wife hands you a couple (or more) of thousands of untraceable cash for your "daily expenses" it will be a gift too.

👍  😉 

[brfsa2]

It actually can happen and work well since Thailand has joined and have access to Common Reporting Standard (CRS) system.

They just need to be able to use it!

 

How the CRS Works in lame terms:

 

1. All financial institutions from participating countries have to identify and report all "reportable" account holders.

 

2. The selection and identification of reportable accounts are based on: residency address, amount in the account, and type of account.

  - Individual accounts: no exemption, everyone is reported.

  - Corporate accounts: those with more than 250,000 USD. 

 

3. If TRD need to audit specific people, it can request via CRS if there are accounts abroad, the banks will have to share the information 

 

TRD will need to be able to use this system effectively. and as well it will depend on the banks on how "diligent" they are to report their foreign accounts.

 

Sources:

- https://www.asco.or.th/uploads/upfiles/files/ASCO article_CRS_ed(1).pdf 
- https://www.rd.go.th/fileadmin/user_upload/FATCA_File/crs/Thailand_CRS_Guidance_280823.pdf 

 

Just my thinking, I could be wrong; I still do believe they left a loophole: Entity accounts with more than 250.000 USD. What if people start signing up for entity accounts and registering a dummy business just to cover the requirements. Then that account can be used to avoid being report via CRS.

 

Also I think there are many other ways people will find loopholes. I Think in the crypto space is where this can't be tracked, and of course, people will look for banks that don't participate in CRS. Another option Im sure people will try to use different residency address. However if TRD request information, they will get it.

 

What I dont know is how effectively the TRD can leverage the use of CRS, just a matter of when! 

 

 

[hwas]

I strongly suspect that once the global tax change goes into effect, the “stay in Thailand less than 180 days” loophole will also be closed.  Thailand will simply require residence visa holders to be resident in Thailand for 180 days, or the visa will be cancelled.  This is a requirement in most countries for residence visas

[JimGant]

3 hours ago, DrPhibes said:

However, If they ask for my US income tax returns, I'm leaving.

Why? Would any Thai taxes due, per DTA, not be a one for one against your US tax return? Or, do you have such substantial Long Term Cap gains, that Thai taxes on would, as a credit, overwhelm your US taxes? Can't think of any other scenario where you might lose money with any new Thai tax scheme.

[VBF]

4 hours ago, sandyf said:

You have the wrong end of the stick entirely, the new State Pension is single tier arrangement so there cannot be a higher tier.

As I said, between 1978 and 2016 the state pension was a 2 tier arrangement, the state pension came in 2 parts, the basic pension and the additional earnings related pension. Many pensioners are receiving their additional state pension as part of a workplace/private pension.

There are however many that never contracted out that are receiving a state pension that consists of the basic pension plus earnings related components, I have 4 such components in my state pension..

I worked with people on shift that were earning twice as much as me as a manager, their state pension could  be well over £400/week.

As I also said everyone only ever refer to the old basic state pension and the new state pension, both in the singular, the additional state pension has been removed from the rhetoric.

Tiers or not, what I wrote is correct - the links go straight to the UK Gov website which itself refers to "The new state pension" - neither you nor I can argue with that!

[Felton Jarvis]

On 9/10/2024 at 12:37 PM, JimGant said:

Are you currently paying US taxes on this retirement income?

i pay at tax time every year. You aren't  American, are you?

[pablo el sueco]

1 hour ago, JimGant said:

Why? Would any Thai taxes due, per DTA, not be a one for one against your US tax return? Or, do you have such substantial Long Term Cap gains, that Thai taxes on would, as a credit, overwhelm your US taxes? Can't think of any other scenario where you might lose money with any new Thai tax scheme.

I believe I may be negatively impacted by such a scenario.  Dividends earned by investing in municipal bonds are not subject to US taxation, but I believe they are not protected by the DTA; if this is true, such dividends may be subject to the proposed new taxation law in Thailand.  However, when it comes to filing a claim for foreign taxes paid, I believe there is a prohibition against claiming tax paid on income that is not subject to US taxation.  I truly hope I am mistaken.

[sandyf]

58 minutes ago, VBF said:

Tiers or not, what I wrote is correct - the links go straight to the UK Gov website which itself refers to "The new state pension" - neither you nor I can argue with that!

The government sites only refer to the old basic state pension and the new state pension, they want to bury the additional state pension, after all it was blatant discrimination.

They like people like you flying the flag for them.

[grain]

My sole income is a monthly pension that on today's ex rate is approx 45,000 THB. So if I'm to pay tax to Thailand what are we talking about? How much would I be expected to pay. I'm not married and don't own any property in Thailand.

[bkk6060]

6 hours ago, Presnock said:

DTA for all in Thai and English anyway for US can be easily found - just google that....or better yet you can go to the Thai Revenue dept website - they carry English too for DTA's and also royal exemption such as that for the LTR for anyone interested.  Best to read the DTA prior to making any real changes to life here.  Good luck

HAHA, hear of sarcasm?  Read the thousands of posts on these topics your DTA information has been repeated 100ś maybe a 1,000 times.  

But, thanks for the update.

[BritManToo]

2 hours ago, hwas said:

I strongly suspect that once the global tax change goes into effect, the “stay in Thailand less than 180 days” loophole will also be closed.  Thailand will simply require residence visa holders to be resident in Thailand for 180 days, or the visa will be cancelled.  This is a requirement in most countries for residence visas

Thailand has no residence visas.

[Mike Teavee]

20 minutes ago, grain said:

My sole income is a monthly pension that on today's ex rate is approx 45,000 THB. So if I'm to pay tax to Thailand what are we talking about? How much would I be expected to pay. I'm not married and don't own any property in Thailand.

Assuming you're under 65 & not paying Tax in your home country on the pension then your income is 540,000 THB p.a., & your allowances are 60K personal allowance + 100K Pension "Expenses" so your taxable income is 380,000 THB:-

• 1st 150K = 0
• 150k-300k = 5% of 150k = 7,500B
• 300K-380k = 10% of 80k = 8,000B

... Total Tax = 15,500B

 

If however you are >65 then you get an additional 190K of allowances taking your taxable income down to 190K...

• 1st 150K = 0
• 150k-190k = 5% of 40k = 2,000B

.. Total Tax = 2,000B

[motdaeng]

31 minutes ago, grain said:

My sole income is a monthly pension that on today's ex rate is approx 45,000 THB. So if I'm to pay tax to Thailand what are we talking about? How much would I be expected to pay. I'm not married and don't own any property in Thailand.

 

8 minutes ago, Mike Teavee said:

Assuming you're under 65 & not paying Tax in your home country on the pension then your income is 540,000 THB p.a., & your allowances are 60K personal allowance + 100K Pension "Expenses" so your taxable income is 380,000 THB:-

• 1st 150K = 0
• 150k-300k = 5% of 150k = 7,500B
• 300K-380k = 10% of 80k = 8,000B

... Total Tax = 15,500B

 

If however you are >65 then you get an additional 190K of allowances taking your taxable income down to 190K...

• 1st 150K = 0
• 150k-190k = 5% of 40k = 2,000B

.. Total Tax = 2,000B

 

the post from khun mike teavee is spot on, but it's important to add:

this also assumes your (khun grain) home country doesn't have a DTA, or if it does, it doesn't provide any benefits for your pension ...

depending on the DTA with your home country, you might not have to pay any taxes here in thailand ...

[david555]

3 hours ago, hwas said:

I strongly suspect that once the global tax change goes into effect, the “stay in Thailand less than 180 days” loophole will also be closed.  Thailand will simply require residence visa holders to be resident in Thailand for 180 days, or the visa will be cancelled.  This is a requirement in most countries for residence visas

Then we all become tourist's again ......like the latest 2 month visa exempt with 30 day extension possible ......and a border run / visit for some day's weeks , month's  

 

Only good adaptable for the "free birds single men"

 

[DrPhibes]

3 hours ago, JimGant said:

Why? Would any Thai taxes due, per DTA, not be a one for one against your US tax return? Or, do you have such substantial Long Term Cap gains, that Thai taxes on would, as a credit, overwhelm your US taxes? Can't think of any other scenario where you might lose money with any new Thai tax scheme.

Not all of us bring all the income earned overseas every year.  I would easily hit the 35% Thai tax rate and you can't net capital gains and losses for the Thai return.   My tax bracket in the US is well below 35% due to net capital gains.  I only bring to Thailand only what I need to live on and it has been seasoned for a year in a separate account before bringing over.  The rest stays invested in the US.

[chiang mai]

It's somewhat ironic that the previous mantra was, only bring into Thailand the money you can afford to lose and, it's not safe to bring money here. Now, everyone's trying to figure out how to get money into Thailand by the most cost effective method. 🙂

 

I feel very fortunate that I brought over large amounts many years ago, and guess what, I've still got it. :))

[david555]

10 minutes ago, chiang mai said:

It's somewhat ironic that the previous mantra was, only bring into Thailand the money you can afford to lose and, it's not safe to bring money here. Now, everyone's trying to figure out how to get money into Thailand by the most cost effective method. 🙂

 

I feel very fortunate that I brought over large amounts many years ago, and guess what, I've still got it. :))

Keep anyway in mind that becomes (possible) reported to you'r home country by CRS reporting since 2022... 🤞

[chiang mai]

2 minutes ago, david555 said:

Keep anyway in mind that becomes (possible) reported to you'r home country by CRS reporting since 2022... 🤞

I'm as clean as a whistle, all above board, even the State Pension people know where I live, how sad is that.

[grain]

1 hour ago, Mike Teavee said:

Assuming you're under 65 & not paying Tax in your home country on the pension then your income is 540,000 THB p.a., & your allowances are 60K personal allowance + 100K Pension "Expenses" so your taxable income is 380,000 THB:-

• 1st 150K = 0
• 150k-300k = 5% of 150k = 7,500B
• 300K-380k = 10% of 80k = 8,000B

... Total Tax = 15,500B

 

If however you are >65 then you get an additional 190K of allowances taking your taxable income down to 190K...

• 1st 150K = 0
• 150k-190k = 5% of 40k = 2,000B

.. Total Tax = 2,000B

I'm 77, so Thailand wants me to pay 2000 Bt a year, no worries mate, I'll happily pay 2000 Bt a year tax and save myself all this stress and worry and plans to remain out the country for 6 months.

[bkk6060]

1 hour ago, grain said:

I'm 77, so Thailand wants me to pay 2000 Bt a year, no worries mate, I'll happily pay 2000 Bt a year tax and save myself all this stress and worry and plans to remain out the country for 6 months.

Yes very good.  So you don't want to cry and moan like some of these babies that you expect free medical coverage, thai social security, and a free Visa if you stay?

[matta01]

For now, the law regarding taxation of worldwide income is just a draft. for the time being we have to pay tax if we stay in Thailand more than 180 days a year and only on the money we bring into Thailand.
 

My question is:

a. on the Thai tax return form there is no space to fill in the amount that you have already paid (double taxation agreement)

b. If you were able to state the amount that has already been paid in the tax form, this would be a completely different result in calculating tax than if you were to fill in the tax form without including what you have already paid.
 

If there is a treaty and you have already paid tax but you only get the official documents later in the year how is this treated? Do you either pay the full amount first or can you only claim it back later in the year when you get the official documents from your home country?

If I am considered as a tax resident, I also expect to be treated equally and not have to pay double prices in a park or be charged a foreigner price in a hospital.

[chiang mai]

1 minute ago, matta01 said:

For now, the law regarding taxation of worldwide income is just a draft. for the time being we have to pay tax if we stay in Thailand more than 180 days a year and only on the money we bring into Thailand.
 

My question is:

a. on the Thai tax return form there is no space to fill in the amount that you have already paid (double taxation agreement)

b. If you were able to state the amount that has already been paid in the tax form, this would be a completely different result in calculating tax than if you were to fill in the tax form without including what you have already paid.
 

If there is a treaty and you have already paid tax but you only get the official documents later in the year how is this treated? Do you either pay the full amount first or can you only claim it back later in the year when you get the official documents from your home country?

If I am considered as a tax resident, I also expect to be treated equally and not have to pay double prices in a park or be charged a foreigner price in a hospital.

Expect away, it aint going to happen.....get used to it.

[OldBird]

On 9/10/2024 at 3:48 PM, gamb00ler said:

The entire balanceI of your nest egg as of Jan. 1 of 2024 will never be subjected to tax in Thailand.  Under the most recent regulations the investment income earned on your nest egg starting from Jan. 1 of 2024 will be considered assessable income if it is sent to Thailand.  However as a Thai resident significant amounts of your assessable income will not be taxed due to several exemptions made available by the Thai Revenue Dept (TRD). 

 

However, if your nest egg is in the form of 401k and/or IRA accounts withdrawals after Jan. 1 2024 may be assessable income in Thailand.

 

Thailand is not allowed to tax US Social Security benefits.

 

Bottom line is that you likely will not have to pay any tax in Thailand.

Thank you very much for that detailed explanation.

[TimBKK]

19 hours ago, JimGant said:

Agreed. Most Yanks I know don't live off substantial annual LT cap gains and dividends. But, yes, there are some.

Yes, there are some indeed .  But, that dividend and long term cap gains info does not necessarily have to end up with the TRD - thankfully (in this instance) “we” are not on the CRS so unless one is audited by the TRD, or willingly submits this info - it could be ok, in a sense.  

[VBF]

3 hours ago, sandyf said:

The government sites only refer to the old basic state pension and the new state pension, they want to bury the additional state pension, after all it was blatant discrimination.

They like people like you flying the flag for them.

Of course they do !

 

The UK Gov sites are to  inform people of the situation today - not what happened in history (which is steeped in "discrimination" as you put it.)

They don't necessarily reflect my personal situation any more than they do yours but they do inform people what they can claim now, or in the future until the rules are changed.

 

However much you like or dislike the ASP it has no import on the present day, therefore no place on Gov sites, which are the final arbiter.

[worrab]

On 9/10/2024 at 9:11 AM, LOG54 said:

Hello

I don't know how to post a link..

Interesting article by Thai examiner on 8th in which they say "very quickly" long term visas will be linked to tax declarations..

Have a good day

 

P.S. Here is the link:

https://www.thaiexaminer.com/thai-news-foreigners/2024/09/08/revenue-department-preparing-legislation-as-new-expat-tax-regime-may-link-visas-and-tax-returns/

They say: It follows that at some point, the tax collection agency may link the tax return to the issuance of visas. Certainly, that will be the moment of reckoning.

[david555]

4 hours ago, chiang mai said:

I'm as clean as a whistle, all above board, even the State Pension people know where I live, how sad is that.

No sad at all ,i just mentioned the controle ,not accusing you  of anithing wrong doing

[Mike Teavee]

22 minutes ago, anrcaccount said:

 

It's laughable you have to try to make up your own guidelines in order to fulfil some inner need for compliance.... Surely you can see the irony here.

 

Rumors of forms being rewritten, making up your own pro rata guidelines... What a joke.

 

 

Completely agree but Tax is often as much about being seen to be doing things "In The Spirit" of the rules as much as following a clearly defined set of rules so what I described about pro-rating the Tax Year is, I believe, common practice when dealing with tax across countries that have different Tax cycles. 

 

[ukrules]

23 hours ago, sandrew33 said:

Potentially true but many countries will have a law that determines tax residency and once a tax resident you remain resident until you establish tax residency elsewhere.  
 

So jumping from country to country avoids you establishing residency in those new countries but you remain tied to country 1 as tax resident. 

 

Well I'm from the UK and to me that's all that matters and I know for sure it doesn't apply to me.

I know the Aussie law doesn't allow you to leave so easily but most countries don't have this kind of 'revert to country of nationality' in place for when you're non resident anywhere - but I don't have a list as it's irrelevant in my situation - I left the UK many years ago and in fact last paid any tax there in the late 1990's, since then I've been on the move.

 

[ElwoodP]

Posts discussing another poster and replies removed.

This is not allowed so please don't do it.