Its Happening - Law to Tax Overseas Income Now in Progress

[connda]

2 hours ago, Kerryd said:

So they told ASEAN that the tax would apply to Thais and "permanent" residents.

Makes you wonder if something has been lost in translation perhaps ? Maybe they meant "long term residents" ?

Or maybe others think "permanent" residents and "long term Visa holders" are the same thing ?

Is there an actual draft of the actual regulation somewhere or is it still a "work in progress" somewhere ?

I know one thing for sure.  Every year when I submit my extension based on marriage, right their in bold letters it says that I'm only "Visiting my Thai wife."   So much for "permanent." 

[connda]

2 hours ago, HappyExpat57 said:

I suspect renewing your extension will be tied in with proof of filing taxes. Nothing good will come of this to retirees.

I'll worry about that in Dec 2025.

[redwood1]

10 minutes ago, connda said:

And provide an path for "tax residents" to become Permanent Residents based on their tax status, and to eventually be able to have a path to Citizenship as we are taxed like Thai citizens. 

 

Sir you must be joking....No way ever will this happen...Maybe a 50% discount on a McDonalds happy meal for tax payers.....If your lucky....

[jumbo]

A piece from the Bangkok Post

 

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.

 

Ms Kulya said that in practice, collection of tax on foreign income will depend on international cooperation and information exchange. Thailand is already a member of the tax information exchange group spearheaded by the Organisation for Economic Co-operation and Development (OECD).

 

 

 

Please credit and share this article with others using this link: https://www.bangkokpost.com/business/ge … the-works. 

 

[Denim]

2 hours ago, Rampant Rabbit said:

omitted from the OP

 

If and when it is enacted

 

Exactly. Don't jump. Wait until the pushing starts.  No point in getting your boxers in a twist until  it actually happens.

 

 

[John Drake]

Question: Does this tax on worldwide income mean that you will be taxed for your salary, say, in the US, where you keep most of your money? And THEN when you move some of that money to Thailand that Thailand has already taxed you on, will they also tax the remittance? Tax the money a second time they've already taxed before?

[tomkenet]

21 minutes ago, jumbo said:

A piece from the Bangkok Post

 

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.

 

Ms Kulya said that in practice, collection of tax on foreign income will depend on international cooperation and information exchange. Thailand is already a member of the tax information exchange group spearheaded by the Organisation for Economic Co-operation and Development (OECD).

 

 

 

Please credit and share this article with others using this link: https://www.bangkokpost.com/business/ge … the-works. 

 

This rule was revised effective from Jan 1, 2024. Tax is now payable on foreign income regardless of when it is brought into the country. To give an example, Mr A sold shares in an overseas company in 2020, realised a capital gain and banked the money in an overseas account. If he brings the proceeds from that capital gain into Thailand in 2024, he must report it as assessable income when filing a tax return.

Please credit and share this article with others using this link: https://www.bangkokpost.com/business/general/2860812/law-to-tax-income-from-overseas-in-the-works.. View our policies at http://goo.gl/9HgTd and http://goo.gl/ou6Ip. © Bangkok Post PCL. All rights reserved.

 

Not much confidence in this article.

Seems like the author hasn't heard about P.O.162

[Callmeishmael]

I strongly suspect that the main group for this proposed law is wealthy Thais who have overseas property and investments.  While some of us may get caught up in this mess, I think that we will be incidental damage, not the main target!

[NanLaew]

11 hours ago, NoDisplayName said:

I might consider getting me one of them 10-year China visas.  Unlimited entries for the bargain price of $140.  China also has a global tax system, but only takes affect for expats after 5 continuous years of tax residency, and the clock resets anytime you leave the country for more than 30 days.

 

That sounds pretty good.

 

But China...

[NanLaew]

6 minutes ago, Callmeishmael said:

I strongly suspect that the main group for this proposed law is wealthy Thais who have overseas property and investments.  While some of us may get caught up in this mess, I think that we will be incidental damage, not the main target!

 

Even collateral damage can be punitive and expensive.

[biervoormij]

1 hour ago, Taboo2 said:

If your 401 is taxed, which most are, it is exempt.

The US DTA does not cover IRA or 401K distributions so not exempt like social security or government pensions. I don't know how the Thailand RD will deal with this but saying it is exempt is not correct. I think if you are taking large 401K distributions you will have to pay the much higher Thailand tax rate.

[jacob29]

4 hours ago, JimHuaHin said:

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?

The safe default assumption, is that it will be treated the same way the majority of countries in the world deal with it. You can explore what any other country taxing worldwide income does. Which is not always clear, but Thailand doesn't need to reinvent the wheel here.

[Jingthing]

4 minutes ago, biervoormij said:

The US DTA does not cover IRA or 401K distributions so not exempt like social security or government pensions. I don't know how the Thailand RD will deal with this but saying it is exempt is not correct. I think if you are taking large 401K distributions you will have to pay the much higher Thailand tax rate.

This is a very interesting issue to me as I have a traditional taxed in the US as income IRA.

People with Roth IRA's are not taxed on withdrawals.

What's confusing to me is that why should the Thai tax system see any withdrawal from basically a retirement savings account (Roth IRA, trad IRA, or 401K) as income even if the U.S. system does? I'm not certain that they would. 

Also, IF they do, aren't people with Roth IRAs at risk as being taxed on withdrawals by Thailand even though they're exempt in the U.S.?

Is there really any DTA law to cover this mess?!?

[anchadian]

All my income is sent directly to my Thai wife's bank account and I withdraw our living expenses each month and the balance of monies remaining is left in her account.

 

I have no other family members when I pass.

[biervoormij]

8 minutes ago, Jingthing said:

This is a very interesting issue to me as I have a traditional taxed in the US as income IRA.

People with Roth IRA's are not taxed on withdrawals.

What's confusing to me is that why should the Thai tax system see any withdrawal from basically a retirement savings account (Roth IRA, trad IRA, or 401K) as income even if the U.S. system does? I'm not certain that they would. 

The thing I find frustrating is the lack of details on issues like this. Until someone does a tax return we may not know how the RD will see these distributions and it may change between the current remitted income and if this global income comes into law.

[mokwit]

3 hours ago, HappyExpat57 said:

I suspect renewing your extension will be tied in with proof of filing taxes. Nothing good will come of this to retirees.

It is the paperwork nightmare that will be worse than the tax, and as you say likely to be enforced as a condition of visa extension.

 

All problems will be our problems.

[atpeace]

Just when the old threads were getting boring!  My last post on the part 2 thread was I can only hope someone will post another ambiguous tax article so everybody will lose their shttt. It has happened 🙂  BTW, do you guys know most countries expats here come from  have taxes on global income for residents.  

 

So when is everybody leaving? Yawn but then again this is SUPER entertaining.

[Dogmatix]

2 hours ago, bkk6060 said:

A person would have to be clueless to not realize many people move here to meet younger women.  

The value to me is worth me staying here and paying some tax to enjoy what this country offers.

But, I guess Gottfrid if one does not like women they would not understand the value.  So glad that is not me.

 

Many mongers may move to meet younger women in the Philippines to avoid all this hassle and expense.

[Celsius]

I was watching some young Aussie guy on YouTube renting a condo in Kuala Lumpur with a nice downtown view for around 20,000 baht a month. 2 bed 2 bath condo with nice facilities that would cost around 90,000 baht in Bangkok to rent. I really love Malaysian food quality over the served Thai slop and every time I went there everything was cheaper than here.

 

I am considering this or back to Canada. Wifey is already looking for some jobs in Malaysia related to her field.

[retarius]

I'm a 179 dayer. A mate of mine that hates paying taxes and who pays no taxes at all, tells me I'm stupid, and that Thais cannot possibly tax income from abroad because they are too stupid. He's taking zero precautions. I just smiled. 

Better safe that sorry I say. I'm also 179 dayer this year, because I don't wish to file a tax return for 2024 taxes even though all the remittances made were from savings. For those that file a tax return this year, you do realise you are giving all of your details to the tax people here, which I think means they can question your taxes any time they wish to in the future.

I feel rather safe than sorry should be the policy here.  

[KhunLA]

Guess it pays to poor & liquid.   Reckon they'll honor the DTAs, so leaves only my company pension, a pittance, and goes to my brokerage account, which I'm not sure they'll have access to, and only $4284 a year @ $1 / ฿33 = ฿141,372, leaves -0- taxable after allowances  

 

One visit to a hospital in USA would negate 20 years of any 'tax savings' for a Yank, if I lived that much longer   

 

The couple procedures I've had done here cost less than the 4 years or Medicare Plan B premiums, ~$8,000 I would have paid already   Matter fact, make that all my medical expenses I've had the past 24 years of being here, cost <$8,000 

[CallumWK]

1 hour ago, jumbo said:

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.

 

I come from a country that has a DTA with Thailand.

My embassy emailed everyone registered that if the tax rate in Thailand is higher than the tax rate applied in my home country, that you will need to pay the difference.
They didn't say that if the Thai tax rate was lower, I would get a partial refund 😅

[Celsius]

1 hour ago, redwood1 said:

 

Good idea.....Tax all those dirty farang condo owners until they are living on the street....While at the same time keep telling the world Thailands the hub for retirement.......lol........

 

Exactly. Tax the stupid.

[KhunLA]

1 hour ago, redwood1 said:

Good idea.....Tax all those dirty farang condo owners until they are living on the street....While at the same time keep telling the world Thailands the hub for retirement.......lol........

If I 45 years old again, and was looking for a place to retire in 2025, it certainly wouldn't be Thailand.

[jaideedave]

56 minutes ago, anchadian said:

All my income is sent directly to my Thai wife's bank account and I withdraw our living expenses each month and the balance of monies remaining is left in her account.

 

I have no other family members when I pass.

I'm thinking along the same lines as you. I qualify for the monthly income test. I'll send half to my account and half to Madams account. 450K each shouldn't attract much tax.

[Etaoin Shrdlu]

1 hour ago, biervoormij said:

The US DTA does not cover IRA or 401K distributions so not exempt like social security or government pensions. I don't know how the Thailand RD will deal with this but saying it is exempt is not correct. I think if you are taking large 401K distributions you will have to pay the much higher Thailand tax rate.

i think a TRD official discussed this in a presentation to one of the chambers of commerce. The position was that IRA and 401k plans are considered self-directed pensions and distributions would be taxed as regular pension income under Thai tax laws.

[sandyf]

4 hours ago, Rampant Rabbit said:

omitted from the OP

 

If and when it is enacted

There was a quite a lot ommitted from the OP.

This article appeared on my phone a couple of days ago and the OP appears to be a redacted version.

https://www.bangkokpost.com/business/general/2860812/law-to-tax-income-from-overseas-in-the-works#:~:text=The Thai Revenue Department is,director-general of the department.

[gearbox]

6 hours ago, JimHuaHin said:

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.

 

 

The information the Thais need will be served to them on a plate from your country as part of the CRS data exchange...as long as you admit in your country you are a Thai tax resident.

[sandyf]

2 hours ago, connda said:

I know one thing for sure.  Every year when I submit my extension based on marriage, right their in bold letters it says that I'm only "Visiting my Thai wife."   So much for "permanent." 

Permanent Residency is something completely different to visa status extension. Nothing to stop you pursuing that option.

[FruitPudding]

5 hours 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.

 

I dunno where you are from, but where I come from tax and social security are two different payments. They are not the same thing.

 

Generally, to get social security you have to be working, not merely paying tax on capital gains or foreign income.

 

That said, I despise taxation in general and socialism is inherently evil, IMHO