Thailand issues four major announcements on new visa measures

[LOG54]

19 minutes ago, gejohesch said:

"They can also ask to file a tax return, calculate the Thai tax amount and deduct what you pay abroad"

Sure, they can ask for a tax return, that would be expected. But if you are citizen of a country that has a bi-lateral agreement with Thailand, and that agreement covers taxation (it would normally do), then Thailand just has to abide by the letter of that agreement, if not Thailand has a dispute not just with you, but with the government of the country of which you are a citizen. Period. Now, such agreements come in various forms and shades and you would have to check what your own situation is. Myself, I know exactly the following (Iwas resident and had been employed in Thailand for a few years, some time ago) : whatever income I get sourced in my home country is taxable in my home country + whatever income I get sourced in Thailand is taxable in Thailand. I went through a number of yearly exercices, so I know. Now, if I become resident in Thailand again and if Thailand want to tax me on whatever income I receive in my home country, Thaianld will pick up a fight with my home country because that would be simply illegal.

 

Years ago, I checked what my tax situation would be if I became resident in India - sthg I contemplated for a while. There is a bi-lateral agreement between my home country and India, and it stipulates that if I'm resident in India, my pension income (sourced in my home country) becomes taxable in India and not in my home country.

 

I write this at length and I'm aware of some repeats, but I wanted to make it clear : Thailand cannot do whatever they like to do wrt taxing citizens of countries with which Thailand has a bi-lateral agreement. Again, and for the last time : check if there is a bi-lateral agreement between your country and Thailand, check what it says wrt taxation, and in case of doubt consult your country diplomatic representation in Thailand, consulate or whatever.

Hello

For your info there has been meetings with some embassies, representatives of TRD and expats in Bgk.. For sure one with swiss embassy.. one with french embassy..

Already it came out that the Thai version of the Thai french agreement and the french/English version has one very important word which were different (something like should on one side and could on the other one) and the TRD representative said for them the Thai version is the valid one..

The french authorities have required TRD to clarify their position.. no answer till date..

Again, if Thailand proceeds and enforces the law, it will take months/years to reach a settlement with the other country..

And again, now there are numerous countries with no double taxation agreements where residents still are charged especially by a lump sum on imported money or required to pay the difference between their taxes abroad and in their country of residence.

Have an excellent day

[NoDisplayName]

12 hours ago, Chadnik said:

All they need to do is filter through immigration. If you're on a visa extension you front up with a tax return and that's pre-checked before you visit the immigration officer in the larger offices. Simples

 

That's not how it's going to work.

 

Bring tax returns to immigration?  Too complicated.  IO will ask for a Tax Clearance Certificate provided by TRD.  These are available at no cost from your local office, valid for 15 days.

 

But that's not how it's going to work.

 

Nice little pocket money earner for the TRD office folks.  Will they charge as much as immigration does for the Residence Certificates they provide at no charge?

 

I suspect we'll all be folding in another 200-300 baht handling fee into the cost of annual extensions.

[gejohesch]

26 minutes ago, LOG54 said:

Hello

For your info there has been meetings with some embassies, representatives of TRD and expats in Bgk.. For sure one with swiss embassy.. one with french embassy..

Already it came out that the Thai version of the Thai french agreement and the french/English version has one very important word which were different (something like should on one side and could on the other one) and the TRD representative said for them the Thai version is the valid one..

The french authorities have required TRD to clarify their position.. no answer till date..

Again, if Thailand proceeds and enforces the law, it will take months/years to reach a settlement with the other country..

And again, now there are numerous countries with no double taxation agreements where residents still are charged especially by a lump sum on imported money or required to pay the difference between their taxes abroad and in their country of residence.

Have an excellent day

Yes, that sounds absolutely correct. For info, Thailand has currently 61 double-tax agreements, check the link here : Double Tax Agreements in Thailand, What you need to know. (belaws.com)

 

Thailand may have the ambition to do what they like, but of there is a bilateral agreement between Country X and Thailand covering taxation, that sets the rules between Thailand and  country X. Thailand cannot unilaterally change the rules. Renegotiation of up to 61 existing agreements look like a himalayan task to me, especially knowing that usually it would take years (rather than months) to renegotiate. Good luck with that!

[jojothai]

4 hours ago, Johno57 said:

If you rent out your condo you have to pay tax on the rental income or get charged double tax for avoidance..

Yes, However if you buy one and are living in it until you sell it then that does not become a concern.
If you buy more and have two or more condos then its truly a consideration, and as you have pointed out it will affect your situation.

[LOG54]

11 minutes ago, jojothai said:

Yes, However if you buy one and are living in it until you sell it then that does not become a concern.
If you buy more and have two or more condos then its truly a consideration, and as you have pointed out it will affect your situation.

Yes.. we rent a condo from a foreigner and in our condominium there are numerous thais or foreigners renting out condos even on airbnb.. nobody declares anything..

This however would be quite easy to check for the RD if they cooperate with immigration office (at least for long term contracts) as we have to produce the lease agreement for extension of stay .. which includes all details about owner including passport copy !!

Have a good day

[proton]

On 9/16/2024 at 5:12 AM, hotchilli said:

The world wide income tax will never happen.

 

I will just tell them I have no income and no bank account at home and live off my wife who is a popular Bangkok prostitute (she's not)

[Rolo89]

1 hour ago, gejohesch said:

Thailand may have the ambition to do what they like, but of there is a bilateral agreement between Country X and Thailand covering taxation, that sets the rules between Thailand and  country X. Thailand cannot unilaterally change the rules. Renegotiation of up to 61 existing agreements look like a himalayan task to me, especially knowing that usually it would take years (rather than months) to renegotiate. Good luck with that!

You can have the tax in thailand offset by what you pay where it was generated with a bilateral agreement but they could potentially charge the difference in extra. So yes you're not taxed twice, you're only charged in Thailand the difference if tax is lower in the other country.

[LOG54]

4 hours ago, proton said:

 

I will just tell them I have no income and no bank account at home and live off my wife who is a popular Bangkok prostitute (she's not)

Not possible..Thailand is a family destination and whenever they investigate in Pattaya, they never find any..😜

[LOG54]

3 hours ago, Rolo89 said:

You can have the tax in thailand offset by what you pay where it was generated with a bilateral agreement but they could potentially charge the difference in extra. So yes you're not taxed twice, you're only charged in Thailand the difference if tax is lower in the other country.

It has been said and repeated numerous times but a lot of people don't understand these rules and think they are OK if they pay in their home country (if double agreement says pensions and/or rents from properties are taxed in the country where this income is generated)..

Another issue in France we have on the same document issued yearly by the tax department) the tax amount to pay and underneath what everyone considers as tax but is calculated separately and is a flat tax on incomes (little less than 20%) It is called social contributions... I doubt Thailand will consider it as tax and that would still make a huge difference (in my case this "contribution" is 4 times higher than my tax...)

Have a good day

[Umlungu]

Add to all this nonsense the umpteenth re-introduction of the 300 baht tourism tax. What a joke it all  is.

[Mayhem11]

Taxing retirement ıncome  means we will never go back to Thailand for an extended stay again.

[jacob29]

11 hours ago, gejohesch said:

Years ago, I checked what my tax situation would be if I became resident in India - sthg I contemplated for a while. There is a bi-lateral agreement between my home country and India, and it stipulates that if I'm resident in India, my pension income (sourced in my home country) becomes taxable in India and not in my home country.

This sounds like a pretty rare type of agreement though, and I would wager doesn't apply to the vast majority of people. Usually it ends up being taxed at higher of the two. It also means this source country can become a tax haven through which Thai people wash their funds, which could put it on borrowed time (likely depends on how many people take advantage of it).

[jacob29]

4 hours ago, LOG54 said:

I doubt Thailand will consider it as tax and that would still make a huge difference (in my case this "contribution" is 4 times higher than my tax...)

Have a good day

As capital losses are not deductible, my tax obligation would far exceed my net income 😂. Literally no choice but to make sure I don't become a tax resident, unless I radically changed my investing behaviour.

 

I cannot understand how anyone can trade stocks when capital losses aren't deductible, you are very likely to face losses even when your portfolio is in net profit.

[jojothai]

I just found the Thai summary of their CRS guidance. Not seen it before.
See attachment.
Its a pdf and 67 pages so i cannot attach.
Go to
https://www.rd.go.th/fileadmin/user_upload/FATCA_File/crs/Thailand_CRS_Guidance_280823.pdf

I have also checked now how many agreements that Thailand has already got in place for exchange of Information with other countries,

and it is substantial. Bad news, Much quicker than I had thought. 
Go to
https://web-archive.oecd.org/tax/automatic-exchange/international-framework-for-the-crs/exchange-relationships/index.htm

and choose Thailand.
For the people asking how the Thais will get the information for global income, then this indicates that the Thais have done what they need to get the exchange of information from many financial institutions overseas.

 

Perhaps I should put this on a new post. Will do.

Edited September 17 by jojothai
add text

[LOG54]

58 minutes ago, jacob29 said:

This sounds like a pretty rare type of agreement though, and I would wager doesn't apply to the vast majority of people. Usually it ends up being taxed at higher of the two. It also means this source country can become a tax haven through which Thai people wash their funds, which could put it on borrowed time (likely depends on how many people take advantage of it).

If you check the same rule apply for french residing in Greece..French pensions are taxed in Greece.. Came to know when looking for a country to go if leaving Thailand.. and it was a big surprise 

 

[gejohesch]

10 hours ago, Rolo89 said:

You can have the tax in thailand offset by what you pay where it was generated with a bilateral agreement but they could potentially charge the difference in extra. So yes you're not taxed twice, you're only charged in Thailand the difference if tax is lower in the other country.

If the agreement states simply "income abroad is taxed abroad; income in Thailand is taxed in Thailand", that is not correct. There are indeed agreements that include an offset mechanism, but then that must be explicitly stated. 

[tmax]

Imagine if you bought the Elite visa at the beginning of 2024

 

TIT

[gejohesch]

1 hour ago, jacob29 said:

This sounds like a pretty rare type of agreement though, and I would wager doesn't apply to the vast majority of people. Usually it ends up being taxed at higher of the two. It also means this source country can become a tax haven through which Thai people wash their funds, which could put it on borrowed time (likely depends on how many people take advantage of it).

"There is a bi-lateral agreement between my home country and India, and it stipulates that if I'm resident in India, my pension income (sourced in my home country) becomes taxable in India and not in my home country."

 

I don't think it's that rare. It would be similar if I was resident in Portugal (past the 10 years "Residente Não Habitual" period), as my pension is from the private sector, paid in my home country, it would become entirely taxable in Portugal.

 

The point here is do not think that your own case is going to be the norm for citizens of other countries. Each one has to do his / her home work and check what a bilateral agreement with Thailand exactly says.

[NoDisplayName]

2 hours ago, jacob29 said:

I cannot understand how anyone can trade stocks when capital losses aren't deductible, you are very likely to face losses even when your portfolio is in net profit.

 

You could understand it in Thailand, as GAINS on sales of Thai stocks/funds are not taxed.

[Rolo89]

8 minutes ago, NoDisplayName said:

 

You could understand it in Thailand, as GAINS on sales of Thai stocks/funds are not taxed.

Sounds like they're going to need to change a lot of things before they can think about taxing worldwide income

[NoDisplayName]

1 minute ago, Rolo89 said:

Sounds like they're going to need to change a lot of things before they can think about taxing worldwide income

 

Why?  There is a special 0% tax rate on Thai stocks and Thai mutual funds.  Nothing discriminatory, everyone follows the same rules.

 

Thais with overseas stocks/funds now pay tax on gains without allowance for offsetting losses.  I expect we'll get the same deal, capital gains being taxed as ordinary income unless capped by DTA.

 

Tax-resident expats would have been taxed the same previously if the income was brought in same year earned.

[Rolo89]

3 minutes ago, NoDisplayName said:

Thais with overseas stocks/funds now pay tax on gains without allowance for offsetting losses.

Not allowing losses to offset gains on worldwide assets makes it very unworkable.

[NoDisplayName]

Just now, Rolo89 said:

Not allowing losses to offset gains on worldwide assets makes it very unworkable.

 

How it that unworkable?  That's how the system operates here now.  We already fall under this, but up until now we've been able to 'season' the funds until the next year for remittance, or the tax officer would accept our claim (if we bothered to file) that funds brought in were savings.

 

It could be workable by requiring a copy of home country tax return if audited.  That would have all the taxing info needed.

 

I'm not sayin' I agree with it, as I'd be hit with a $10,000 bill if worldwide taxation goes through.  In that case it would be extremely workable, in other words, bug out!

[jacob29]

2 hours ago, gejohesch said:

I don't think it's that rare. It would be similar if I was resident in Portugal (past the 10 years "Residente Não Habitual" period), as my pension is from the private sector, paid in my home country, it would become entirely taxable in Portugal.

Are you talking specifically pensions, or income in general? There's a big difference, pensions can't be readily abused for tax evasion. Washing money through a tax haven can.

[jacob29]

2 hours ago, NoDisplayName said:

 

You could understand it in Thailand, as GAINS on sales of Thai stocks/funds are not taxed.

Good luck achieving gains on the local market, have you seen the historical performance of SET100? Not even sure it has outperformed inflation on the 20 year, and sure dividends help, but it's not appealing to put it mildly.

 

Take some of the major banks for example, monopoly on the market with their 200thb ATM fees - yet barely up since 2007. There has got to be corruption in the mix, makes no sense.

[jacob29]

2 hours ago, NoDisplayName said:

 

How it that unworkable?  That's how the system operates here now. 

By not workable, I believe they mean not workable for a certain class investors that have high turnover as part of their investment strategy. Having an effective tax rate exceeding 100% is not workable. Imagine you hold two stock options expiring a year out, one goes up 100% while the other craters to zero. You now have a tax bill for 30% on that 100% gain (or whatever your bracket is), on a net gain of $0. 

Edited September 17 by jacob29

[gejohesch]

10 hours ago, jacob29 said:

Are you talking specifically pensions, or income in general? There's a big difference, pensions can't be readily abused for tax evasion. Washing money through a tax haven can.

Me : “I don't think it's that rare. It would be similar if I was resident in Portugal (past the 10 years "Residente Não Habitual" period), as my pension is from the private sector, paid in my home country, it would become entirely taxable in Portugal.”

 

You: “Are you talking specifically pensions, or income in general? There's a big difference, pensions can't be readily abused for tax evasion. Washing money through a tax haven can.”

 

In the example I was giving (if being “resident non habitual” in Portugal), I was focusing on pension as it's now my only income. The DTA (double tax agreement) between Portugal and my home country specifies that pensions from the private sector will be declared and taxed in Portugal, whereas pensions from the public sector (eg gvt administration, army, civil service and so on) remain to be declared and taxed in my home country.

Btw, the DTA applies to whoever receives an income in/from my home country, regardless of his / her nationality. That’s an important point, often ignored, that could be found generally in many other DTA’s. Let’s make it clear with one example : imagine a citizen from Peru having worked in my home country and being now resident in Portugal. As that Peruvian person would receive a pension from my home country, the DTA between my home country and Portugal would apply. Possibly, the DTA between Peru and Portugal would also have to be checked (if there is one).

It all depends (again) on how DTA’s are written. Everyone should do his / her homework and check what applies to his / her situation. There could be all sorts of bells and whistles in a DTA!

I cannot comment on how pensions can be abused for tax evasion. I have no idea about that!

[gejohesch]

10 hours ago, jacob29 said:

Are you talking specifically pensions, or income in general? There's a big difference, pensions can't be readily abused for tax evasion. Washing money through a tax haven can.

I think I get your point re. pensions and tax evasion. It would probably be easy for (say) a Thai person having worked in (say) Germany) and receiving a pension there to not declare it to the Thai finances. Is that what you mean?

One would then have to be sure that there is poor/insufficient communication between German and Thailand authorities!

[jacob29]

2 hours ago, gejohesch said:

Let’s make it clear with one example : imagine a citizen from Peru having worked in my home country and being now resident in Portugal. As that Peruvian person would receive a pension from my home country, the DTA between my home country and Portugal would apply. Possibly, the DTA between Peru and Portugal would also have to be checked (if there is one).

Fair enough (that it's specific to pensions), what had confused me was the earlier phrase 'whatever income I get sourced in my home country is taxable in my home country '. Which made it sound like to applied to general income.

 

Someone with income to minimize tax on (especially a high income earner), can't go establish a pension with massive distributions as way to avoid tax. Which is probably why they have more permissive conditions.

[NoDisplayName]

16 hours ago, jacob29 said:

Good luck achieving gains on the local market, have you seen the historical performance of SET100? Not even sure it has outperformed inflation on the 20 year, and sure dividends help, but it's not appealing to put it mildly.

 

Take some of the major banks for example, monopoly on the market with their 200thb ATM fees - yet barely up since 2007. There has got to be corruption in the mix, makes no sense.

 

Well, of course!  The law is set up for the major shareholders who can manipulate the market - and then pocket their ill-gotten booty tax-free.