Thai gov. to tax (remitted) income from abroad for tax residents starting 2024 - Part II

[gamb00ler]

1 hour ago, Danderman123 said:

But 99% of Farangs are not in the RD system, and those are the people this topic about.

I would guess that any farang who received interest from a Thai bank would already be in the RD system.  Doesn't that sound reasonable?

[andre47]

2 hours ago, chiang mai said:

Yes it is, Por 162 says it is so:

 

https://sherrings.com/foreign-source-income-personal-tax-thailand.html

No, it doesn't....

Here the Por 162 translation
https://www.expattaxes.com.au/wp-content/uploads/2023/11/Revenue-Department-Order-No-P162A-2023.pdf
 

“The provisions of paragraph one shall not apply to assessable income arising before 1 January 2024.”

It just says that the new regulation does not apply to assessable income arising before 1 January 2024.

It does not say that the old tax regulations are void.

[stat]

2 hours ago, Danderman123 said:

The specific case you are referring to is a Farang who worked in Thailand, paid taxes, and then stopped filing returns after retirement. The Revenue Dept noticed the failure to file a return, and took action.

 

The lesson here is that, once you are in the RD system, they can require you to file a return.

 

But 99% of Farangs are not in the RD system, and those are the people this topic about.

However it could happen that every farang needs to file in 2024 et voila nearly all farangs who are tax resident are in the RD system. I never understood the scaremongering issue/debate myself. It all depends on the perspective so let each one decide for themself which risk they do want to take.

 

Some people do boom boom in Soi 6 without protection and deem it ok and consider it only a minor risk 🙃

[stat]

1 hour ago, andre47 said:

No, it doesn't....

Here the Por 162 translation
https://www.expattaxes.com.au/wp-content/uploads/2023/11/Revenue-Department-Order-No-P162A-2023.pdf
 

“The provisions of paragraph one shall not apply to assessable income arising before 1 January 2024.”

It just says that the new regulation does not apply to assessable income arising before 1 January 2024.

It does not say that the old tax regulations are void.

And beforehand income was only assesable if transfered in the same year. So in effect income from before 2024 is tax emempt from thai PIT IMHO.

[sometimewoodworker]

1 hour ago, andre47 said:

No, it doesn't....

Here the Por 162 translation
https://www.expattaxes.com.au/wp-content/uploads/2023/11/Revenue-Department-Order-No-P162A-2023.pdf
 

“The provisions of paragraph one shall not apply to assessable income arising before 1 January 2024.”

It just says that the new regulation does not apply to assessable income arising before 1 January 2024.

It does not say that the old tax regulations are void.

You really don’t seem to understand the change and it is very very small.

No regulations were void and only you seem to say they were.

 

Por 161 eliminated the time limit (1 year) on assess-ability of overseas income remitted to Thailand (the earned in the previous year being tax free)

Por 162 grandfathered the pre 1/1/2014 situation so that no income gained before 2024 became taxable that Por 161 would otherwise have made taxable 

 

So Por 162 did not void anything it just limited the change in Por 161 to post 1/1/2024

And Por 161 did not void anything it just eliminated the time limit on assessable income.

Those are the ONLY changes made and as you can see they are very small.

 

Now the effects of those small (mostly Por 161) changes are quite big and the implications extensive but that is a totally different can of worms.

[andre47]

22 minutes ago, sometimewoodworker said:

Por 162 grandfathered the pre 1/1/2014 situation so that no income gained before 2024 became taxable that Por 161 would otherwise have made taxable 

agree, Por 162 refers only to Por 161 and has no effect on the regulations that existed before 1.1.2024

 

[Celsius]

1 hour ago, stat said:

et voila nearly all farangs who are tax resident are in the RD system.

 

Wow, how interesting.

 

So, only white people need to file taxes in Thailand? Chinese, Arabs, Indians, of course don't need to worry.

 

There, you said it yourself.

 

 

[chiang mai]

3 hours ago, andre47 said:

No, it doesn't....

Here the Por 162 translation
https://www.expattaxes.com.au/wp-content/uploads/2023/11/Revenue-Department-Order-No-P162A-2023.pdf
 

“The provisions of paragraph one shall not apply to assessable income arising before 1 January 2024.”

It just says that the new regulation does not apply to assessable income arising before 1 January 2024.

It does not say that the old tax regulations are void.

Well in that case, it must be that you are right and everyone else is wrong, including PWC, Sherrings and Mazars! 

[KhunHeineken]

3 hours ago, gamb00ler said:

I would guess that any farang who received interest from a Thai bank would already be in the RD system.  Doesn't that sound reasonable?

I agree. 

 

Thai banks have to record such data. 

 

What has changed is the need for foreigners to report this, as an individual.  That's not to say they have a tax liability, but they have "earned" some money in Thailand, thus, are now in "the game." 

[Lorry]

6 hours ago, gamb00ler said:

I would guess that any farang who received interest from a Thai bank would already be in the RD system.  Doesn't that sound reasonable?

Sounds reasonable,  but it's not the case. 

[Lorry]

2 hours ago, KhunHeineken said:

What has changed is the need for foreigners to report this

There is generally no need for foreigners to report interest they received from Thai banks to the TRD. 

 

 

[Danderman123]

6 hours ago, chiang mai said:

It's not that difficult to imagine that scenario in any country. TRD sees (via BOT) banking transactions  of a decent size and frequency coming in from overseas and notes there is no corresponding tax return to account for them, those two checks are hardly rocket science.  It may be the bank account pays decent interest and the holder also pays tax which he doesn't try to reclaim....why is that they ask themselves. I know, let's ask Immi if this guy has a long stay visa....he does they say.....and so on and so on.

This is a country that doesn't enforce motorcycle helmet laws. I could write a post about how they *could* easily enforce the laws, but they don't.

 

Your observation is true, in theory, but Thailand is a country where theory rarely becomes practice.

[Danderman123]

6 hours ago, gamb00ler said:

I would guess that any farang who received interest from a Thai bank would already be in the RD system.  Doesn't that sound reasonable?

There is a 20,000 baht minimum for such bank interest to be taxable.

 

That implies a bank account in the millions before any tax on interest is applicable.

[ukrules]

9 hours ago, chiang mai said:

The issue in this matter is whether or not foreigners would be prevented from leaving the country, if the TRD had them under investigation or thought they may owe tax. The answer is very clearly that they would.

 

The irony here being that this might force someone into becoming a tax resident during a year when they planned to be non resident.

 

[motdaeng]

2 hours ago, Danderman123 said:

This is a country that doesn't enforce motorcycle helmet laws. I could write a post about how they *could* easily enforce the laws, but they don't.

 

Your observation is true, in theory, but Thailand is a country where theory rarely becomes practice.

agree, but sometimes a rare thing can become more likely, even in thailand. for example, enforcement of speeding tickets or tm30 regulations.

 

some foreigners prefer to follow the rules or laws, even if it's inconvenient or costly. it's your choice.

[chiang mai]

2 hours ago, Danderman123 said:

This is a country that doesn't enforce motorcycle helmet laws. I could write a post about how they *could* easily enforce the laws, but they don't.

 

Your observation is true, in theory, but Thailand is a country where theory rarely becomes practice.

The two main factors that determine whether something that should be done, does get done, include the effort required and the financial reward. Chasing teenagers on motorbikes in  the hot sun, in order to fine them 300 baht for not wearing a helmet, doesn't compare to sitting behind a desk in an airconditioned office, looking at a computer printout of bank deposits by customer, supplied by BOT  and then picking up a telephone and calling that person or an investigator to initiate an audit that could result in fines of tens of thousands of baht.

[chiang mai]

2 hours ago, Lorry said:

There is generally no need for foreigners to report interest they received from Thai banks to the TRD. 

 

 

Very true, TRD knows how much interest you earned before you do!

[chiang mai]

2 hours ago, Danderman123 said:

There is a 20,000 baht minimum for such bank interest to be taxable.

 

That implies a bank account in the millions before any tax on interest is applicable.

Not true. Banks are required to withhold tax on all interest that is paid, unless the customer supplies a copy of their TIN.

[bkk6060]

If they are going to track people down start with the Chinese and Russians because no way any of them will file taxes.

[chiang mai]

7 hours ago, andre47 said:

 

I think you're having an interpretation problem, you wont find the explicit set of words you're looking for but the effect of Por 162 delivers exactly the same benefit.

[andre47]

8 hours ago, chiang mai said:

Well in that case, it must be that you are right and everyone else is wrong, including PWC, Sherrings and Mazars! 

I don't say it...it is very clear written in Por 162 (if you can read)

[chiang mai]

4 minutes ago, andre47 said:

I don't say it...it is very clear written in Por 162 (if you can read)

At least three posters have tried to correct your understanding of this, if you insist you are still right then feel free. The downside of course is that your interpretation will mean paying tax on income where no tax is due, if you're OK with that, have at it.

[andre47]

7 minutes ago, chiang mai said:

At least three posters have tried to correct your understanding of this, if you insist you are still right then feel free. The downside of course is that your interpretation will mean paying tax on income where no tax is due, if you're OK with that, have at it.

You are interpreting, I am reading:
 

“The provisions of paragraph one shall not apply to assessable income arising before 1 January 2024.”
"of paragraph one shall not apply" (from Por 161)
 

This Por 162 does not change anything what was/is applicable law before 1.1.2024.

 

[chiang mai]

3 minutes ago, andre47 said:

You are interpreting, I am reading:
 

“The provisions of paragraph one shall not apply to assessable income arising before 1 January 2024.”
"of paragraph one shall not apply" (from Por 161)
 

This Por 162 does not change anything what was/is applicable law before 1.1.2024.

 

I'm not going to argue with you andre, if you want to have it your way then fine. You will however note that since we are now post 1 January 2024, NO income earned before that date can be remitted in the same year that it was earned.

 

Order No. Por.162/2566, issued on November 20, 2023, provides further clarification. It states that the new interpretation should not apply to foreign-sourced income earned before January 1, 2024. This means that income derived prior to this date will be subject to the previous rule: it will only be taxed if brought into Thailand within the same tax year it was earned. This order aims to ease the transition for taxpayers planning the remittance of previously earned foreign income.

 

https://mahanakornpartners.com/comprehensive-overview-of-order-no-por-161-2566-and-no-por-162-2566-on-personal-income-tax-for-foreign-sourced-income/

[andre47]

28 minutes ago, chiang mai said:

This means that income derived prior to this date will be subject to the previous rule: it will only be taxed if brought into Thailand within the same tax year it was earned.

Maybe I just misunderstood you.

This is exactly what I meant.

[gamb00ler]

12 hours ago, gamb00ler said:

I would guess that any farang who received interest from a Thai bank would already be in the RD system.  Doesn't that sound reasonable?

 

6 hours ago, Lorry said:

Sounds reasonable,  but it's not the case. 

It is very likely that the Thai banks send the TRD the amount of any interest paid out along with the information identifying the recipient.  The reasoning I used is that since anyone can file a Thai tax form to get the withholding returned(if overpaid), the TRD would be able to verify that the tax filing is correct using data from the banks.

 

You seem pretty sure that the Thai banks don't send such information to TRD.  What is the basis of your opinion?

[motdaeng]

2 hours ago, gamb00ler said:

 

It is very likely that the Thai banks send the TRD the amount of any interest paid out along with the information identifying the recipient.  The reasoning I used is that since anyone can file a Thai tax form to get the withholding returned(if overpaid), the TRD would be able to verify that the tax filing is correct using data from the banks.

 

You seem pretty sure that the Thai banks don't send such information to TRD.  What is the basis of your opinion?

 

my wife goes to the tax office every year with all our bank statements, including receipts from investments, government funds, etc. normally, the staff enter all the data into the system. however, this year, the employee asked my wife about the amount we calculated by ourself. since the difference from the system was only a few baht, the employee decided not to enter all the data into the computer! 

 

conclusion: banks are sending data directly to the TRD! i've had a TIN for over 10 years and have been filing tax returns every year... without any issue ...

[Lorry]

3 hours ago, gamb00ler said:

You seem pretty sure that the Thai banks don't send such information to TRD

I didn't say that. 

They do send.

But that doesn't mean the resp. foreigner "is in the RD system", whatever that may mean.

[chiang mai]

3 hours ago, gamb00ler said:

 

It is very likely that the Thai banks send the TRD the amount of any interest paid out along with the information identifying the recipient.  The reasoning I used is that since anyone can file a Thai tax form to get the withholding returned(if overpaid), the TRD would be able to verify that the tax filing is correct using data from the banks.

 

You seem pretty sure that the Thai banks don't send such information to TRD.  What is the basis of your opinion?

It is a fact that the banks do send that information to TRD. I only need to enter one of my bank account numbers into the TRD system and the tax and interest data from ALL my accounts appears on the screen as part of my tax records.

[gamb00ler]

1 hour ago, Lorry said:

I didn't say that. 

They do send.

But that doesn't mean the resp. foreigner "is in the RD system", whatever that may mean.

You are entitled to your own definition of English words.  Just don't expect to be understood.