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

[chiang mai]

For the benefit of those aged 50+.

 

I did a lot of my tax planning over twenty years ago, just before I moved to Thailand and whilst I was still earning income from work. Looking back, three of the things I got right were firstly, to bring over a large amount of money and invest in THB when exchange and interest rates were much better. Funds I exchanged at 70+ baht per Pound have now nearly doubled in value so this was an excellent move, if you can overcome your fear of Thai banks etc. If anyone wanted to trawl back through my mid year 2000 posts you can see where I proposed this as a good idea, whilst most other members were horrified or laughing and thought I was nuts! I remain Baht positive for the medium and longer term so this is still a viable proportion, I think. The tax aspect here is that it put my savings outside the UK where I was no longer tax resident. 

 

The second thing I got right was to buy our home and not rent accomodation, that's a strategy that has more than paid for itself already, even if I lose everything tomorrow. But to do this, you need to overcome your fear of the property market and ownership here. This move freed up income to divert to number three below. It also put the house into my wife's name , which helps with UK Inheritance Tax.

 

The third thing is that I funded my wifes business, which has produced a very healthy tax efficient revenue stream that will continue long after I am gone. This has meant I have not had to fund my wife or her family expenses for over a decade and that I can focus on other things. Once again, to do this you need to overcome some fears. From a tax perspective, my wife and I have separate financial affairs which means she can earn the same income as me every year and also not pay tax.

 

The last thing was that  I used my UK SIPP for my investments, in previous year I have opened two more. This has meant I have been able to grow significant amounts that remain tax free (currently) and are very tax efficient. Since I don't drawdown those SIPP's, my exposure to IHT is minimised. Eventually those funds will be transferred to my wife under inheritance tax rules which are also tax efficient.

 

The common theme here is to a) overcome your fear of incorporating Thailand  into your financial planning and not remain financially isolated overseas, and b) act early with a view to the longer term and what your future position will be in 10, 15 or 20 years hence. 

 

 

[stat]

12 hours ago, chiang mai said:

You seem to think that the Thai tax issues affect only wealthy individuals and ignore the vulnerable, average and aged expat pensioner retiree who has no experience of managing or filing tax returns. My interest lies in trying to help the average and below average member, many of whom are deeply scared and confused by all things foreign tax related. My past tax, finance and Big 4 work experience, combined with the fact I have lived in Thailand full time for over 20 years, may be of help to some of that group. Those things are why I mostly ignore the never ending debates about CRS and foreign DTA's.

 

I have no interest in the tax affairs of people like you and others who talk in terms of buying 1,000 Apple and being concerned at the tax implications when you sell, or the large dividend payments given to you by your parents. If you can afford to buy 1,000 Apple you can also afford to put your hand in your pocket  and spend 20k at Ernst and Young and get the best Thai tax advice that money can buy. So exactly why you even bother to log onto this thread, especially given that you live full time over 8,500 kms away. is extraordinary, to say the least!

 

If there are members of AN who risk millions in tax as a result of CRS, they must be some of the cheapest rich people on the planet, in order to have such wealth yet seek tax advice from a social networking forum! I am personally aware of at least two  AN members who talked in terms of self harm and required support and intervention, such was their fear of what might happen to their paltry income in retirement here as a result of the tax changes. Meanwhile,  you talk about the millions at risk overseas by wealthy expat, dear Lord, we're not even on the same planet, let alone the same subject.

 

I will be very happy if you wish to add me to your ignore list, that way my contributions won't interfere with your enjoyment.

You really seem to care more about me then I care about you 🙂

 

I simply answered your question why some people are concerned about thai tax changes it is because they could lose a lot of money. Why you care remains a mystery to me as most of your funds will already be taxed (rental income, pensions etc) somewhere else so Th taxes do not make any difference.

 

Why do you feel the need to insult people who have more money then yourself? What would you think of me if I insulted you about not having any investment income? Bad style my friend.

 

 

"So exactly why you even bother to log onto this thread, especially given that you live full time over 8,500 kms away. is extraordinary, to say the least!"

 

Also you wrote" did a lot of my tax planning over twenty years ago, just before I moved to Thailand and whilst I was still earning income from work."

 

The decission where I move next is important to me and a lot of my clients. Only a complete fool would move to another country without following closely the changes in tax law BEFORE they moved. Can you understand this?

[Captain Flack]

A reported post has been removed, for discussing allegations about another member. Can we please discuss the topic.

 

Reminder of forum rule  31. You will not publicly discuss other members or post any member's personal information 

[chiang mai]

Not especially informative but a couple of tidbits in there that may give some clues.

 

 

And a second one that I've not seen before, from Siam Legal dated a month ago, a few interesting points in there, not least of which being when foreigners need to file a tax return. The relevant slide starts, "A Foreigner shall file a tax return if: Bear in mind, this is from Siam Legal.

 

 

[Lorry]

5 hours ago, chiang mai said:

Not especially informative but a couple of tidbits in there that may give some clues.

 

 

And a second one that I've not seen before, from Siam Legal dated a month ago, a few interesting points in there, not least of which being when foreigners need to file a tax return. The relevant slide starts, "A Foreigner shall file a tax return if: Bear in mind, this is from Siam Legal.

 

 

The Siam Legal guy was asked whether using a foreign credit card in Thailand would be a taxable remittance.

He said yes,  and his teacher thinks so, too. This teacher is a professor who is also a judge at the tax court.

[chiang mai]

3 hours ago, Lorry said:

The Siam Legal guy was asked whether using a foreign credit card in Thailand would be a taxable remittance.

He said yes,  and his teacher thinks so, too. This teacher is a professor who is also a judge at the tax court.

I saw that but was waiting for somebody else to mention it so thanks. The big one for me is the part about who must file and when. For the first time we have a major Thai law firm telling us that foreigners must file, not just everyone but foreigners specifically must file, when the assessable income thresholds are breached. NO mention is made of using common sense to see if tax is due and if not, making your own arbitrary decision not to file; NO mention is made of self assessing whether your TEDA levels means that you shouldn't file, if you TEDA means no tax is due. It's black and white and it's a law firm telling us, foreigners must file if they have over 60/120k of assessable income. Do I like it? Not much! But I'm happier that SIAM Legal interprets the tax rules the same way that I do and that we no longer have to rely on an unwritten rule that is supported only by a couple of farangs on AN.

 

The other point worth mentioning is in the PWC video where they talk about the TRD using AI to determine which customer records should be audited etc etc. Take it with as many grains of salt as you wish but that's certainly the direction we're headed. The idea that TRD is several hundred people sat behind several hundred thousand grey metal desks, surrounded by mountains of paper tax returns, is not even remotely where we are.

[jayboy]

57 minutes ago, chiang mai said:

major Thai law firm

 

It's not.

[chiang mai]

Take this in the context of the future and what is being asked for. In this case, Negative Income Tax, as requested by the Finance Permanent Secretary.

 

What is negative income tax? A system where anyone earning under the income (not tax)  threshold is paid support by government, based on their earnings.  It's not welfare, it's work related, the further you are away from an optimal income, the more the government pays you. In order for the system to work, everyone must report all their earnings, above the tax reporting threshold, otherwise they can't participate. This supports the desire to have anyone earning, even if there is no tax to pay. 

 

The same system is being explored in many countries as a way to eradicate poverty and to increase the tax take.

 

https://www.itax.in.th/media/negative-income-tax/

 

https://www.bangkokpost.com/business/general/2861888/official-backs-negative-income-tax-concept#:~:text=Finance permanent secretary Lavaron Sangsnit,falls below a specified threshold.

 

 

 

[chiang mai]

18 minutes ago, jayboy said:

 

It's not.

You're right, not the best choice of words on my part. Well known, significant, farang friendly, prominent, well regarded take your pick. But it doesn't change the fact that it's a well regarded law firm, so if we're going to pay attention to what the other say, we need to pay attention to this one also. 

 

https://www.legal500.com/firms/34053-siam-legal-international/c-thailand/about

[Thingamabob]

This piece is 6 months old. Fact is it is still uncertain whether or not this is going to happen. 

[chiang mai]

3 minutes ago, Thingamabob said:

This piece is 6 months old. Fact is it is still uncertain whether or not this is going to happen. 

which piece or thing are you referring to?

[Presnock]

On 10/6/2024 at 4:26 AM, chiang mai said:

You seem to think that the Thai tax issues affect only wealthy individuals and ignore the vulnerable, average and aged expat pensioner retiree who has no experience of managing or filing tax returns. My interest lies in trying to help the average and below average member, many of whom are deeply scared and confused by all things foreign tax related. My past tax, finance and Big 4 work experience, combined with the fact I have lived in Thailand full time for over 20 years, may be of help to some of that group. Those things are why I mostly ignore the never ending debates about CRS and foreign DTA's.

 

I have no interest in the tax affairs of people like you and others who talk in terms of buying 1,000 Apple and being concerned at the tax implications when you sell, or the large dividend payments given to you by your parents. If you can afford to buy 1,000 Apple you can also afford to put your hand in your pocket  and spend 20k at Ernst and Young and get the best Thai tax advice that money can buy. So exactly why you even bother to log onto this thread, especially given that you live full time over 8,500 kms away. is extraordinary, to say the least!

 

If there are members of AN who risk millions in tax as a result of CRS, they must be some of the cheapest rich people on the planet, in order to have such wealth yet seek tax advice from a social networking forum! I am personally aware of at least two  AN members who talked in terms of self harm and required support and intervention, such was their fear of what might happen to their paltry income in retirement here as a result of the tax changes. Meanwhile,  you talk about the millions at risk overseas by wealthy expat, dear Lord, we're not even on the same planet, let alone the same subject.

 

I will be very happy if you wish to add me to your ignore list, that way my contributions won't interfere with your enjoyment.

Chill ol' buddy - your help is always appreciated by the majority anyway.  I agree that the problem with the rich is that they are rich and seem afraid that they will lose their richness.  I get occassional slams for my verbiage on certain subjects especially the taxes as I was totally ignorant originally when all the taxation schemes erupted and by reading notes from Mike Lister, you and a couple of others, I learned exactly where I could find the necessary documentation of the Thai Revenue Dept.  NOW, I fully understand my tax status and am worry free as my finances are super basic.  But I have avoided many other small tax

and income problems.  If I know the answer for sure then I might say something.  But mostly what I tell folks is that we must wait until the final gazette is published to know for sure exactly what the Thai revenue department is actually going to do come 1 Jan-31 March 2025 and any possible subsequest worldwide taxation.  Based on the local situations, this govt will continue to need and thus seek any possible extra baht out there!  Best if luck for all the expats.

[Mike Teavee]

1 hour ago, chiang mai said:

The big one for me is the part about who must file and when

I've decided I'm going to File a return for this year (Have filed previously & already have a TIN so can do it all online).

 

My original thinking was that I have approx. 8K in withheld tax that I can claim back, but now I'm thinking I'll remit enough money so I'll break even or have a small (couple hundred THB max) Tax liability.

 

TBH I need the cash & taking it out of my fixed deposit accounts would cost me more so it makes sense to me.

[tandor]

1 hour ago, chiang mai said:

I saw that but was waiting for somebody else to mention it so thanks. The big one for me is the part about who must file and when. For the first time we have a major Thai law firm telling us that foreigners must file, not just everyone but foreigners specifically must file, when the assessable income thresholds are breached. NO mention is made of using common sense to see if tax is due and if not, making your own arbitrary decision not to file; NO mention is made of self assessing whether your TEDA levels means that you shouldn't file, if you TEDA means no tax is due. It's black and white and it's a law firm telling us, foreigners must file if they have over 60/120k of assessable income. Do I like it? Not much! But I'm happier that SIAM Legal interprets the tax rules the same way that I do and that we no longer have to rely on an unwritten rule that is supported only by a couple of farangs on AN.

 

The other point worth mentioning is in the PWC video where they talk about the TRD using AI to determine which customer records should be audited etc etc. Take it with as many grains of salt as you wish but that's certainly the direction we're headed. The idea that TRD is several hundred people sat behind several hundred thousand grey metal desks, surrounded by mountains of paper tax returns, is not even remotely where we are.

big fish are easier to spot and gut..but AI is going to catch us all.

[chiang mai]

4 minutes ago, Mike Teavee said:

I've decided I'm going to File a return for this year (Have filed previously & already have a TIN so can do it all online).

 

My original thinking was that I have approx. 8K in withheld tax that I can claim back, but now I'm thinking I'll remit enough money so I'll break even or have a small (couple hundred THB max) Tax liability.

 

TBH I need the cash & taking it out of my fixed deposit accounts would cost me more so it makes sense to me.

I will probably do the same but wont pay tax, it just keeps the i's dotted and the t's crossed and avoids potential downstream issues. I mean, it's only 15 minutes of my life, I waste longer than that, trying to decide what I'm going to do that day!

[Thingamabob]

47 minutes ago, chiang mai said:

which piece or thing are you referring to?

Ref. Lister's article dated 19th May 2024.

[chiang mai]

1 minute ago, Thingamabob said:

Ref. Lister's article dated 19th May 2024.

No idea what you're talking about so I can't respond as to whether you are right or not. And you seem unwilling to explain, so what more can be said!

[Presnock]

33 minutes ago, tandor said:

big fish are easier to spot and gut..but AI is going to catch us all.

That is for sure, in more ways than just this Thai tax bit.  

[Thingamabob]

1 minute ago, chiang mai said:

No idea what you're talking about so I can't respond as to whether you are right or not. And you seem unwilling to explain, so what more can be said!

I repeat, one more time, I am referencing Lister's article dated 19th. May 2024 as headlined above. Have a nice day.

[chiang mai]

4 minutes ago, Thingamabob said:

I repeat, one more time, I am referencing Lister's article dated 19th. May 2024 as headlined above. Have a nice day.

I went through Listers posts dated that day and couldn't see anything pertinent plus my mind reading abilities are not up to scratch this morning, perhaps after coffee they'll improve!.

[Thingamabob]

4 minutes ago, chiang mai said:

I went through Listers posts dated that day and couldn't see anything pertinent plus my mind reading abilities are not up to scratch this morning, perhaps after coffee they'll improve!.

Me likewise !

[Mike Teavee]

1 hour ago, tandor said:

big fish are easier to spot and gut..but AI is going to catch us all.

You don't need AI you just need decent data... 

 

It would take minutes to get a list of all Foreigners who have spent more than 180 days in Thailand assuming Thailand keeps track of passport numbers & length of time spent in country (which they do)

 

It would take minutes to get a list of all Foreigners who have remitted money to Thailand this year & their passport number (already provided to them by all of the Banks). 

 

It would take seconds to do a "Union" query to match the 2 datasets & go after those who haven't filed, maybe for legit reasons like only have US Social Security coming in but I'm sure they'd catch enough to make the 2,000B fine for not filing worthwhile. 

 

End of the day the data set would be limited to the approx. 300,000 Expats living in Thailand (& from that you could exclude guys who are working & are already filling returns), could do that using MS Access if not Excel. 

 

[Dakhar]

The same could be said for a lot of things, but oddly enough those "minutes" seem to be unsurmountable. 

 

(For example traffic fines)

[chiang mai]

Anyone taking issue with the contents of the two videos I posted earlier and the information contained in them, should address their concerns to Price Waterhouse Coopers and Siam Legal and not to me, I'm just the messenger and I don't want hear them. 

[Yumthai]

1 hour ago, Mike Teavee said:

It would take minutes to get a list of all Foreigners who have remitted money to Thailand this year & their passport number (already provided to them by all of the Banks). 

Do you believe Thai banks systematically send TRD yearly an aggregated list of all customers' accounts including all offshore inward deposits? I don't think so. TRD surely may require access to an individual accounts but with a proper legal warrant/reason.

 

[JimGant]

7 hours ago, Lorry said:

The Siam Legal guy was asked whether using a foreign credit card in Thailand would be a taxable remittance.

He said yes,  and his teacher thinks so, too. This teacher is a professor who is also a judge at the tax court.

Ludicrous. Even if the credit card purchase I make in Thailand is not considered a loan, but a marker to be paid back from my checking account -- who's to say that money in my checking account is income, or even assessable income for Thai tax purposes? In my case, all the money in my checking account is from direct deposits from my govt pension and from social security. And this money is non assessable by Thailand, per DTA. Thus, when my bank direct debits my checking account, to pay back the loan -- it's tapping non assessable income. And this would be even more obvious, should I use a debit card, whereby the payment to Thailand is a near instant suck from my checking account.

 

So, unless Thailand is treating all foreign remittances  as assessable income -- even in the guise of a credit card purchase -- then you can't say all remittance scenarios are taxable events. And, it's unimaginable that Thailand is treating all remittances as assessable income, nor do they have the resources to parse all remittances for assessability (they would need a data base incorporating language from 61 DTAs). So, another situation where self-assessment is a necessity.

 

Thus, Siam Legal seems to have a few holes in their thought process. Not sure I'd want to rely on any of their guidance.....

 

 

[chiang mai]

I believe Thai Banks are required to send details of all inbound deposits to the BOT daily, in order for them to fulfil their role in managing the currency against foreign currencies  and to manage Baht strength. I also believe that they may send details of the recipient since I had a call from BOT regarding an inbound remittance, in the mid 2000's when they wanted to know the purpose of the funds and my plans....6.5 mill to buy a condo in 2007.

[Yumthai]

1 minute ago, chiang mai said:

I believe Thai Banks are required to send details of all inbound deposits to the BOT daily, in order for them to fulfil their role in managing the currency against foreign currencies  and to manage Baht strength. I also believe that they may send details of the recipient since I had a call from BOT regarding an inbound remittance, in the mid 2000's when they wanted to know the purpose of the funds and my plans....6.5 mill to buy a condo in 2007.

BOT <> TRD

[Mike Teavee]

16 minutes ago, Yumthai said:

Do you believe Thai banks systematically send TRD yearly an aggregated list of all customers' accounts including all offshore inward deposits? I don't think so. TRD surely may require access to an individual accounts but with a proper legal warrant/reason.

 

Thai Banks have to send TRD a list of all accounts where they've withheld interest, so yes, I do believe they send them a list of all customer accounts.

 

They probably don't (currently) send inward deposits but again, that would take minutes to sort out. 

 

 

Edit:

Select Customer.PassportNumber, Sum(Transaction.Credits)

From Customer, Transaction

Where Customer.CustomerID=Transaction.CustomerID

Group by PassportNumber

 

Been a few years since I've had to write any SQL so excuse me if I fluffed up

[Yumthai]

Just now, Mike Teavee said:

Thai Banks have to send TRD a list of all accounts where they've withheld interest, so yes, I do believe they send them a list of all customer accounts.

 

They probably don't (currently) send inward deposits but again, that would take minutes to sort out. 

The list of accounts they've withheld interest is not comprehensive of tax residents holding accounts not bearing interests.

 

I assume sharing a systemic list of accounts transactions is against data privacy.