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

[oldcpu]

17 minutes ago, chiang mai said:

The bigger problem is those expats who have existed in Thailand using current month income, either because their visa requires the income method, or because their finances require it to be so. Others like myself find it convenient and practical to remit pension payments directly to a Thai bank account, despite the income not being required for a visa..... I'm certain there will be many others who do the same.

 

Those are people who remit current year income, which of course, has always required a tax return is filed. Yet we're told by some members that only a miniscule percentage of retired expats have ever filed tax returns on a regular basis, this potentially leave what, 10,000, 30,000, 50,000 expats who have knowingly committed tax evasion by not filing. What can the excuse be, I didn't know I had to? Ignorance of the law is, they say, no defense but it's really the only one there is. I don't think for one moment that TRD is going to go after those people but that's not the point. The point is that they could, if they chose to and the case against them is indefensible.

 

I believe that is an incorrect generalization to which I have a different view.

 

I suspect most of those who are you are considering, may have ALREADY paid tax on the income, and are covered by a DTA between the country where their income sourced, and Thailand.

 

Further, I also suspect many of those have savings in excess of their annual income OUTSIDE of Thailand, and hence they can make a valid financial case that the money they brought in is NOT current year income (which would be especially relevant for those where the DTA did not cover their income).

 

so I dare say your 10,000, 30,000, 50,000 figure is simply not correct.

 

On this - unless either of can point to a definitive statistic that is not questionable, I think we will need to agree to disagree.

.

Edited 7 hours ago by oldcpu

[Yumthai]

19 minutes ago, chiang mai said:

Those are people who remit current year income, which of course, has always required a tax return is filed. Yet we're told by some members that only a miniscule percentage of retired expats have ever filed tax returns on a regular basis, this potentially leave what, 10,000, 30,000, 50,000 expats who have knowingly committed tax evasion by not filing. What can the excuse be, I didn't know I had to? Ignorance of the law is, they say, no defense but it's really the only one there is. I don't think for one moment that TRD is going to go after those people but that's not the point. The point is that they could, if they chose to and the case against them is indefensible.

I suspect there are more expats committing tax evasion than your numbers. I would say it's not only about ignorance of the Law, it's also because of no rules enforcement or corruption awareness. If TRD is not going after these people, as you mention, then there is no worry nor case to be defended.

[oldcpu]

1 minute ago, Yumthai said:

I suspect there are more expats committing tax evasion than your numbers. I would say it's not only about ignorance of the Law, it's also because of no rules enforcement or corruption awareness. If TRD is not going after these people, as you mention, then there is no worry nor case to be defended.

What I typed in response to Chiang Mai applies.

 

I suspect most have aleady paid tax and are protected by a DTA.  And further many likely have savings outside of Thailand, yielding higher interest than what Thai banks can provide, and hence they can financially prove they are not in effect bringing in current year income.

 

Neither of us have the actual proof here - so this is speculation - at best, IMHO.

[oldcpu]

8 minutes ago, oldcpu said:

I suspect most have aleady paid tax and are protected by a DTA. 

 

 

If one looks at lists as to the % of the nationalities that make up the most expatriates in Thailand (lets look at the top 10 or so), EVERY ONE comes with a country with a DTA ...  I note:

- Myanmar - DTA
- Cambodia - DTA
- Laos - DTA
- China - DTA
- Great Britain & Northern Ireland - DTA
- Japan - DTA
- India - DTA
- USA - DTA
- Netherlands - DTA
- Germany - DTA
- France - DTA
- Russia - DTA

My speculation is that most of those from Myanmar, Cambodia and Laos are likely working in Thailand, so they do not fall under the consideration of this discussions of expats bringing in money to Thailand.  One might also speculate that applies to China, although clearly there is a lot of Chinese money brought into Thailand.

 

The remaining countries with the largest #s of expatriates, all have DTAs with Thailand.  And so before stating that they may be avoiding tax, one really needs to check the details of their DTAs.

.

It is possible, thou, that many are not filing tax returns when some of them should be (filing tax returns) even if they owe no tax.

[Yumthai]

8 minutes ago, oldcpu said:

What I typed in response to Chiang Mai applies.

 

I suspect most have aleady paid tax and are protected by a DTA.  And further many likely have savings outside of Thailand, yielding higher interest than what Thai banks can provide, and hence they can financially prove they are not in effect bringing in current year income.

 

Neither of us have the actual proof here - so this is speculation - at best, IMHO.

Agreed, we can't know for sure. DTAs are complex and do not 100% bulletproof remitted income depending on case.

How about all foreigners who have bought properties in Thailand? It's reasonable to think most have sold assets abroad to remit and buy within the same year.

[sometimewoodworker]

33 minutes ago, oldcpu said:

 

I suspect most have aleady paid tax and are protected by a DTA.

Part of the amounts remitted are covered by the tax paid (NB you need proof of tax payment) however DTA’s especially from low taxation countries do not shied remittances from Thai taxation.

 

Even from higher taxation countries like the U.K. there is a range where the U.K. personal allowance is higher than the Thai allowances so Thai tax is due. And when you get to Singapore with a maximum tax rate of 24% (at 24million baht) virtually all income remitted will attract Thai taxation.

 

The concept that a DTA provides immunity from Thai taxation is wrong.

You may not have meant that but if you didn’t then you need to change the wording of your statements.

[oldcpu]

14 minutes ago, sometimewoodworker said:

The concept that a DTA provides immunity from Thai taxation is wrong.

You may not have meant that but if you didn’t then you need to change the wording of your statements.

 

No - I don't need to change any more than claims "of 10,000, 30,000, 50,000 expats who have knowingly committed tax evasion" when such is HIGHLY UNLIKELY the case.

 

Further DTAs CAN provide immunity from Thai tax in some cases.  Not all cases.  Which is why I noted DTAs must be examined. I was clear there.

 

Further, case in point:  My Canadian pension can ONLY be taxed in Canada. FULL STOP. This is in accordance with the Canada-Thai DTA.  The DTA does for that pension provide immunity from Thai taxation. It is NOT wrong.

 

Perhaps, you did not mean to say what you did , but if you didn't then maybe you need to change the wording of your statement.

Edited 6 hours ago by oldcpu

[The Cyclist]

55 minutes ago, chiang mai said:

Others like myself find it convenient and practical to remit pension payments directly to a Thai bank account, despite the income not being required for a visa..... I'm certain there will be many others who do the same.

 

56 minutes ago, chiang mai said:

Those are people who remit current year income, which of course, has always required a tax return is filed. 

Yet we're told by some members that only a miniscule percentage of retired expats have ever filed tax returns on a regular basis,

 

The majority of other Brit retirees that I know here in Thailand, are on some form of Government Pension. Be that ex police, ex forces, an ex fireman and a coupke of others. Granted, it is small cohort, but if that is extrapolated across the whole of Thailand, then yes, very few would be filing tax returns.

 

The other cohort that I knew going back 6 to 12 years ago were mostly O & G workers, who like me, were never tax residents and never needed to file a tax return.

 

So on the Brit side, I don't think that there would be large numbers tax filing, aside from those that were legally working in Thailand.

[sometimewoodworker]

29 minutes ago, oldcpu said:

Further, case in point:  My Canadian pension can ONLY be taxed in Canada. FULL STOP. This is in accordance with the Canada-Thai DTA.  The DTA does for that pension provide immunity from Thai taxation. It is NOT wrong.

I have no idea, nor is it relevant, of your sources of income.
 

ALL DTA’s provide protection for some income types against Thai taxation 

NO DTA provides protection for all types of income 

 

38 minutes ago, oldcpu said:

Further DTAs CAN provide immunity from Thai tax in some cases.  Not all cases.  Which is why I noted DTAs must be examined. I was clear there.

You may have believed you were clear, you were not.

 

The implication of your post was that the mere presence of a DTA made all the income immune to Thai taxation 

 

You now say that, that was not your meaning. I accept your reworded statement as a significantly better statement of the facts.

[oldcpu]

23 minutes ago, sometimewoodworker said:

You may have believed you were clear, you were not.

 

The implication of your post was that the mere presence of a DTA made all the income immune to Thai taxation 

 

 

 

You are incorrect.  You need to read more carefully.  Look above where I specifically stated:

 

The remaining countries with the largest #s of expatriates, all have DTAs with Thailand.  And so before stating that they may be avoiding tax, one really needs to check the details of their DTAs.

 

What part of that do you not understand?

 

 

Edited 5 hours ago by oldcpu

[oldcpu]

41 minutes ago, sometimewoodworker said:

You now say that, that was not your meaning. I accept your reworded statement as a significantly better statement of the facts.

 

I reworded nothing. I tried to clarify your not reading.  I stand by my statements. You may wish to edit yours.

Edited 4 hours ago by oldcpu

[oldcpu]

And to get back on point ...   claims "of 10,000, 30,000, 50,000 expats who have knowingly committed tax evasion"  by bringing foreign income into Thailand then such is HIGHLY UNLIKELY the case.  There is NO evidence to suggest such. 

 

Rather if one looks at the total # of expats from the different countries where the expatriates come from ... If one considers which countries where most expatriates who bring money into Thailand come from (as opposed to the largest population of expatriates who are likely trying to send money out of Thailand (ie Myanmar, Laos, Cambodia) , and  if one looks at the DTA's from those countries where money is likely brought into Thailand, and if one examines the DTAs  - then it I believe the speculation "of 10,000, 30,000, 50,000 expats who have knowingly committed tax evasion"  is an exaggeration and inaccurate.

 

It does not help if we exaggerate.

.

Edited 4 hours ago by oldcpu

[Eudaimonia]

6 hours ago, oldcpu said:

Have you read a translation of the Revenue Department Order p161 and the subsequent clarification in Revenue Department Order p162?  

 

Please correct me if I am wrong,  but based on what I quoted - I suspect you did not (as my understanding is that P162 contradicts what you just posted).

 

Order 162/2566 clarified that the notorious order 161/2566, effective from January 1, 2024, does not apply to income earned before January 1, 2024.

 

This meant that income derived before January 1, 2024, would still be subject to the previous rule: it would only be taxed if brought into Thailand within the same tax year it was earned.

 

Ergo, foreign-source income earned in 2023 is only assessable if brought into Thailand in 2023. And this is why it was not a good idea for people to rush to send money in late 2023 from foreign accounts that already had income deposited earlier that year. (Not that I expect anyone to start asking questions about that now.)

Edited 2 hours ago by Eudaimonia

[chiang mai]

5 hours ago, oldcpu said:

 

I believe that is an incorrect generalization to which I have a different view.

 

I suspect most of those who are you are considering, may have ALREADY paid tax on the income, and are covered by a DTA between the country where their income sourced, and Thailand.

 

Further, I also suspect many of those have savings in excess of their annual income OUTSIDE of Thailand, and hence they can make a valid financial case that the money they brought in is NOT current year income (which would be especially relevant for those where the DTA did not cover their income).

 

so I dare say your 10,000, 30,000, 50,000 figure is simply not correct.

 

On this - unless either of can point to a definitive statistic that is not questionable, I think we will need to agree to disagree.

.

I don't think about the 4 million or so foreigners who live in Thailand, only the 180,000 or so Western expats, some of whom have frequented these forums for the past 20 years or more. I know from previous debates over that period that the number of expats using the income method is not small, but I have no idea what the number is. The fact remains that even today, many expats are unable to raise the 800k needed for a visa deposit and must resort to illegal agency tactics for this purpose.....I don't believe this is a small number of expats.

 

I cannot recall ever being involved in even one discussion about Thai Tax, prior to the current slew of threads following news of the rule change, tax was simply not something that members debated, or even enquired about, it just wasn't on anyone's radar. If ever there was a debate involving tax, it was always in the context of tax free interest bearing accounts available in the IOM and elsewhere offshore.

 

From a personal perspective, Thai tax was never something that featured in my remittance planning over the years so I suspect there were times where I remitted savings principle along with interest earned in the same year. My pensions have long been deposited directly into my Thai account but fortunately are multi country sourced, the combination of which makes the total free of Thai tax. But I recall from those past debates that many were not as fortunate yet still tax was never an issue.

 

I did not generalize about the number of expats, I said I don't know and merely offered a probable range. Unlike you I think it is sometimes helpful to remind ourselves of these these types of issues because it may provide some insight into TRD thinking, rational and motivation. I have no idea how many people have ignored Thai tax over that period or whether the range should be 1000 or 5,000 or 10k, 30k or 50k.  What I do know for certain is that tax was never a concern and for many it was never a consideration, so if the number ended up being higher rather than lower, I for one would not be at all surprised.  Of far bigger concern to expats over that period was the Baht/Pound exchange rate, which threatened to make many expats ineligible for their visa's and did send many back home as it fell from the 70's down to the low 40's over many years.

 

  

Edited 2 hours ago by chiang mai