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

[Mike Teavee]

8 minutes ago, stat said:

I beg to differ again. The withholding tax is paid by the individual and NOT the company. Example if you live in a country with no dba with the us you pay a higher withholding tax as if you were living in a country with a dba with the us (15% in that case). That is what the w8-Ben is made for. Your accountant maybe be refering to a specific case or he has not a full understanding of witholding tax, sorry to say. It can be very complicated to do withholding tax reclaim in some cases next to impossible.

 

Example:

https://www.spglobal.com/marketintelligence/en/mi/research-analysis/the-path-to-unlocking-unclaimed-withholding-tax-reclaims.html

Trust me as an ex-owner of a UK LTD company that paid dividends, the Tax I misunderstood was actually the company offsetting profits against corporate tax not me as an individual..

 

I really got things wrong on this one (Hold my hand up). 

 

 

Anyways, I'm done on this thread, apparently discussing UK Tax related issues is frowned upon on here so I'm bowing out (as I've noticed Mike L has already done). 

 

Good luck to all.... 

 

[sometimewoodworker]

2 hours ago, sirineou said:

Very hard to foLlow the Thread , a lot of good information buried under an avalanche of bickering . But it's good to know, though I think this loophole will be closed otherwise it would make this whole tax endeavour  moot. Why then wouldn't  everyone simply gift the money they transfer to their wife. (assuming of course they are married)  I don't see the  money anyway.   

If you get any benefits from the gift it is no longer a gift and is assessable income.

 

conceivably if your wife purchased land to the value of the gift it would qualify, as long as you never benefit from the purchase.

[sometimewoodworker]

2 hours ago, sirineou said:

I think there might be a new industry of accountants for farangs. 

The big 4 are already booked almost nonstop and have had lots of consultations already, my appoint was about 5 weeks out

[sometimewoodworker]

2 hours ago, NoDisplayName said:

If I book a hotel in Thailand, or buy a computer, or buy Thai health insurance, or put tires on the pickup, and pay by foreign credit card .....those would all be considered taxable remittances?

Yes they would 

[sirineou]

3 minutes ago, sometimewoodworker said:

t is almost certain that you will benefit from a conversation with an expert on the Thai and USA situation.

As I said , it looks like that accountants for farangs will become a lucrative business.

They say that the new tax system is designed to increase Thai tax revenue, I think it will have the opposite effect of people transferring to Thailand the absolute minimum.

Anyway, It was a pleasure talking to you guys, got to go take a shower 'cause wife wont let me in bed unless I do.  lay down and read for an hour or two , and hopefully fall asleep. 

Good Night  

[sometimewoodworker]

1 hour ago, sirineou said:

I can't believe she would be living in Thailand a multimillionaire and not pay taxes. 

She can avoid paying income tax if she has no income. She can’t avoid all taxes but she can easily live on the income generated by a few million US$

 

The reason for the loophole being closed was to get income tax being evaded by the high net worth Thai taxpayers foreigners are collateral damage 

[jwest10]

2 hours ago, TroubleandGrumpy said:

I have done the numbers for Aussies and provided my thoughts - just focused on Aussies though (7k to 12K Baht for some).

 

 

 

[jwest10]

Just now, jwest10 said:

 

 

[jwest10]

Yes,  just giving my experiences and am a frozen British pensioner but was speaking to a couple of people tonight and all suggesting wait and see if and when these new forms to come about.
Also stated we await the official announcement but no one seems to know anything and yes of course the present Government, the Revenue and all the tax and accounting "experts"
We wait and see  but also planning and the key date os 1st Jan 2025 and maybe we will hopefully find out before then if we ever do.
More likely we file a tax form if we can and then the Revenue will ask questions?

[sometimewoodworker]

1 hour ago, jwest10 said:

Yes,  just giving my experiences and am a frozen British pensioner but was speaking to a couple of people tonight and all suggesting wait and see if and when these new forms to come about.
Also stated we await the official announcement but no one seems to know anything and yes of course the present Government, the Revenue and all the tax and accounting "experts"
We wait and see  but also planning and the key date is 1st Jan 2025 and maybe we will hopefully find out before then if we ever do.

It is, as I have mentioned, unlikely that the 2024 tax return will have much change from the 2023 one.

the guidance notes will have significant changes, though again not many as the rule is only slightly different.

1 hour ago, jwest10 said:

More likely we file a tax form if we can and then the Revenue will ask questions?

You can almost certainly file a tax return! However you do not want the TRD to be asking questions as that is most likely to be an audit of your return and audits are never welcome 

[Klonko]

The process for Thai tax residents reclaiming (partially) withholding tax on dividends and interest on foreign assets is country specific. For Switzerland, you have to provide a TRD certificate being a Thai tax resident to the Swiss federal tax revenue service. Applications are sometimes forgotten or lost. Faulty bureaucracy is a worldwide phenomenon. I do not know yet (my information comes from a compatriote with income in Thailand) if TRD issues Thai tax residence certificates without TIN, but I would not be surprised if a TIN or even (pro forma) tax filing were required.

[JBChiangRai]

I posted this elsewhere, but I will repeat it here as it is important.

 

My opinion on this whole fiasco, is that September's announcement aimed at Thai people should have just slid under the radar.

 

A minor change that would probably impact foreigners in a minor way or not at all has been picked up the expat community and trumpeted from the rooftops as doom & gloom and because of all that "noise" it now faces the risk of becoming a self-fulfilling prophecy.

 

The change was simple and to earned income being transferred in a year subsequent to when it was earned.  My accountant told me years ago that they would close this avenue.

 

Expats started noisily shouting "What about me, What about me?" 

 

What everyone failed to notice was that we have always been liable to Thai Income Tax on earned income brought here in the same year.  They have never enforced it, now because of all this noise they may in the future.

 

Thai governmental style is to float something in the media and quietly watch the reaction.  You've seen it recently with Cannabis legislation.  If the public hate it, then they issue a statement saying it's not going ahead.  All the noise from Expat's has been incredibly damaging.

 

Absolutely the worst thing that could happen now is hundreds or thousands of expats start filling in tax returns.   You want to make the whole expat community an easy mark?  Then go ahead.

 

If you want this to disappear, then keep quiet and do nothing and wait for clarification addressed specifically to us.

 

It's important that any kind of public feedback you give furthers the cause of this disappearing.  DO NOT publicly say you will fill in a tax return.

 

When I received the questionnaire from Thai Privilege Company, I told them unequivocally that I would leave Thailand if they taxed me transferring funds from the UK.  Feedback is important - don't make this a self-fulfilling prophecy!

[Presnock]

16 hours ago, sirineou said:

I am very well familiar with the DTA Agreement between the US and Thailand, and I have read the pda agreement, but it is written in legalese and unclear as to what applies or how Thailand will implement that Agreement. 

I have read several Thai brochures and and IMO they are as clear as mud. 

for Instance my understanding of  the DTA. says that Governmental pensions, social security and other pensions are taxed in their country of Origin.   They are called non assessable income. 

Is My Union Pension only taxed in the US? 

I comfortably live on my SSI income , and save my Union pension. Are these savings assessable .

IF your assessable income falls below a certain level I think you dont have to file a tax return. and if my understanding of the DTA is correct  since all of the income I transfer to Thailand is non assessable,and I don't have to file a tax return, how do they know that all of my income is non assessable?

before 2024 I sold several pieces of property in the US and have a substantial amount of income in CDs and Treasuries. How s that handled ? Is the interest of such non assessable investments taxable in Thailand. 

can  I only transfer an amount equal to my SSI income and subsidise this from Savings earned before 2024  for the rest of my life here. 

Or are transfers from savings earned  before 2024 0nly non taxable when transferred to Thailand  for the first Year. or in perpetuity. 

 I will tell you this , aside from my American passport I have a Greek EEU passport.One of the reasons why we moved here instead of Greece it was the same tax complexity and bureaucracy , In my retirement I want easy. Personally I like it much better in Greece, I speak some of the language, most of the people speak english, and then we have the magnificence of the Greek Islands  the mainland I that is understated by mosT people, season, some skiing , the food, but I am not sure how my Thai wife will do there. and If I was to pass away, she will have to come back to Thailand or go to the US, i don't think she will stay there on her own.

  Anyway I will wait to see how this thing works out, for most of us it is probably a tempest in a tea cup. But if they make me jump through too many hurdles I am out of here.   

 

I too have read the DTA between the US and Thailand - I only have seen US government pensions are taxed only by the US government but that other state pensions may not be taxed only by the US government.  To me the DTA allows the Thai Revenue Department to also tax non US government pensions.  Yes Social security also is totally taxed only by the US government IAW the DTA.  That is why many people will probably need a local tax agent who hopefully understands what the TRD will determine what is assessable or not or as others have suggested, go the the local DTR office (with a Thai speaker if you aren't fluent in Thai) and query their interpretation.  But from what I have read on this forum from those who have gone to the local TRD and asked any questions about interpretations based on the new interpretations, the local office reps have not been given any directions YET so maybe you can get an idea of what they will say or maybe not.  Some of the local tax agencies are responding to questions about the TRD and what might transpire based on their interactions wtih them previously.  Some of these agencies are responding to questions without needing to be paid, hoping to have a new client when 2025 rolls around.  Good luck.  

[dinga]

12 hours ago, sometimewoodworker said:

If you get any benefits from the gift it is no longer a gift and is assessable income.

 

conceivably if your wife purchased land to the value of the gift it would qualify, as long as you never benefit from the purchase.

Herein lies a potential problem - given the 'giftor' has a 50% interest in property obtained during the marriage, under the C&C Code.  Seems to me the TRD may well challenge the bona fides of at least 50% of the 'gifted' amount.  Again - prudent to obtain professional advice before proceeding  

[motdaeng]

38 minutes ago, JBChiangRai said:

It's important that any kind of public feedback you give furthers the cause of this disappearing.  DO NOT publicly say you will fill in a tax return.

 

i will fill out the tax return, as i have for the past 10+ years. by the way, i'm not working and i hope to receive a nice pension in nine years ...

 

what i recommend to my friends is:

- to wait end of february 2025 before taking any action. this gives you still time to get a TIN number and complete the tax return.

- only transfer this year (2024) as much money to thailand to avoid paying taxes. the exact amount depends on many factors.

- if possible, avoid any 'stunts' with gifts, savings, or things that aren't 100% cleared by TDA.

 

 

[JBChiangRai]

2 minutes ago, motdaeng said:

 

 

- if possible, avoid any 'stunts' with gifts, savings, or things that aren't 100% cleared by TDA.

 

 

 

Could you clarify "stunts"?

[motdaeng]

1 minute ago, JBChiangRai said:

Could you clarify "stunts"?

 

sure, i refer to a "stunt" as something risky where the outcome can go in any direction!

(i think you know, english isn't my first language)

[JBChiangRai]

In my case, I am using gifting and it is not a "stunt".

 

I have 2 adopted Thai daughters (orphans) at a distant university where I have bought them a house and cars.

 

I have gifted an annual sum to each of them to cover their university fees and day to day living expenses.  I cannot gain any benefit from it, the gift is entirely for them and it is under the 10M baht limit.

 

Would you call that a "stunt" ?

[TroubleandGrumpy]

12 hours ago, sometimewoodworker said:

If you get any benefits from the gift it is no longer a gift and is assessable income.

 

conceivably if your wife purchased land to the value of the gift it would qualify, as long as you never benefit from the purchase.

Disclaimer - my opinions only - bla bla bla.

If I may - that is not totally correct - that is an assumption - and is IMO that assumption is wrong.

If you look at the rules in the Revenue Codes regarding Gifts and rulings as applied later, and most tax experts websites, it is clear that gifting money or assets to your spouse is covered under the tax free limit up to 20million baht.

There are many circumstances where that has impact and/or can be used by a married Expat in Thailand

 

However, lets talk about one - the remitting of money into Thailand as a gift to your wife.

If that money is taxable income that would otherwise be subject to taxation, then that is when the 'retained benefit' could be an issue.

If that money was income earned before 1 Jan 2024 and/or was from savings, then it is not taxable income.

 

So the only taxation applicable money gifted to a spouse, that has taxation implications is taxable income.

Then the matter is as clear as mud - it might be tax free (up to 20Mil) or it might not be - no one knows 100%.

And that includes the tax experts - Thailand does not work on precedent and/or strict rules - it is up to each Officer.

 

It is worthwhile knowing what that rule/law is all about and why it was done.

The reason for that rule/law and why the limit set at 20 Million, was because gifts were tax free in Thailand.  But then Thais were gifting their assets (and money) to their spouses and children when they got old, as a way to avoid inheritance taxes. 100s of Millions of Baht at a time!

 

For the rest of my views and what I think is AOK - read between the lines and follow my earlier advice (and what others have said many times).

 

[TroubleandGrumpy]

13 hours ago, Mike Teavee said:

Trust me as an ex-owner of a UK LTD company that paid dividends, the Tax I misunderstood was actually the company offsetting profits against corporate tax not me as an individual..

 

I really got things wrong on this one (Hold my hand up). 

 

Anyways, I'm done on this thread, apparently discussing UK Tax related issues is frowned upon on here so I'm bowing out (as I've noticed Mike L has already done). 

 

Good luck to all.... 

Mate - no need to do that - I have just started an Australian focused thread. Just do the same for UK.  And someone should do it for USA.

That way this thread is about the main issues - and anything related to specific countries is in other threads.

This thing aint going away anytime soon.

 

[motdaeng]

8 minutes ago, JBChiangRai said:

In my case, I am using gifting and it is not a "stunt".

 

I have 2 adopted Thai daughters (orphans) at a distant university where I have bought them a house and cars.

 

I have gifted an annual sum to each of them to cover their university fees and day to day living expenses.  I cannot gain any benefit from it, the gift is entirely for them and it is under the 10M baht limit.

 

Would you call that a "stunt" ?

 

no ... but there a few others think about (starting out of the blue) "gifting" they wife's and so on.

 

just remember, the TRD makes the decisions and calls ... i wouldn't choose to be the one who's testing it ...

[JBChiangRai]

6 minutes ago, motdaeng said:

 

no ... but there a few others think about (starting out of the blue) "gifting" they wife's and so on.

 

just remember, the TRD makes the decisions and calls ... i wouldn't choose to be the one who's testing it ...

 

I agree, gifting has to be extremely carefully set up and generally to a wife or girlfriend it's unlikely to be safe.

[TroubleandGrumpy]

57 minutes ago, JBChiangRai said:

I posted this elsewhere, but I will repeat it here as it is important.

My opinion on this whole fiasco, is that September's announcement aimed at Thai people should have just slid under the radar.

A minor change that would probably impact foreigners in a minor way or not at all has been picked up the expat community and trumpeted from the rooftops as doom & gloom and because of all that "noise" it now faces the risk of becoming a self-fulfilling prophecy.

The change was simple and to earned income being transferred in a year subsequent to when it was earned.  My accountant told me years ago that they would close this avenue.

Expats started noisily shouting "What about me, What about me?" 

What everyone failed to notice was that we have always been liable to Thai Income Tax on earned income brought here in the same year.  They have never enforced it, now because of all this noise they may in the future.

Thai governmental style is to float something in the media and quietly watch the reaction.  You've seen it recently with Cannabis legislation.  If the public hate it, then they issue a statement saying it's not going ahead.  All the noise from Expat's has been incredibly damaging.

Absolutely the worst thing that could happen now is hundreds or thousands of expats start filling in tax returns.   You want to make the whole expat community an easy mark?  Then go ahead.

If you want this to disappear, then keep quiet and do nothing and wait for clarification addressed specifically to us.

It's important that any kind of public feedback you give furthers the cause of this disappearing.  DO NOT publicly say you will fill in a tax return.

When I received the questionnaire from Thai Privilege Company, I told them unequivocally that I would leave Thailand if they taxed me transferring funds from the UK.  Feedback is important - don't make this a self-fulfilling prophecy!

 

Mate - it aint gonna disappear and go away - until the Thai Govt excludes Expats Pensions and already taxed income overseas.

It started in September when TRD made the announcement and Bangkok Post published it. 

Bangkok Post - Amendment to see overseas income taxed

dn161A.pdf (rd.go.th)

 

From there it was blown up by the tax 'experts' looking to drum up business - they started the fear campain.

But it truth, those of us with personal experience of the Tax Depts and how they can severely punish people, did over react (mea cupla).

TRD staff stated many times Expats have to pay income taxes and 'contribute to Thailand'.

Expats have been complaining - for many valid reasons - TRD could have stopped it - but chose not to (Falang pay mentality).

 

Now read this - "How do Foreigners living in Thailand pay tax" (by your loving TRD)

Foreign-sourced income tax-no logo (expattaxthailand.com)

 

What is being discussed now is not how bad it is (and could be) anymore - we have moved on.

Discussions now are mainly about how to deal with the issue, and how to reduce/eliminate Thai taxation (not tips on evasion - illegal).

[TroubleandGrumpy]

19 minutes ago, JBChiangRai said:

In my case, I am using gifting and it is not a "stunt".

 

I have 2 adopted Thai daughters (orphans) at a distant university where I have bought them a house and cars.

 

I have gifted an annual sum to each of them to cover their university fees and day to day living expenses.  I cannot gain any benefit from it, the gift is entirely for them and it is under the 10M baht limit.

 

Would you call that a "stunt" ?

No IMO that is not a problem.

Does that money come from income or from assets/savings?

[JBChiangRai]

41 minutes ago, TroubleandGrumpy said:

No IMO that is not a problem.

Does that money come from income or from assets/savings?

 

It comes from Income.

[Phulublub]

12 hours ago, jwest10 said:

Yes,  just giving my experiences and am a frozen British pensioner

jwest

 

Accoridng to https://www.gov.uk/tax-on-pension/tax-when-you-live-abroad#:~:text=If you live abroad but,UK tax on your pension.

"...If you’re not a UK resident, you don’t usually pay UK tax on your pension. But you might have to pay tax in the country you live in..." 

(For the avoidance of doubt of others, this refers to the UK State Pension, not private or Government Pensions)

 

you should not pay UK tax on your State Pension.  Is that the case for you?  if so, id dthis happend automatically when you informed HMRC of your residence status?

 

PH

 

 

[Yumthai]

47 minutes ago, TroubleandGrumpy said:

Discussions now are mainly about how to deal with the issue, and how to reduce/eliminate Thai taxation (not tips on evasion - illegal).

There is no issue as long as there is no individual audit to be seen and reported.

IMO all relevant tax discussions should only focus on how/when TRD plans to enforce their statements, collect money and address penalties.

Everything else is pure speculation and scaremongering.

[Phulublub]

7 minutes ago, Yumthai said:

There is no issue as long as there is no individual audit to be seen and reported.

IMO all relevant tax discussions should only focus on how/when TRD plans to enforce their statements, collect money and address penalties.

Everything else is pure speculation and scaremongering.

 

 

Isnt that a bit head in the sand?  Waiting untit you see others being audited and then finding out you should have been fiing returns will be too late to file those returns and if and when it is your turn, you will be in for a nasty shock. 

 

I will be looking at the new forms once they are available and if I have to file, I will - because my assessable income is made up of non-asseable pension and pre-2014 savings, I will not have any tax to pay.  Down the line, as I use up my pre-2014 savings, and once my UK State Pension kicks in (should Ilive that long) then I will have a small liability, which I will be content to pay for peace of mind if nothing else.

 

Evasion is evasion and is illegal.  Just because you might get away with it does not make it a good idea.

 

PH

[motdaeng]

11 minutes ago, Yumthai said:

There is no issue as long as there is no individual audit to be seen and reported.

IMO all relevant tax discussions should only focus on how/when TRD plans to enforce their statements, collect money and address penalties.

Everything else is pure speculation and scaremongering.

 

agree, speculation and scaremongering does not help!

 

some people prefer to be proactive and prepare for what might happen,

while others prefer to do nothing, believing (or hoping) that nothing will happen at all.

 

 

 

[Lorry]

1 hour ago, JBChiangRai said:

In my case, I am using gifting and it is not a "stunt".

 

I have 2 adopted Thai daughters (orphans) at a distant university where I have bought them a house and cars.

 

I have gifted an annual sum to each of them to cover their university fees and day to day living expenses.  I cannot gain any benefit from it, the gift is entirely for them and it is under the 10M baht limit.

 

Would you call that a "stunt" ?

 

I would only do it after professional advice, and preferably not this year - later, when the dust has settled.

Gift tax was discussed in the first tax thread in extenso, opinions differ.

I think Mike Lister has summarized it in the pinned tax guide. 

 

You are probably ok, but I would gift it as a special occasion, just in case: wedding or something like that (betrothal? Exams?). Birthday may not count.