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

[Mike Lister]

8 minutes ago, phetphet said:

Thank you. Maybe I should have worded it better, but I. Wasn’t talking about interest on the savings, but the savings themselves.

Having saved through my working life,  being retired for several years, and living in Thailand for eight, how does one go back to prove savings were from previous earnings and had already been taxed at source? 
Would the UK tax authorities even bother if asked?

 

Unless the Thai gov’t agrees not to tax anything prior to implementation of this rule, it is going to be a nightmare trying to sort all this out.

 

As for the CC. I disagree with you.
I look at it as a loan. If you don’t pay the full amount in time you get charged interest, and I wouldn’t be taxed using it in the UK as already taxed on the income used to repay.

Unless asked, I wouldn’t report it.

You don't need to submit proof of when the savings were earned, at the time when you file a return, only later if asked.

 

If you can show that the savings have existed for over one year, that will likely be sufficient in my book to confirm they are savings and not income. It is improbable the TRD will want to see that tax has been paid on that money, only that it is not income.

 

It is not for me to agree of disagree with your view regarding credit card transactions, only to inform what the rules are. The TRD staff in the French Embassy video interview confirmed CC transaction are regarded as assessable income, as does the UK HMRC, I'm happy you take your own view. 

[andre47]

1 hour ago, phetphet said:

In my case, the UK has a double tax treaty with Thailand, so my private pension is already taxed. But as it’s not enough to live on, I also have to bring over some savings each month. 
This is what worries me. How to prove payment of tax on savings earned over the years? How far to go back?

Why do you think that you have to prove payment of tax on savings earned over the years?

[Dogmatix]

4 hours ago, andre47 said:

Why do you think that you have to prove payment of tax on savings earned over the years?

Not on income or interest earned prior to 2024 but on all  interest earned after 31 Dec 2023.

 

Edited May 29 by Dogmatix

[Mike Lister]

43 minutes ago, Dogmatix said:

Not on income or interest earned prior to 2024 but on all  interest earned after 31 Dec 2023.

 

Some members are confused by this so just to clarify: proof of tax paid on all interest at Thai banks is confirmed by certificate issued by the banks.

[Mike Lister]

Perhaps about time to get back to basics and remember what all the kerfuffle is about!

 

Previously, anyone earning income overseas and remitting it to Thailand, whilst they were tax resident here, had to wait until the following year in order to escape Thai tax on that income.

 

Now, it doesn't matter when the money is remitted, the same year, the next year or five years later, it becomes taxable whenever it is remitted.

 

Previously, remitted savings were never taxable, exempt income was never taxable and income covered by a  DTA, was not taxable in Thailand....those things haven't changed.

 

Previously, income that was taxed overseas could be remitted to Thailand and the DTA invoked. That meant that the tax already paid overseas, could be used  to offset any Thai tax and the average net taxation effect would be very similar, in most cases. That hasn't changed.

 

Previously, foreigners who were tax resident in Thailand and who had even fairly low levels of assessable income, were always required to file a Thai tax return. That hasn't changed.

 

Previously, foreign tax residents with no assessable income in Thailand, are not required to file a Thai tax return. That hasn't changed.

 

 

 

 

 

 

[sqwakvfr]

Is this a foreign remittance?

 

1. Withdraw money from a Thai Bank ATM in LOS from my US Bank Account

2. Then deposit the money into my Thai Bank Account at an ATM Cash Deposit machine

 

On this type of transaction there is no record of any money being transfered into LOS from abroad. How would any Thai Governmental Agency know the actual money deposited into my Thai Bank account was brought in from abroad because the actual deposit would be in Baht. 

[talahtnut]

When taxi drivers and waitress's have to pay tax on tips. thats it, I'm off.

[Mike Lister]

6 minutes ago, sqwakvfr said:

Is this a foreign remittance?

 

1. Withdraw money from a Thai Bank ATM in LOS from my US Bank Account

2. Then deposit the money into my Thai Bank Account at an ATM Cash Deposit machine

 

On this type of transaction there is no record of any money being transfered into LOS from abroad. How would any Thai Governmental Agency know the actual money deposited into my Thai Bank account was brought in from abroad because the actual deposit would be in Baht. 

Yes, it's considered to be a foreign remittance.

 

There's a technical explanation how the TRD will know but explaining it attracts heated arguments so I won't bother. Suffice to say, if those ATM transactions are only periodic and are limited in size, I doubt they would be an issue.

[UKresonant]

24 minutes ago, sqwakvfr said:

Is this a foreign remittance?

 

1. Withdraw money from a Thai Bank ATM in LOS from my US Bank Account

2. Then deposit the money into my Thai Bank Account at an ATM Cash Deposit machine

 

On this type of transaction there is no record of any money being transfered into LOS from abroad. How would any Thai Governmental Agency know the actual money deposited into my Thai Bank account was brought in from abroad because the actual deposit would be in Baht. 

Depends on the ratio of your declared funds vs your suggestion, how obvious it may be, once you re deposit it. 

 

How many times could you say you emptied th saving jar. 

 

Then the potential suspicion of working.

 

It's the redeposit bit, if similar, that is the snag.

 

 

[sqwakvfr]

2 hours ago, Mike Lister said:

Yes, it's considered to be a foreign remittance.

 

There's a technical explanation how the TRD will know but explaining it attracts heated arguments so I won't bother. Suffice to say, if those ATM transactions are only periodic and are limited in size, I doubt they would be an issue.

How would they know?  The only way I can see is that the Thai Government would have to flag or monitor all ATM withdraws with foreing bank debit cards.  So if allegedly 20,000,000 to 30,000,000 tourist come into LOS per year and spend money that is a lot of transactions.  But who knows because this is "Amazing Thailand" after all. 

[Mike Lister]

Just now, sqwakvfr said:

How would they know?  The only way I can see is that the Thai Government would have to flag or monitor all ATM withdraws with foreing bank debit cards.  So if allegedly 20,000,000 to 30,000,000 tourist come into LOS per year and spend money that is a lot of transactions.  But who knows because this is "Amazing Thailand" after all. 

The only issue is whether it is or is not, the mechanics of how and the odds of detection are nothing we get involved in.

[sqwakvfr]

1 hour ago, UKresonant said:

Depends on the ratio of your declared funds vs your suggestion, how obvious it may be, once you re deposit it. 

 

How many times could you say you emptied th saving jar. 

 

Then the potential suspicion of working.

 

It's the redeposit bit, if similar, that is the snag.

 

 

Could you imagine being questioned by a Thai Immigration Officer "you must be working because in the last 6 months you have deposited 10,000 per month into your account every month?"  Also, this could  mean banks are reporting the bank transactions of foreign account holders???? Maybe or maybe not.  This entire "tax foregn income" concept might have some unintended consequnces.  As always in LOS: Do first, think later. 

[sqwakvfr]

2 minutes ago, Mike Lister said:

The only issue is whether it is or is not, the mechanics of how and the odds of detection are nothing we get involved in.

"The Devil is always in the details". 

[JohnnyBD]

6 hours ago, Mike Lister said:

Perhaps about time to get back to basics and remember what all the kerfuffle is about!

 

Previously, anyone earning income overseas and remitting it to Thailand, whilst they were tax resident here, had to wait until the following year in order to escape Thai tax on that income.

 

Now, it doesn't matter when the money is remitted, the same year, the next year or five years later, it becomes taxable whenever it is remitted.

 

Previously, remitted savings were never taxable, exempt income was never taxable and income covered by a  DTA, was not taxable in Thailand....those things haven't changed.

 

Previously, income that was taxed overseas could be remitted to Thailand and the DTA invoked. That meant that the tax already paid overseas, could be used  to offset any Thai tax and the average net taxation effect would be very similar, in most cases. That hasn't changed.

 

Previously, foreigners who were tax resident in Thailand and who had even fairly low levels of assessable income, were always required to file a Thai tax return. That hasn't changed.

 

Previously, foreign tax residents with no assessable income in Thailand, are not required to file a Thai tax return. That hasn't changed.

 

 

 

 

 

 

Very good summary of the current situation... Good job...

[unblocktheplanet]

On 5/20/2024 at 4:16 PM, Dogmatix said:

 

I don't think they have the resources to step up resources.  Their inspectors apparently have quite a backlog already. 

Yes, but I bet they will target farang, business as usual. 

[Mike Lister]

6 minutes ago, unblocktheplanet said:

Yes, but I bet they will target farang, business as usual. 

Foreigners are not the target, middle class Thai's with overseas accounts are.

[unblocktheplanet]

On 5/23/2024 at 4:16 PM, Dogmatix said:

The question of whether withholding tax would be deducted from foreign remittances was asked in the French embassy video and the French speaking RD lady said, "Fortunately not".

Does this mean that I can transfer / remit from my foreign bank account created pre-2024 without the 15% tax? I presume I don't have to file as I live off savings.

[unblocktheplanet]

On 5/24/2024 at 5:29 PM, Mike Lister said:

All savings accounts are subject to 15% with holding tax, some banks will not deduct the tax, for the first 20k of interest earned, as along as you show them your Tax ID card.

Does the include the 800k required to extend retirement visas?

[Mike Lister]

31 minutes ago, unblocktheplanet said:

Does the include the 800k required to extend retirement visas?

Of course, it's just another deposit isn't it?

[Dogmatix]

14 hours ago, talahtnut said:

When taxi drivers and waitress's have to pay tax on tips. thats it, I'm off.

 

Tips are income and taxi drivers and waitresses should declare them.  So you may leave now.

[Dogmatix]

There was an article in today's Post which I am not allowed to link about tax refunds delayed by false submissions.  You can search for it yourselves, if interested.  The problem is apparently too many people claiming tax refunds based on fake 50 bis forms.  50 bis is the form an employer gives you stating the total amount of income paid and tax deducted in the year.  You submit with a paper tax return or after an online one, if you have income from employment. The article said there were 11.9m PIT tax return forms filed for 2023 of which 4.25m were claims tax refunds.  I guess the fraudsters made up their own 50 bis forms understating their income to get them below the threshold and therefore get a refund of tax deducted by their employers.  Seems quite easy to get caught, since the company also files a copy of the 50 bis form direct to the RD but it must require tedious cross checking by the RD of all tax returns of employees just below the tax threshold with allowances. They say they will solve the problem next year but refusing to accept paper 50 bis forms from companies next year, so the correct salary and tax deduction can pop up automatically in tax payer files. 

 

In our context the implications are that the RD is now wary of Thais forging domestic documents to evade tax.  When they come to look at evidence of pre-2024 income and foreign tax payments they are likely to be quite demanding in terms of verification, since they know that things like pdf files can be easily tweaked or completely forged. 

[rattlesnake]

On 5/26/2024 at 8:50 AM, Dogmatix said:

 We might wait a long time for the redesigned PND 90 tax return form with the spaces to claim tax credits.  Tax credits have already been claimed under DTAs without a new form, so they may not feel a strong compulsion.  PND 90 only covers income from employment.  So they would also need to redesign PND 91 covering income from other sources.

 

Since it is unclear whether foreign state pensions are considered income from employment, which technically they are not, or income from other sources Or perhaps are not assessable at all like the Thai old age allowance).  If they are considered income from other sources state pension income should be reported on the PND 90 tax return which is more detailed and complicated to file than PND 91.  Anyone who remits post-2024 interest or dividend income or cap gains & etc will have to fill in PND 91 anyway.

 

Whether income, including state pensions, are considered PND 91 or 90 affects the threshold for filing a tax return.  If it is PND 91 (income from employment only) the threshold for tax filing is 120k but, if it is PND 90, it is 60k only.   

 

Sorry for my ignorance, but is that 120k per month?

[topt]

2 minutes ago, rattlesnake said:

 

Sorry for my ignorance, but is that 120k per month?

No - an annual (calendar year) figure

[stat]

17 hours ago, Mike Lister said:

Yes, it's considered to be a foreign remittance.

 

There's a technical explanation how the TRD will know but explaining it attracts heated arguments so I won't bother. Suffice to say, if those ATM transactions are only periodic and are limited in size, I doubt they would be an issue.

I am not a 100% sure it is considered a remittance. I think it might be classified as a remittance but it is far from sure. There was one representative of TRD who said so but no one knows for sure IMHO.

Edited May 30 by stat

[Middle Aged Grouch]

Time to close the bank accounts here for those who only come in during the winter months.

[UKresonant]

4 hours ago, Mike Lister said:

Foreigners are not the target, middle class Thai's with overseas accounts are.

Yes it's put a quite spanner in the works for retirement planing....

[UKresonant]

42 minutes ago, Middle Aged Grouch said:

Time to close the bank accounts here for those who only come in during the winter months.

I'll be keeping mine as long as they let me!

[topt]

8 hours ago, Middle Aged Grouch said:

Time to close the bank accounts here for those who only come in during the winter months.

Why?

If you are here for less than 180 days in a calendar year then you are not affected........

[Dogmatix]

10 hours ago, Middle Aged Grouch said:

Time to close the bank accounts here for those who only come in during the winter months.

Definitely not a good idea to close bank accounts, if you don’t even stay long enough to be tax resident. They are making it harder to open accounts and you might find you need one in future but can’t get one. When they first introduced money laundering laws banks blocked the opening of accounts by foreigners without work permits completely for over a year. It could happen again. I had permanent residence but no work permit at the time and Bangkok Bank actually tried to close my existing account until I called someone in HQ and persuaded him that farangs with PR actually ranked a lot higher in the picking order than farangs on temporary visas with WPs.

Edited May 31 by Dogmatix

[stat]

16 hours ago, Middle Aged Grouch said:

Time to close the bank accounts here for those who only come in during the winter months.

Why would you want to close your account instead of keeping the balance close to zero? I assume the cost is not too high for keeping the account alive.