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

[CharlieKo]

4 hours ago, chiang mai said:

In other words, does the tax system allow individuals to make their own calculations  about whether or not tax is due and lets them decided whether or not to file a return, on the basis of their own findings? e.g. I calculate no tax is due ergo I don't have to file.

 

That is right. The tax system is an honour system. They trust you to make the right deductions. If they have any doubts they will audit you and go through your accounts for up to 10 years. If you are found to be cheating then you will get a hefty fine, maybe prison time. Maybe kicked out the country? 

 

As for a link. I don't have one. It's what I've read on various websites. You might find such info on the Thai Tax Revenue's website?   

[chiang mai]

Just now, CharlieKo said:

 

That is right. The tax system is an honour system. They trust you to make the right deductions. If they have any doubts they will audit you and go through your accounts for up to 10 years. If you are found to be cheating then you will get a hefty fine, maybe prison time. Maybe kicked out the country? 

 

As for a link. I don't have one. It's what I've read on various websites. You might find such info on the Thai Tax Revenue's website?   

Thanks, that sounds like a very plausible answer, plus it was civil too.

[chiang mai]

If the tax system is based on honor, which I believe most self reporting systems are, it doesn't matter whether you file or not, you are open to the same scrutiny. If you did file, the return can be accepted or it can be queried. If you didn't file, the fact that you didn't can be accepted as being there wasn't a need, or, it can be queried. And if it is queried and you didn't file when according to the rules you should have filed, even though there was no tax to pay, you leave yourself open to penalties. Is that pretty much what the correct answer is?

[NoDisplayName]

4 hours ago, chiang mai said:

The question I posed, which still hasn't been answered, is this:

 

The person has assessable income, above the level required to file a tax return but below the level of having to pay tax, once that person's view of the relevant TEDA is taken into account.

 

 

 

There is no official answer yet, but that doesn't really matter, as each local tax office will interpret any grey areas in the rules in their own unique way.  Most reports of in-person visits indicate TRD official says not to file.

 

You seem to be concerned, so just go handle it.  File a null return and relax.  It's fast, it's easy, it's free.

 

March down to your local tax office and demand a TIN if you don't have a pink ID.  Bring your fixed account passbook(s) as evidence to show you NEED to file a return to get several thousand baht in withheld interest refunded.

 

Get your tax number registered in the online system by the provincial tax office.

 

Link your bank account to PromptPay, can be done online with Bangkok Bank.  TRD no longer sends refund checks, PromptPay only.  You may need to open a KrungThai account to receive PromptPay if your bank link uses your mobile number and not your pink ID.

 

Go home and spend fifteen minutes every March filing a null tax return.  A few days later, download the accepted tax return and the official receipt.

[chiang mai]

1 minute ago, NoDisplayName said:

 

There is no official answer yet, but that doesn't really matter, as each local tax office will interpret any grey areas in the rules in their own unique way.  Most reports of in-person visits indicate TRD official says not to file.

 

You seem to be concerned, so just go handle it.  File a null return and relax.  It's fast, it's easy, it's free.

 

March down to your local tax office and demand a TIN if you don't have a pink ID.  Bring your fixed account passbook(s) as evidence to show you NEED to file a return to get several thousand baht in withheld interest refunded.

 

Get your tax number registered in the online system by the provincial tax office.

 

Link your bank account to PromptPay, can be done online with Bangkok Bank.  TRD no longer sends refund checks, PromptPay only.  You may need to open a KrungThai account to receive PromptPay if your bank link uses your mobile number and not your pink ID.

 

Go home and spend fifteen minutes every March filing a null tax return.  A few days later, download the accepted tax return and the official receipt.

Thanks for all of that but I have had a TIN for many years and have filed returns, on and off, for almost 15 years. I was trying to understand if there was an "official" answer, just to fill in the gaps in my understanding. But yes, the overhead of filing when its not strictly necessary, isn't a great hardship or draw on anyone's time, better safe than sorry and all that.

[NoDisplayName]

1 minute ago, chiang mai said:

Thanks for all of that but I have had a TIN for many years and have filed returns, on and off, for almost 15 years. I was trying to understand if there was an "official" answer, just to fill in the gaps in my understanding. But yes, the overhead of filing when its not strictly necessary, isn't a great hardship or draw on anyone's time, better safe than sorry and all that.

 

Don't worry about "official" answers.  They may never come.

 

Cover your butt as you feel necessary to feel comfortable.

 

Now you can head over to the worldwide tax threads for some serious doom porn!

[stat]

On 9/28/2024 at 3:35 AM, oldcpu said:

 

I am curious about this, as a (very small) part of my different pensions comes from Germany.

 

I struggle sometimes with the wording of "a Contracting State" and "other Contracting State" in the DTA (for example in the DTA between Germany and Thailand).

 

Further to that example, if I read Article-18 in the German/Thai DTA, para-2, and when at first I tried to fill in 'Germany' (or 'Thailand' ) in place of 'a contracting state' or in place of 'other contracting state', at first I incorrectly read:

 

(2) Notwithstanding the provision of (1) pensions and other payments for past employment created by Germany (ie a contracting state) shall be exempt from tax in Thailand (ie 'other contracting state').

 

Clearly that is inconsistent with what you have determined - and I then checked again. 

 

I note in para(1) of Article-18 of the Thai/German DTA "a contracting state" is referred to the one in which one is a resident.  ... so it could be at first I confused "a contracting state" with "other contracting state" ...   ie is it instead maybe it is saying

 

(1) Pensions and other payments for past employment .... derived by a resident of Thailand (ie a contracting state) may be taxed in Germany (the other contracting state) only if such payments are deducted as expenses in determining the profits of an enterprise of Germany (the other contracting state) ...

(2) Notwithstanding the provision of (1) pensions and other payments for past employment created by Thailand  (ie a contracting state where one is resident) shall be exempt from tax in Germany (ie 'other contracting state').

 

And if that second example is the case, then the DTA talks about Thailand pensions (for German pension recipients who reside in Thailand) and says nothing (ie and saying nothing it provides no DTA protections) about Thailand taxing German pensions , but rather only infers Germany won't tax the German pensions of those abroad from Germany who derive German pensions.  So with no protections, Thailand could tax such if they wished.

 

I almost wonder if it would be useful for a separate thread for expats who derive income from different countries ... where such could be hashed out.

 

TH has currently the right to tax the gov. pension and I assume they will IF you remit to TH. Are you getting gov. pension or company pension? The German IRS will sometimes try to tax all pensions but when you write to the German IRS in Neubrandenburg that deals with all expats they will relent in the end. That was the consensus of several German expats I dealt with. Do only contact German IRS if they already tax you 😉

[Lorry]

11 hours ago, chiang mai said:

The question I posed, which still hasn't been answered, is this:

 

The person has assessable income, above the level required to file a tax return but below the level of having to pay tax, once that person's view of the relevant TEDA is taken into account.

 

In other words, does the tax system allow individuals to make their own calculations  about whether or not tax is due and lets them decided whether or not to file a return, on the basis of their own findings? e.g. I calculate no tax is due ergo I don't have to file.

 

I hear the argument that the TRD doesn't want lots of null tax returns but there's another argument that this method is a get out of jail free card plus it doesn't aid tax collection. If somebody were to use that as a reason for not filing, the excuse would be, "Oh, sorry, I made a mistake, I thought blah blah blah". I mean, there's nothing in the instructions that says people can make this informal precursory check, whereas you might imagine there would be, at least somewhere. So is this really nothing more than presumption on our part, "we were trying to help you, we didn't think you'd want us to file if there was no tax to pay"! In fact, there is a penalty for not filing when you're supposed to, although few people think it is ever imposed.

 

I just don't know how valid all that really is. The argument that it's an informal system that relies on tradition is one option, but that's not a useful defense if TRD ever tries to quote the rule book. Something more substantial would be most helpful, not just personal opinion and emotion, regardless of which way it may point.

 

 

 

 

 

There is no official answer.

But it's not that we just think they don't  want null returns.

Many people have posted that they were actively discouraged to file null returns.  TRD in many cases said "you cannot" file a null return. This is my experience too.

Nothing in writing,  though. But a lot more than saying " you don't have to ".

[chiang mai]

9 minutes ago, Lorry said:

There is no official answer.

But it's not that we just think they don't  want null returns.

Many people have posted that they were actively discouraged to file null returns.  TRD in many cases said "you cannot" file a null return. This is my experience too.

Nothing in writing,  though. But a lot more than saying " you don't have to ".

Understood and I appreciate the explanation.

 

The last time I filed a null return was five years ago. When the woman had almost finished entering the information into the system she turned and asked, can I ask you why you're filing a return when you aren't owed any money. I hesitated slightly and before I could answer she said, with a slight smile, I think I understand why, 

 

Draw your own conclusions.

 

[oldcpu]

3 hours ago, stat said:

TH has currently the right to tax the gov. pension and I assume they will IF you remit to TH. Are you getting gov. pension or company pension? The German IRS will sometimes try to tax all pensions but when you write to the German IRS in Neubrandenburg that deals with all expats they will relent in the end. That was the consensus of several German expats I dealt with. Do only contact German IRS if they already tax you 😉

 

My pension situation is complex. 

 

I worked in Canada for 27 years paying tax to Canada then (qualifying me for a partial Canadian pension and Old Age Security), worked for a company in Germany for a bit less than 5 years paying tax to Germany then (but paid extra to Germany to get 5 year credit to qualify for a very small German pension which I now receive) and worked for a European Government organisation for 13.5 years (my tax money went to Ireland then before I retired - although I never worked in Ireland - this is a complex European organisation thing) and I now receive a pension from that European organisation.  I won't go into all its tax aspects here.

 

On the 'private' side, next year I will start receiving money from a Canadian Registered Retirement Income Fund (RRIF) (sort of like a US 401k) which will be taxed in Canada (per DTA), ...  and also some money from a private German Health insurance/pension scheme that my wife had my buy many years back (which I forgot about - and I assume taxed in Germany).

 

 

The Canadian pension and Canadian RRIF money will be taxed in Canada (per my understanding of the Thailand/Canada DTA). The German pension will be taxed (or not taxed) in accordance with the Thailand/German DTA (and in accordance with the Thailand LTR exemption on assesable income).  The private German Health Insurance pension scheme pension I assume will be taxed in Germany < not sure > Its small and I even forgot about it, until I received a letter a week ago from them reminding me ...  The European government organisation pension will be taxed or not taxed in accordance with my Thailand LTR visa.  I have always planned to have it taxed, so not being taxed by my having a Thailand LTR visa would be a nice financial perk/extra.

 

So regardless as to how this plays out, it won't affect my future plans for Thailand.   My wife is 13 years younger than myself, so my main long range financial future plan is to ensure she is looked after when I pass away (hopefully I don't pass away too soon).

Edited September 29 by oldcpu

[JimGant]

5 hours ago, stat said:

TH has currently the right to tax the gov. pension and I assume they will IF you remit to TH.

Why do you say that? The DTA says German govt pensions are exempt from Thai taxation.

Quote

Notwithstanding the provisions of paragraph 1, pensions and other payments for past employment as well as annuities paid by or out of funds created by a Contracting State, a “Land”, a political subdivision, local authority or local administration thereof shall be exempt from tax in the other Contracting State.

 

[Lorry]

5 minutes ago, JimGant said:

Why do you say that? The DTA says German govt pensions are exempt from Thai taxation.

 

Stat is right.

The problem is the wording "government pension" which doesn't fit the German pension system.

See my post Saturday 11.36 pm.

 

Most Germans call their pensions from compulsory old-age insurance "government pensions" because they are not private pensions. 

But they are not paid by the government. 

Oldcpu is talking about this kind of pension.

 

What you mean are pensions for civil servants,  paid by the government. 

[JimGant]

25 minutes ago, Lorry said:

What you mean are pensions for civil servants,  paid by the government

OK. And Stat's talking about the equivalent of US Social Security.

[KhunHeineken]

1 hour ago, Lorry said:

Stat is right.

The problem is the wording "government pension" which doesn't fit the German pension system.

See my post Saturday 11.36 pm.

 

Most Germans call their pensions from compulsory old-age insurance "government pensions" because they are not private pensions. 

But they are not paid by the government. 

Oldcpu is talking about this kind of pension.

 

What you mean are pensions for civil servants,  paid by the government. 

I agree.

 

An argument lost on many members in the Australian Forum - Old Aged Pension thread, also. 

 

Article 18 of the Thai / Australia DTA relies on the "provisions" of Article 19, and Article 19 is about "government service." pensions, not "government pensions" as in, welfare, or benefits as it's known in some European countries.  There is a difference.  

 

One member posted in the Australia Forum, and I quote, "Forget about Article 19" yet in this Forum, advised another Australian member he would have to pay tax under Article 19 of the DTA.  Go figure. 

 

Every DTA is different, yet, have a lot of similarities, particularly when it comes to pensions. 

Edited September 29 by KhunHeineken

[oldcpu]

14 hours ago, Lorry said:

There is no official answer.

But it's not that we just think they don't  want null returns.

Many people have posted that they were actively discouraged to file null returns.  TRD in many cases said "you cannot" file a null return. This is my experience too.

Nothing in writing,  though. But a lot more than saying " you don't have to ".

 

Thus far that is the sense I am starting to get as well.  They don't want more paperwork than necessary (likely IMHO as they are already overloaded with paperwork). 

 

My wife attempted to apply for a Thailand tax ID for myself, and the response she obtained from the local office of the Thai Revenue Department (TRD) was I did not need to file a tax return and hence not need a tax ID.  

 

Of course things can change, and I will continue to watch this carefully to stay compliant with Thai laws.

 

(As an aside note - this is contrary to some countries, such as Canada, where Canada want a tax return even if there will be a 'null return'.  In the case of Canada, the CRA (Canada Revenue Agency) want to make up their own mind if one has a 'null return').   However Thailand is NOT the same as Canada.

Edited September 30 by oldcpu

[chiang mai]

1 minute ago, oldcpu said:

 

Thus far that is the sense I am starting to get as well.  They don't want more paperwork than necessary (likely IMHO as they are already overloaded with paperwork). 

 

My wife attempted to apply for a Thailand tax ID for myself, and the response she obtained from the local office of the Thai Revenue Department (TRD) was I did not need to file a tax return and hence not need a tax ID.  

 

Of course things can change, and I will continue to watch this carefully to stay compliant with Thai laws.

 

(As an aside note - this is contrary to some countries, such as Canada, where they Canada want a tax return even if there will be a 'null return'.  In the case of Canada, the CRA (Canada Revenue Agency) want to make up their own mind if one has a 'null return').   However Thailand is NOT the same as Canada.

 "the response she obtained from the local office of the Thai Revenue Department (TRD) was I did not need to file a tax return and hence not need a tax ID".  

 

That sort of response from TRD staff is dangerous, unless they already understand your tax position completely. It will not be any kind of defense in the future if TRD decides to investigate some aspect of your financial affairs, I personally would not accept that sort of dismissive atitude.

[oldcpu]

3 minutes ago, chiang mai said:

 "the response she obtained from the local office of the Thai Revenue Department (TRD) was I did not need to file a tax return and hence not need a tax ID".  

 

That sort of response from TRD staff is dangerous, unless they already understand your tax position completely. It will not be any kind of defense in the future if TRD decides to investigate some aspect of your financial affairs, I personally would not accept that sort of dismissive atitude.

and if you read on, note that I also typed " ...I  will continue to watch this carefully to stay compliant with Thai laws.  "

[chiang mai]

2 minutes ago, oldcpu said:

and if you read on, note that I also typed " ...I  will continue to watch this carefully to stay compliant with Thai laws.  "

I'm certain that you will, others however may take the response as official approval to do nothing.

[JimGant]

37 minutes ago, chiang mai said:

others however may take the response as official approval to do nothing.

Taking the advice of a TRD official to do nothing -- sounds like official advice to me....

 

Come on, ****. You've been beating this subject to death for over a year now. I guess you're the kind of guy who always drives the speed limit in the fast lane -- driving the more realistic folks nuts.

Edited September 30 by ElwoodP
Name removed

[JimGant]

14 hours ago, chiang mai said:

The last time I filed a null return was five years ago. When the woman had almost finished entering the information into the system she turned and asked, can I ask you why you're filing a return when you aren't owed any money. I hesitated slightly and before I could answer she said, with a slight smile, I think I understand why, 

 

Draw your own conclusions.

She thought you were crazy?

[chiang mai]

3 minutes ago, JimGant said:

Taking the advice of a TRD official to do nothing -- sounds like official advice to me....

 

Come on, MIke. You've been beating this subject to death for over a year now. I guess you're the kind of guy who always drives the speed limit in the fast lane -- driving the more realistic folks nuts.

Huh! I think you're confused, not only about the law but also about my name!

 

Yup, lots of people drive the speed limit and obey the laws of the land, why break the habit of a lifetime.

[chiang mai]

2 minutes ago, JimGant said:

She thought you were crazy?

Nope, she understands the potential exposure of foreigner if they don't obey the rules.

[JimGant]

8 minutes ago, chiang mai said:

Huh! I think you're confused, not only about the law but also about my name!

Well, I guess there are two of you out there that filed a null tax return five years ago -- and were queried by the clerk as to why you were filing if you didn't owe taxes....

[chiang mai]

1 minute ago, JimGant said:

Well, I guess there are two of you out there that filed a null tax return five years ago -- and were queried by the clerk as to why you were filing if you didn't owe taxes....

My guess is there are lots more than just two, unless you're referring only to the ones you have heard about. But if that's the way you derive your facts, whatever turns you on.

[JimGant]

2 hours ago, chiang mai said:

That sort of response from TRD staff is dangerous, unless they already understand your tax position completely.

....and your tax position, as shown by your filled-in null tax return, is that you don't owe any taxes. What could be easier to understand? Duh.

 

But you're not, I hope, suggesting you unload all your remitted income data to the agent, and have her determine which is, and which isn't, assessable income -- which, of course, would involve her knowing your DTA's particulars -- which would be a ludicrous position to take.

 

Seems to me some guy named  **** actually did offload all his income data to TRD, to have them decipher which was, and wasn't, assessable income. I remember this distinctly because of its nonsense value.

[Rimmer]

A troll post and reply has been removed, that's enough of that please.

@JimGant

[Lorry]

I am wondering if I should file a null return every year, even if I am not a tax resident.

My local tax office is 5 minutes away, filing a return only for the WHT from interest takes 5-10 minutes. They don't check how many days I was here.

 

Advantage: an audit not more than 3 years back, that's easy. 

10 years back - I wouldn't have any documents at all anymore.

 

How frequent are these audits 10 years back?

[chiang mai]

8 minutes ago, Lorry said:

I am wondering if I should file a null return every year, even if I am not a tax resident.

My local tax office is 5 minutes away, filing a return only for the WHT from interest takes 5-10 minutes. They don't check how many days I was here.

 

Advantage: an audit not more than 3 years back, that's easy. 

10 years back - I wouldn't have any documents at all anymore.

 

How frequent are these audits 10 years back?

According to some members, filing a null return is not wanted and makes you a stupid person. But if you want to get back the tax with held on your interest, I would certainly recommend filing anyway.  The alternative is not to file, forgo the tax refund and not be stupid. All those in favour of being stupid, form an orderly line to left, anyone else can stand behind Jim.

 

Technically however, obtaining a refund is not a null return, a better term might be a return that is below the threshold to pay tax..

 

Audits are either random or are generated by specific information, there is no time formula.

Edited September 30 by chiang mai

[Mike Teavee]

Just now, chiang mai said:

According to some members, filing a null return is not wanted and makes you a stupid person. But if you want to get back the tax with held on your interest, I would certainly recommend filing anyway.  The alternative is not to file, forgo the tax refund and not be stupid. All those in favour of being stupid, form an orderly line to left, anyone else can stand behind Jim.

 

Audits are either random or are generated by specific information, there is no time formula.

I've deliberately kept my remittances to just below my TEDA (235K*) so am planning on filing an Online return next year to reclaim the withheld tax from money in my Thai Bank accounts (Approx. 7K). 

 

* Re: TEDA, apologies if this has been asked before but can I claim the 100K "Income Expenses" against Income that is derived from UK Dividends & Rental property?

[chiang mai]

1 minute ago, Mike Teavee said:

I've deliberately kept my remittances to just below my TEDA (235K*) so am planning on filing an Online return next year to reclaim the withheld tax from money in my Thai Bank accounts (Approx. 7K). 

 

* Re: TEDA, apologies if this has been asked before but can I claim the 100K "Income Expenses" against Income that is derived from UK Dividends & Rental property?

No. Dividends has its own with holding rate, as I believe property rental does.