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

[Mike Teavee]

2 hours ago, Presnock said:

Agree.  I have lived in Thailand more than 30 years total.  Been through a lot of coups.  But one of the biggest complaints by expats is the immigration - Many changes have been made since I retired here in 2005 and got Retirement O visa.   At one time we would have to arrive at CM immigration (some more than 8 hours) but at least 4 hours of waiting in a queue just to get a queue number for the same day.  After getting the queue number, when they broke at lunch they would advise that some that had been waiting hours, that they needed to come back the following day.  Used to have to show up for the 90-day report, now on line.  Used to have a TM 28 for expat to show a move to differentt location; they stopped that and then made the expat responsible mostly for the TM30 and now that too can be done on line.  New visas have shown up - many just this year.  Glad the LTR came up and not so many signed on so they dropped the price by 50% (50K baht!).  Then the OECD agreement of July 2023 and taxes changed and possibly to change even more.  Elections  last year and now 2 PM's gone, possbly a third but all in all, Thailand remains a great place for my retirement.  By switching to LTR no more 90-day reports for the next 10 years.  Food remains great here with even more variety no matter what kind of food one likes,.  Used to be no western foods as all except one Villamart. Baht has changed too over the years and we get a better rate now than we used to but not as good as the late 90's.

All in all, still a paradise for me and my family.  Schooling for daughter going well and a lot cheaper and if she so desires, she can get a great paying job in the US or elsewhere.  Weather too is changing but no one controls that but I did hear on the US news broadcast this morning that the MAGA crowd is claiming that the DEMS are controlling the weather so that Republican states are suffering these horrendous hurricanes.  (I am not joking, I saw several US news (YOUTUBE) broadcasts this morning.)  For those looking to move, I read this morning that Panama is a tax haven and the weather is great too.

I'm a Brit so not the same at all but I loved the part where you said "I have lived in Thailand more than 30 years total".

 

I truly hope that one day I can say the same (I'm only 5 years in)

 

Fck this Tax <deleted>  it is not going to stop me from living in my chosen country - Adapt & Overcome 🙂 

 

 

Top marls to you 🙂

 

 

[chiang mai]

3 minutes ago, Yumthai said:

I'm not suggesting, just read Thai gift rules it's pretty straightforward. The intention or purpose behind the gift is never mentioned in the Law.

 

Gifting relatives is very common in Thailand. For instance, Thai nationals residing abroad (can) send regularly money to their parents/kids in Thailand, legally tax-free (under 20M THB/ year) for the receiver.

 

But the rule does mention the Gift being made in line with tradition  or on special occasions, which must be self evident.

[Yumthai]

1 minute ago, chiang mai said:

But the rule does mention the Gift being made in line with tradition  or on special occasions, which must be self evident.

 

Including maintain and support ascendants/descendants/spouse.

[jayboy]

2 hours ago, Phulublub said:

If one travels regularly, one could easily (and legally) bring in a large quantity of cash each trip and exchange here (using a local Thai friend if necessary) to leave absolutely no paper trail of remitted funds on which you might be taxed.  The remittance is legal, the exchange mechanism dubious, the non reporting (if assessable income) illegal...  individuals will, as ever, choose their own path.

 

 

I wouldn't dream of using a mechanism as you have described to avoid paying Thai income tax. Not only would it be a criminal offense (I think), but it would also be clear tax evasion, and would open one up to blackmail in some circumstances.However my particular point here, as previously suggested, is that there is a spectrum of risk from the unacceptable to the mildest/non existent.Of course the main concern is what is correct procedure by Thai tax law but I don't think we should arbitrarily dismiss discussion of ways to mitigate tax.

 

The foreign credit card example is significant because it is not even clear whether it's use breaches any tax regulation.The hypothetical situation is that a foreigner who is a Thai tax resident pays for overseas airfares on an international web site with a foreign credit card and then settles the subsequent bill with offshore funds.

 

 

[Mike Teavee]

3 minutes ago, Yumthai said:

I'm not suggesting, just read Thai gift rules it's pretty straightforward. The intention or purpose behind the gift is never mentioned in the Law.

 

Gifting relatives is very common in Thailand. For instance, Thai nationals residing abroad (can) send regularly money to their parents/kids in Thailand, legally tax-free (under 20M THB/ year) for the receiver.

 

 

Again OP asked the question and didn't mention anything about gifts to relatives, so I answered as best possible. 

 

I "Gift" my GF 49,999 for her birthday (Fun fact Krungsri Bank is one of those where 50K is too much) same again  at Christmas... Am I "Remitting money" to her (Probably) would I report it (Hell no)... It's her account she can do as she pleases

 

 

[Surasak]

When will information on taxes for eligible foreigners be updated? this thread is 5 month old, it beginning to grow hairs.

[chiang mai]

7 minutes ago, Surasak said:

When will information on taxes for eligible foreigners be updated? this thread is 5 month old, it beginning to grow hairs.

Everyone is waiting for the release of the new tax forms and the associated instructions, I understand that is scheduled for November or December.

[Phulublub]

51 minutes ago, jayboy said:

 

The hypothetical situation is that a foreigner who is a Thai tax resident pays for overseas airfares on an international web site with a foreign credit card and then settles the subsequent bill with offshore funds.

 

 

To suggest that this might be under the auspices of Thailand is ridiculous and no-one has suggested it would be and continued discussion on this outlier would be fruitless.  A (perhaps) better example and one that is much more likely to be widespread is as follows:

 

1.  I transfer money from my UK Bank account to my Tha account.  I then buy a widget using cash I have withdrawn.

 

2. I buy a widget and pay for it using my UK Credit Card.  Later I clear my UK CC account unsing my UK Bank account.  (I do this myself a lot when buying on Lazada)

 

In both cases, money has been transferred to Thailand and the relevant information as far as tax liability is concerned is the source of the funds in the bank account.  That's it.

 

PH

[Presnock]

1 hour ago, Mike Teavee said:

I'm a Brit so not the same at all but I loved the part where you said "I have lived in Thailand more than 30 years total".

 

I truly hope that one day I can say the same (I'm only 5 years in)

 

Fck this Tax <deleted>  it is not going to stop me from living in my chosen country - Adapt & Overcome 🙂 

 

 

Top marls to you 🙂

 

 

Yeah, I lived and worked around the world, many countries and kept a log on the good and bad things in each place.  Thailand ranked at the top as retirement came along and PI was a close 2nd, I spent 6 years there too, loved it especially since I am a scuba diver did advanced open water there near the old US naval base.  But although warm weather only, i didn't like the number of typhoons, earthquakes (big ones), volcanic eruptions - there during Pinatubo, near Manila), and the food was not a whole lot to my liking unlike that here.  I plan to spend my final years here and have thought the same since I arrived.  I did live at first in BKK but the traffic got to me so moved to CM due to schools for daughter.   Not a fan of pollution but we own a house there in a 100 house mooban and are renting a house in BKK where our daughter is going to college.  WIfe has indicated that we might have to travel on those worse months - daughter may be in Seoul for graduate study so might check that out during the worse months.  Anyway, you won't won't read many negative notes about Thailand from me.  Hope you get to stay as long as you want.  Maybe when the go to worldwide income taxation (if they do) they might do as the PI and not taxes on retirees unless working in country.  Good luck and have a good one.

[Lorry]

1 hour ago, Yumthai said:

Gifting relatives is very common in Thailand. For instance, Thai nationals residing abroad (can) send regularly money to their parents/kids in Thailand, legally tax-free (under 20M THB/ year) for the receiver

 How do you know this is very common?

The question whether this is common has come up many times in the tax threads,  i never saw an answer. 

I don't doubt what you say, just interested how you know. 

[chiang mai]

4 minutes ago, Phulublub said:

To suggest that this might be under the auspices of Thailand is ridiculous and no-one has suggested it would be and continued discussion on this outlier would be fruitless.  A (perhaps) better example and one that is much more likely to be widespread is as follows:

 

1.  I transfer money from my UK Bank account to my Tha account.  I then buy a widget using cash I have withdrawn.

 

2. I buy a widget and pay for it using my UK Credit Card.  Later I clear my UK CC account unsing my UK Bank account.  (I do this myself a lot when buying on Lazada)

 

In both cases, money has been transferred to Thailand and the relevant information as far as tax liability is concerned is the source of the funds in the bank account.  That's it.

 

PH

Do you agree with this?

 

1 - the person must be Thai tax resident

 

2 - the transaction must benefit the cardholder for personal income tax rules to apply (as opposed to any Gift Tax aspect).

 

3 - the merchant/payee must be based in Thailand, unless overseas goods or services are acquired that are shipped to or have their end point in Thailand.

 

4 - the funds used (to pay the bill) must be Thai assessable and not exempt

 

Where the rules may diverge is if a credit card liability is converted to another form of loan. A credit card transaction is variable limit, revolving credit agreement whereas  personal loans are fixed and for a specific purpose, typically of a fixed duration. But that aspect is downstream and not really part of the today discussion about credit card transactions.

 

Also, I think the fact the purchase is made using revolving credit is a red herring. Subject to the above rules, the contract is formed in Thailand, there is offer, acceptance and consideration in Thailand, the merchant is paid here and the CC card holder receives delivery of their product or services here. This differs significantly from a foreign bank loan, to say purchase a condominium in Thailand where there is a fixed loan agreement and the purchase is for a specific item and there is a dedicated loan agreement.

 

Some  Examples 

 

A Thai tax resident uses his UK bank CC to buy a sports car which is then shipped to Thailand. Depending on the nature of the funds used to pay the CC bill, the funds used to make the purchase may be assessable to Thai tax.

 

A Thai tax resident uses his foreign CC to pay his rent in Thailand every month. Depending on the nature of the etc etc etc (as above).

 

A Thai tax resident uses his foreign CC to purchase an overseas package holiday, via a Thai based travel agent. Depending on.... (as above)

 

Same as above but the travel agent is located in the UK. Those funds are never remitted to Thailand so cannot be regarded as Thai tax assessable.

 

A Thai tax resident uses his foreign CC to purchase a Gift from overseas, for his Thai resident spouse. which is then shipped directly to his partner here. The present can be considered under Thai Gift Tax rules which means the partner has no potential tax liability. But the purchaser of the Gift still needs to consider the nature of the funds used to pay the CC bill.  If they are Thai tax assessable, he is liable to tax on that purchase, in the same way that he would had he remitted assessable income to his spouse.

 

Same as above but the overseas spouse is now just an overseas "anyone" and the gift, purchased overseas, is shipped directly to them overseas. Neither the gift nor any funds are remitted directly to Thailand plus there is no personal consideration, ergo, the cost of the gift is neither  tax assessable in Thailand nor applicable under Thai Gift Tax rules.

[Phulublub]

13 minutes ago, chiang mai said:

A Thai tax resident uses his UK bank CC to buy a sports car which is then shipped to Thailand. Depending on the nature of the funds used to pay the CC bill, the funds used to make the purchase may be assessable to Thai tax.

 

A Thai tax resident uses his foreign CC to pay his rent in Thailand every month. Depending on the nature of the etc etc etc (as above).

 

A Thai tax resident uses his foreign CC to purchase an overseas package holiday, via a Thai based travel agent. Depending on.... (as above)

 

Same as above but the travel agent is located in the UK. Those funds are never remitted to Thailand so cannot be regarded as Thai tax assessable.

1.  What?  A foreign purchase using a foreign card has nothing whatever to do with tax in any country.  Spending is not taxed (on an individual. VAT or Sales Tax may be applied to purchases but these are done at time of purchase).  The sports car will likely atract hefty import taxes/duties, but that is another matter.

 

2.  Yes.  Funds are remitted to Thailand.  What they are used for is immaterial

 

3.  Yes.  Funds are remitted to Thailand. What they are used for is immaterial.

 

4.  Same as 1.  To suggest that just because I live here does not mean and and all worldwide transactions could give rise to Thai tax implications is bizarre.

 

PH

[Thingamabob]

57 minutes ago, chiang mai said:

Everyone is waiting for the release of the new tax forms and the associated instructions, I understand that is scheduled for November or December.

I guess this answers the question I put to you earlier to which you didn't reply. Thanks anyway.

[chiang mai]

4 minutes ago, Thingamabob said:

I guess this answers the question I put to you earlier to which you didn't reply. Thanks anyway.

No, I did answer, you just didn't see it. Here it is again.

 

"Yes, it became effective 1 January this year".

[chiang mai]

20 minutes ago, Phulublub said:

1.  What?  A foreign purchase using a foreign card has nothing whatever to do with tax in any country.  Spending is not taxed (on an individual. VAT or Sales Tax may be applied to purchases but these are done at time of purchase).  The sports car will likely atract hefty import taxes/duties, but that is another matter.

 

2.  Yes.  Funds are remitted to Thailand.  What they are used for is immaterial

 

3.  Yes.  Funds are remitted to Thailand. What they are used for is immaterial.

 

4.  Same as 1.  To suggest that just because I live here does not mean and and all worldwide transactions could give rise to Thai tax implications is bizarre.

 

PH

Yes, number 1 is my error, I don't know what scenario I was trying to portray when I wrote that, obviously too early in the morning! Apologies.

 

Number 4 is not tax assessable, as stated.

[Thingamabob]

3 minutes ago, chiang mai said:

No, I did answer, you just didn't see it. Here it is again.

 

"Yes, it became effective 1 January this year".

Sorry about that, and thanks. 

[Yumthai]

3 hours ago, Lorry said:

 How do you know this is very common?

The question whether this is common has come up many times in the tax threads,  i never saw an answer. 

I don't doubt what you say, just interested how you know. 

First-hand observation. I'm here since two decades and live among Thai people. They constantly transfer money to each others locally and internationally for those with family/friends overseas.

[Mike Teavee]

3 hours ago, Presnock said:

Yeah, I lived and worked around the world, many countries and kept a log on the good and bad things in each place.  Thailand ranked at the top as retirement came along and PI was a close 2nd, I spent 6 years there too, loved it especially since I am a scuba diver did advanced open water there near the old US naval base.  But although warm weather only, i didn't like the number of typhoons, earthquakes (big ones), volcanic eruptions - there during Pinatubo, near Manila), and the food was not a whole lot to my liking unlike that here.  I plan to spend my final years here and have thought the same since I arrived.  I did live at first in BKK but the traffic got to me so moved to CM due to schools for daughter.   Not a fan of pollution but we own a house there in a 100 house mooban and are renting a house in BKK where our daughter is going to college.  WIfe has indicated that we might have to travel on those worse months - daughter may be in Seoul for graduate study so might check that out during the worse months.  Anyway, you won't won't read many negative notes about Thailand from me.  Hope you get to stay as long as you want.  Maybe when the go to worldwide income taxation (if they do) they might do as the PI and not taxes on retirees unless working in country.  Good luck and have a good one.

 

I love reading about people's lives like this, so thank you for sharing... I know we're on a Tax thread so probably shouldn't be getting into this sort of stuff, but I really did enjoy reading that so thanks again... 🙂 

[Lorry]

4 hours ago, Phulublub said:

1.  What?  A foreign purchase using a foreign card has nothing whatever to do with tax in any country.  Spending is not taxed (on an individual. VAT or Sales Tax may be applied to purchases but these are done at time of purchase).  The sports car will likely atract hefty import taxes/duties, but that is another matter.

 

2.  Yes.  Funds are remitted to Thailand.  What they are used for is immaterial

 

3.  Yes.  Funds are remitted to Thailand. What they are used for is immaterial.

 

4.  Same as 1.  To suggest that just because I live here does not mean and and all worldwide transactions could give rise to Thai tax implications is bizarre.

 

PH

Sounds plausible.

 

About air tickets out of Thailand: 

Using a foreign CC to buy a ticket originating in BKK from TG in BKK or from EK in BKK   = taxable remittance, case 3.

Using a foreign CC to buy a ticket originating in BKK from EK in London or from TG in London = no taxable remittance, case 4.

 

It would be nice to know whether TRD agrees to this,  but they will probably never tell us.

[offset]

I think that I understand that tax position is it that any money earned and brought into Thailand is taxable

 

What if I state that I only bring into Thailand the amount of earnings that is covered by my tax allowance and the rest of the money is from my savings from before 2024 would this mean I will not have to pay tax 

Edited October 12 by offset

[Phulublub]

38 minutes ago, offset said:

I think that I understand that tax position is it that any money earned and brought into Thailand is taxable

 

What if I state that I only bring into Thailand the amount of earnings that is covered by my tax allowance and the rest of the money is from my savings from before 2024 would this mean I will not have to pay tax 

You can certainly state that - I will be doing much the same, but with the addition of non-assessable income (Government pension).  BUT I have statements of my assets as at 31 Dec 23 and will be maintaining records of what I transfer so, if I am ever audited by TRD will be able to clearly show that my stance is correct, legal and I have no tax to pay.

 

PH

[offset]

3 minutes ago, Phulublub said:

You can certainly state that - I will be doing much the same, but with the addition of non-assessable income (Government pension).  BUT I have statements of my assets as at 31 Dec 23 and will be maintaining records of what I transfer so, if I am ever audited by TRD will be able to clearly show that my stance is correct, legal and I have no tax to pay.

 

PH

If I bring less than my allowance will I be able to claim tax back from my savings in Thailand 

Edited October 12 by offset

[Phulublub]

7 minutes ago, offset said:

If I bring less than my allowance will I be able to claim tax back from my savings in Thailand 

If you obtain a TIN and file a return, then yes.

 

PH

[ukrules]

13 hours ago, RupertIII said:

Thai individuals or Thai juristic persons or foreign individuals who are resident in Thailand according to the immigration law, which inheriting assets located in Thailand and outside the country.

 

Noteworthy as in the context of immigration when they speak of residency I believe they are talking about 'permanent residents' but who knows really....

 

It specifically does not state 'tax resident' there.

Edited October 12 by ukrules

[KhunHeineken]

9 hours ago, Lorry said:

 How do you know this is very common?

The question whether this is common has come up many times in the tax threads,  i never saw an answer. 

I don't doubt what you say, just interested how you know. 

It's well known that the Thai diaspora is quite large.

 

2016 stats, but even then, 1.1 million Thai's working / living abroad. 

 

https://en.wikipedia.org/wiki/Overseas_Thai

 

Plenty on the net about it.  This was at the top of the page of a quick Google search. 

 

1.1 million people out of around 70 million people may not sound like a lot, but picture a lot of that 1.1 million people sending money back to Thailand every week /  month from working in the west and it's considerable remittances. 

[KhunHeineken]

9 hours ago, Presnock said:

Yeah, I lived and worked around the world, many countries and kept a log on the good and bad things in each place.  Thailand ranked at the top as retirement came along and PI was a close 2nd, I spent 6 years there too, loved it especially since I am a scuba diver did advanced open water there near the old US naval base.  But although warm weather only, i didn't like the number of typhoons, earthquakes (big ones), volcanic eruptions - there during Pinatubo, near Manila), and the food was not a whole lot to my liking unlike that here.  I plan to spend my final years here and have thought the same since I arrived.  I did live at first in BKK but the traffic got to me so moved to CM due to schools for daughter.   Not a fan of pollution but we own a house there in a 100 house mooban and are renting a house in BKK where our daughter is going to college.  WIfe has indicated that we might have to travel on those worse months - daughter may be in Seoul for graduate study so might check that out during the worse months.  Anyway, you won't won't read many negative notes about Thailand from me.  Hope you get to stay as long as you want.  Maybe when the go to worldwide income taxation (if they do) they might do as the PI and not taxes on retirees unless working in country.  Good luck and have a good one.

Times are changing, and so are countries. 

 

Expats need to be adaptable, or, accept they may have to pay more, in the way of tax, to continue to reside in their chosen retirement destination county. 

[Presnock]

11 hours ago, Mike Teavee said:

 

I love reading about people's lives like this, so thank you for sharing... I know we're on a Tax thread so probably shouldn't be getting into this sort of stuff, but I really did enjoy reading that so thanks again... 🙂 

Nomad website indicates that Panama is a "Tax Haven", and the weather is nice too.

[Lorry]

7 hours ago, KhunHeineken said:

Thai's working / living abroad. 

... sending money back to Thailand every week /  month from working in the west

Not criticizing your post, just stumbling over how their AI equates (supposedly rich) "abroad" with "the West" (wherever that may be - Korea?).

Talk about AI bias.

[Lorry]

13 hours ago, Yumthai said:

First-hand observation. I'm here since two decades and live among Thai people. They constantly transfer money to each others locally and internationally for those with family/friends overseas.

I know Thais who receive money from family overseas. 

The amounts are hardly taxable,  no need to apply gift tax rules if remitting several hundred thousands a year to your pennyless parents in the village. 

 

I don't know Thais who get millions per year from abroad and how they handle their taxes. 

Are you talking about this kind of people?

 

[Yumthai]

8 minutes ago, Lorry said:

I don't know Thais who get millions per year from abroad and how they handle their taxes. 

These ones use workarounds to mitigate their tax liability (up to 0).