Loan and tax for foreigners

[steph83]

Hello, my wife took out a loan 3 years ago to buy
a car. Today, I would like to close the loan by
repaying the remaining amount to be paid 
(250,000 baht). The problem is that I have
to transfer this amount from my account in Belgium.
Will I have to declare this amount in March 2025 ? 

Thanks for your reply 🙂

 

[chiang mai]

4 minutes ago, steph83 said:

Hello, my wife took out a loan 3 years ago to buy a car. 
Today, I would like to close the loan by repaying the 
remaining amount to be paid (250,000 baht). The problem
is that I have to transfer this amount from my
account in Belgium. Will I have to declare this
amount in March 2025 ? 

Thanks for your reply 🙂

 

If you are not tax resident in Thailand (180 days per tax year or more) you do not have to file a tax return and the money is not assessable to Thai tax. If you are tax resident here, you could perhaps gift the money to your wife.

[steph83]

1 minute ago, chiang mai said:

If you are not tax resident in Thailand (180 days per tax year or more) you do not have to file a tax return and the money is not assessable to Thai tax. If you are tax resident here, you could perhaps gift the money to your wife.

Thanks, i'm a tax resident here. If i understand, you aren't sure if it could be a gift.

[Lacessit]

1 minute ago, steph83 said:

Thanks, i'm a tax resident here. If i understand, you aren't sure if it could be a gift.

If your wife is Thai, it's possible you will be below the taxable thresholds. IIRC it's about 550,000 baht in various allowances.

[chiang mai]

1 minute ago, steph83 said:

Thanks, i'm a tax resident here. If i understand, you aren't sure if it could be a gift.

First things first.

 

If you are tax resident, you must determine the amount of assessable income you will have this year, that is money that is potentially taxable that you've mostly bro8ight in from overseas. As a rough guide, if you're over 65, chances are that you'll have close to 500k in deductions and allowances, before Thai tax is due. If you then factor in your car loan payment, that will tell you whether the money is taxable and must be declared.

 

If the car loan repayment does take you into taxable income territory, you might consider gifting the money to your wife. The funds would need to be documented as a gift and the money sent directly to her, from overseas. You must not benefit from the gift, in any way.

 

Gift tax is not straight forward so a little reading wont hurt.

 

https://www.pwc.com/th/en/tax/assets/thai-tax/thai-tax-booklet-2024-25.pdf

 

 

[oldcpu]

Can you prove the money was savings from before 1-Jan-2024?  (perhaps unlikely given this was for a loan you wish to pay back - but I don't know your financial details - and I do not want to make any assumptions)

 

My understanding (and others can correct me if I am wrong) is if you had the money needed to payback the loan, in a foreign account prior to 1-Jan-2024 (which the RD issued in Nov-2023), then per Paw.162 you can bring it into Thailand and it will not be taxable and possibly < unsure > not assessable.  Again - others can correct me if wrong. 

 

If it is not assessable then it need not be declared.

[oldcpu]

2 hours ago, oldcpu said:

My understanding (and others can correct me if I am wrong) is if you had the money needed to payback the loan, in a foreign account prior to 1-Jan-2024 (which the RD issued in Nov-2023), then per Paw.162 you can bring it into Thailand and it will not be taxable and possibly < unsure > not assessable.  Again - others can correct me if wrong. 

 

If it is not assessable then it need not be declared.

 

That should read:

 

Quote

 

My understanding (and others can correct me if I am wrong) is if you had the money needed to payback the loan, in a foreign account prior to 1-Jan-2024, then per Paw.162  (which the RD issued in Nov-2023) you can bring it into Thailand now and it will not be taxable and possibly < unsure > not assessable.  Again - others can correct me if wrong. 

 

If it is not assessable then it need not be declared.

 

 

apologies for the mix up in placement of the Nov-2023 date. I was using an editor on my mobile phone and mistakenly added date in wrong place in the sentence.

[steph83]

20 hours ago, oldcpu said:

Can you prove the money was savings from before 1-Jan-2024?  (perhaps unlikely given this was for a loan you wish to pay back - but I don't know your financial details - and I do not want to make any assumptions)

 

My understanding (and others can correct me if I am wrong) is if you had the money needed to payback the loan, in a foreign account prior to 1-Jan-2024 (which the RD issued in Nov-2023), then per Paw.162 you can bring it into Thailand and it will not be taxable and possibly < unsure > not assessable.  Again - others can correct me if wrong. 

 

If it is not assessable then it need not be declared.

Thanks for your reply, absolutely that's money was saving before in my belgium bank account. What should i do to prove it ? Is it enough to provide a statement from my bank ? In that case, should i declare the 250.000 THB on march 2025. Cheers.

 

[chiang mai]

56 minutes ago, steph83 said:

Thanks for your reply, absolutely that's money was saving before in my belgium bank account. What should i do to prove it ? Is it enough to provide a statement from my bank ? In that case, should i declare the 250.000 THB on march 2025. Cheers.

 

If the money was from savings and you can prove that via bank statement, you do not have to declare it on a tax return because it is non-assessable to tax.

[oldcpu]

1 hour ago, steph83 said:

Thanks for your reply, absolutely that's money was saving before in my belgium bank account. What should i do to prove it ? Is it enough to provide a statement from my bank ? In that case, should i declare the 250.000 THB on march 2025. Cheers.

 

 

What I have done is kept a financial record of what was in my foreign accounts at the close of business on Friday 29-Dec-2023.   I have also kept a record of any withdrawals from that account in year 2024, such that if ever audited, I can prove that I had sufficient funds in that account to prove it credible that all subsequent withdrawals was money saved from  before 1-Jan-2024. 

 

My speculation is one will only need to prove such to Thailand RD  if audited - and hence it will be good to keep organized records on this.

[steph83]

A big thanks to chiang mai and oldcpu

 

Cheers !