Will Thai condo sales to foreigners become seasonal because of tax enforcement??

[chiang mai]

3 minutes ago, phetphet said:

I agree with Yumthai, that there will be some form of exemption for property purchase. But, however they do this, it will surely affect both the property market, and the local economies. Just by the fact of taking money spent out of circulation through taxation.

I have definitely tried to reduce what I have transferred into the country this year, in expectation of a tax bill. Paying for GF's daughter's education and extra curricular lessons is now a real worry.

For a foreigner, it will make everything more expensive, not just property. 

We are the low hanging fruit. Easy to  tax, and subjected to double pricing. I wonder if that one will now stop. I doubt it.

 

It's interesting to note that some expats see tax exemptions for buying property whilst Thai's such as the Chair of the Thai Condominium Association are calling for increased purchase taxes and capital gains on the sale of units, both parties seem to be pulling in opposite directions.

 

 

[Scouse123]

2 hours ago, chiang mai said:

Don't forget that the TRD's primary objective is that it wants to tax wealthy Thai nationals who invest offshore and avoid tax. The benefit to them of doing that is almost certainly far greater than the loss of a few foreign expats, if world wide income tax is implemented.

 

I think you are underestimating and understating by saying" a few foreign expats” and what they bring to the table.

 

Regarding wealthy Thais and their vast incomes abroad, when do you honestly think they will be able to catch up with this group. Those guys have the power to bring down governments in Thailand, and let's face it, it doesn't take much doing.

 

They will never nail the likes of these people, who employ large accountancy experts to navigate and ensure tax avoidance.

[ChaiyaTH]

Agent, transfer fees, stamp duty alone are already the same as the rental yield if for a year. You have to be really stupid to buy a condo for the duration of less than the 180 days a year lol. What is this nonsense....

 

What will happen is that the condo market will eventually plunge and then when prices are at actual realistic rates again, which is a long way to go from here, people will be willing to buy again, regardless of tax.

 

That's the normal cycle of things, history repeats itself. It also makes the middle class smaller and smaller.

Edited 16 hours ago by ChaiyaTH

[CallumWK]

On 12/3/2024 at 8:27 AM, chiang mai said:

I expect funds used to buy property will be exempt, subject to a minimum holding period of say 5 years or more.

 

On 12/3/2024 at 9:22 AM, chiang mai said:

On 12/3/2024 at 9:08 AM, Yumthai said:

IMO it's unlikely to happen. Can you imagine what will be the consequences on the property market and foreigner residents community the day such people will be audited, fined and required to pay 35% marginal tax rate on their RE purchase?

Absurd comment.....no country bases it's real estate market on the premise that all sales to resident foreign buyers will not tax funds used to purchase real estate.

 

So what will it be, will foreign buyers be exempt, or will it not be. Can you make up your mind?

BTW, if you google it, as you like to suggest, it is clear that many counties exempt foreigners of property taxes, to promote their real estate.

[chiang mai]

27 minutes ago, Scouse123 said:

 

I think you are underestimating and understating by saying" a few foreign expats” and what they bring to the table.

 

Regarding wealthy Thais and their vast incomes abroad, when do you honestly think they will be able to catch up with this group. Those guys have the power to bring down governments in Thailand, and let's face it, it doesn't take much doing.

 

They will never nail the likes of these people, who employ large accountancy experts to navigate and ensure tax avoidance.

Yes, maybe. But I'm not sure how many truly wealthy people retire to Thailand any longer. In the 1990's and 2000's it was a good place for pensioners on limited incomes, the ever strengthening baht in the two decades that followed slowed down that flow of new arrivees. The older guys are well established here plus many have no other place to go, they will not leave. The offshore oil and gas industry has pretty much dried up so there's another segment that has reduced. The middle income guys who came here to give it a try, they may make different plans but the truly wealthy guys will just not come in the first place because there's no incentive. 

[oldcpu]

7 minutes ago, chiang mai said:

Yes, maybe. But I'm not sure how many truly wealthy people retire to Thailand any longer. In the 1990's and 2000's it was a good place for pensioners on limited incomes, the ever strengthening baht in the two decades that followed slowed down that flow of new arrivees. The older guys are well established here plus many have no other place to go, they will not leave. The offshore oil and gas industry has pretty much dried up so there's another segment that has reduced. The middle income guys who came here to give it a try, they may make different plans but the truly wealthy guys will just not come in the first place because there's no incentive. 

 

The future is hard to predict.

 

While in a Phuket forum area on AseanNow these is a thread about expats leaving Phuket, in truth, more of the opposite is happening. 

 

More and more foreigners are coming to live in Phuket, despite it being one of the most expensive places in Thailand. 

 

Perhaps this is due to the civil war in Myanmar and due to the war in Europe, where we are seeing many from Myanmar (working - not retiring) and many from Russia (retiring at a rather young age - likely from a wealthier class in Russia).  ...  Plus the influx of wealthy people from China retiring in Phuket (or making Phuket a second home as a backup plan place to stay in case of a second pandemic)  continues to see increasing numbers in Phuket, ...  which is, ... by the way ... driving an active real estate market.

 

So we are at present continuing to see increasing numbers of wealthy foreigners show up in Phuket to live, and perhaps those who once lived in Phuket whose finances were borderline, are either leaving Thailand or are heading up north to Chiang Mai & Chiang Rai where it is much less expensive than Phuket.

[chiang mai]

3 minutes ago, oldcpu said:

 

The future is hard to predict.

 

While in a Phuket forum area on AseanNow these is a thread about expats leaving Phuket, in truth, more of the opposite is happening. 

 

More and more foreigners are coming to live in Phuket, despite it being one of the most expensive places in Thailand. 

 

Perhaps this is due to the civil war in Myanmar and due to the war in Europe, where we are seeing many from Myanmar (working - not retiring) and many from Russia (retiring at a rather young age - likely from a wealthier class in Russia).  ...  Plus the influx of wealthy people from China retiring in Phuket (or making Phuket a second home as a backup plan place to stay in case of a second pandemic)  continues to see increasing numbers in Phuket, ...  which is, ... by the way ... driving an active real estate market.

 

So we are at present continuing to see increasing numbers of wealthy foreigners show up in Phuket to live, and perhaps those who once lived in Phuket whose finances were borderline, are either leaving Thailand or are heading up north to Chiang Mai & Chiang Rai where it is much less expensive than Phuket.

I couldn't agree more. The Chinese market has barely been tapped, Thailand is extremely clever at reinventing itself as a desirable destination and presenting that to new countries and new classes of society.Where I live in Chiang Mai I am surrounded by Chinese, almost 70% of the moobahn is from China and they all have money. As long as Thailand remains neutral it will attract those people wishing to escape conflict zones and there's plenty of those right now!

[CallumWK]

9 minutes ago, oldcpu said:

While in a Phuket forum area on AseanNow these is a thread about expats leaving Phuket, in truth, more of the opposite is happening. 

 

We are talking about mainly Chinese and Russians, Europeans and Aussies are leaving in droves

[oldcpu]

4 minutes ago, CallumWK said:

 

We are talking about mainly Chinese and Russians, Europeans and Aussies are leaving in droves

 

Regardless - the numbers of wealthier expats in Phuket are increasing overall in terms of total numbers.

 

This is obvious to anyone who has lived in Phuket for some years .

 

As for Europeans and Aussies leaving "in droves" .   No - some ARE leaving, but definitely NOT in droves, and those who are leaving (Phuket) are leaving because its now too expensive for them, so they are headed to less expensive places in Thailand (or outside Thailand), while those with money are filling the empty spots and even more arriving than those leaving.

.

Edited 15 hours ago by oldcpu

[jerrymahoney]

This may be an option for some to avoid large cash remittances to Thailand:

 

UOB

 

International Property Loans
Overseas property ownership now made easier.

 

https://www.uob.com.sg/personal/borrow/property-loans/international-property-loan.page

[CallumWK]

7 minutes ago, jerrymahoney said:

This may be an option for some to avoid large cash remittances to Thailand:

 

UOB

 

International Property Loans
Overseas property ownership now made easier.

 

https://www.uob.com.sg/personal/borrow/property-loans/international-property-loan.page

I don't think thi s applies to UOB Thailand

[chiang mai]

23 minutes ago, jerrymahoney said:

This may be an option for some to avoid large cash remittances to Thailand:

 

UOB

 

International Property Loans
Overseas property ownership now made easier.

 

https://www.uob.com.sg/personal/borrow/property-loans/international-property-loan.page

That's UOB Singapore, a different entity to UOB Thailand. Perhaps suitable for some but I suspect the bar may be set quite high.

[anrcaccount]

8 hours ago, Jingthing said:

Yes of course.

I have already well covered that you need to be a Thailand tax resident in the year of import for there to be a tax lssue with transfers.

 

Technically,  the year of remittance is not relevant to the 'tax issue'.

 

As discussed in a previous thread, the technical interpretation is only the year of the sale (realisation of the income) matters, not the timing of the remittance to Thailand. As the others state above , if you sell during a year you are non-tax resident, you can remit the sale proceeds any time following that,  exempt of thai tax,  even if you are Thai tax resident in the year you remit.

Ludicrous, creates the following types of scenarios:

 

2025 - non-resident, sell property overseas, buy thai property, remit sale proceeds, not liable for thai tax

 

2025 - non-resident, sell property overseas 
2026 - thai tax resident, buy thai property, remit sale proceeds, not liable for thai tax 

2025 - thai tax resident , sell property overseas  
2026 - non-resident, buy thai property, remit sale proceeds, liable for thai tax**

(**note, technically, you would be liable as a non-resident, even thought non residents aren't required to file a return.........?!?)
 

[chiang mai]

3 minutes ago, anrcaccount said:

 

Technically,  the year of remittance is not relevant to the 'tax issue'.

 

 

How can that be, Thailand operates a remittance based system of income tax. If you sell but don't remit, you are not liable to tax.

[anrcaccount]

2 minutes ago, chiang mai said:

7 minutes ago, anrcaccount said:

 

Technically,  the year of remittance is not relevant to the 'tax issue'.

 

 

How can that be, Thailand operates a remittance based system of income tax. If you sell but don't remit, you are not liable to tax.

 

Yes, understand on the sell and not remit, agree, you're not liable if you don't remit. I'm replying to the poster who says:

 

I have already well covered that you need to be a Thailand tax resident in the year of import for there to be a tax lssue with transfers.

 

And as stated, actually you can still have a "tax issue" ( apparently, technically) , when you remit in a year that you are NOT a tax resident. As to how that could work in practice....... I would say, unworkable. 

 

[Scouse123]

The only thing about all this is that it is being left to all of us to guess and play out scenarios regarding transfer of monies, resident status, tax implications etc.

 

So far, NOTHING from the so-called decision makers.

[scubascuba3]

13 minutes ago, Scouse123 said:

The only thing about all this is that it is being left to all of us to guess and play out scenarios regarding transfer of monies, resident status, tax implications etc.

 

So far, NOTHING from the so-called decision makers.

Yep, I've decided to ignore it, no need to take drastic action for a year or so

[ukrules]

4 hours ago, anrcaccount said:

 

Yes, understand on the sell and not remit, agree, you're not liable if you don't remit. I'm replying to the poster who says:

 

I have already well covered that you need to be a Thailand tax resident in the year of import for there to be a tax lssue with transfers.

 

And as stated, actually you can still have a "tax issue" ( apparently, technically) , when you remit in a year that you are NOT a tax resident. As to how that could work in practice....... I would say, unworkable. 

 

 

One of the big accountancy firms did release some note clarifying that people can be taxed on profit made during resident years even if it's later remitted in a non resident year. Can't remember 100% which one it was but may have been Sherrings.

So if they decide to audit you and suspect you were a resident when the money was made they will want to see a source of funds even if you were a non resident in the year of remittance in an attempt to catch you out. I imagine they are quite thorough when doing an audit.

 

So remitting during a non resident year may make things a little easier to prove should the need arise, especially if it's the same year that the assets were sold for profit but when it comes down to it they can still demand all sorts of proofs with the default being - you owe tax on this plus penalties.

This kind of thing can get messy real quick as the years go on as people sell things and reinvest in other things, etc over the years.

 

It's a definite minefield.

[Scouse123]

I have come to the conclusion that we don't see Thais getting worked up about taxes owed, so why should I.