Thai tax tangle: Expats warned of new rules on overseas income

[seajae]

15 hours ago, Jingthing said:

I get why people are flocking to this space.

To "help" expats with their Thai taxes.

They have a lot of pricing power!

Dealing with tax implications for two or more countries they can justify charging a lot. 

I do my U.S. taxes online for either free or 40 dollars max.

But these Thai tax "expert" "specialists" here are really taking people to the cleaners or at least trying to. 

I'm not saying there aren't some credible and qualified people in the space who apparently legally need to be Thai nationals.

But buyer beware big time on this one!

Spot on mate, they all see the dollar/baht signs they can make from ripping off farangs with the new tax BS, it is all just a money grab, something thais seem to be pretty good at. 

[Surasak]

1 hour ago, nickmondo said:

absolute rubbish.

take no notice of foreigners advising on tax issues in Thailand.

it is illegal, and they know nothing.

go to your tax office and ask them to assign you a reference............they will look at you as if you are insane and tell you to go away.

 

Unfortunately mine didn't. I came away with an assurance, no tax was payable on my UK incomes. However, I was given a form with a T.I.N. I will entrust the filling of said form, to my son to complete the necessary details, to ensure he receives his usual monthly allowance. More than one way of skinning a cat.  

[jojothai]

17 minutes ago, darrenrrrr said:

I am an Australia we have a double tax treaty with Thailand , clause 19 says pensions won’t be subject to tax, does this include government pension but also private pensions (that the retiree funded themselves during their working life , we call it superannuation ). Also our private pensions are tax free from 60 years old if you are fully retired which means we pay not tax on earnings such as interest and capital gains tax (CGT). As such clause 19 read also with clause 20 is a bit confusing.

 

So I am assuming if I have a regular pension payment to my Australian bank and then send over my monthly pension amount to a Thai bank is this income taxable by Thailand or it’s not considered income ?

it is necessary to read and understand clause 19 fully.  i have seen posts where people misinterpret the wording , not just for oz.

It is clear. Pension is only taxable in the contracting state of residence. if you are resident here, it is only taxable here -  if remitted.

but you could offset any tax paid in oz.

Clause 20 is specifically excluding income / pensions from government service.

Please note that in Thailand pension is classed as income. Capital gains is also classed as income here.

at present only if remitted to thailand.

[thpitsch]

 

This is my actaual tax return as an example. Accepted by the Revenue Office in Pattaya on Jan. 07. 

 

	Date	EUR	Rate	THB	THB	INCOME
Remittances 2024	14.03.2024		39,0009		348.866,01 THB
	23.07.2024		39,5222		334.112,20 THB	682.978,21 THB
Carried over from 2023 No income from 2024	29.12.2023	7.032,00 €	37,9404		-266.796,89 THB	416.181,32 THB
Deductions		Standard		60.000,00 THB
		Pension		100.000,00 THB
		65+		190.000,00 THB
		Health Insurance		25.000,00 THB	-375.000,00 THB	41.181,32 THB

 

The income after deductions is below the free 150,000 so I had tot to pay tax.

Why to make it more complicated?

 

[jojothai]

13 minutes ago, darrenrrrr said:

So if I have a tax free pension in Australia but live in Thailand you are saying I will be taxed , that’s not how I read clause 19 of the Australian DTA it states in the contracting state where is is earnt 

the oz DTA does not state "where it was earnt".

I have seen some DTAs that specifically state that, but unfortunately the oz DTA does not state it.

[anchadian]

News team please don’t post further articles from so called tax advisers who are only trying to drum up business. There is nothing new that we don’t already know.

 

Until we receive an official report from either the RD or government, then maybe many expats will act accordingly.

The confusion remains.

[jojothai]

5 minutes ago, thpitsch said:

 

This is my actaual tax return as an example. Accepted by the Revenue Office in Pattaya on Jan. 07. 

 

	Date	EUR	Rate	THB	THB	INCOME
Remittances 2024	14.03.2024		39,0009		348.866,01 THB
	23.07.2024		39,5222		334.112,20 THB	682.978,21 THB
Carried over from 2023 No income from 2024	29.12.2023	7.032,00 €	37,9404		-266.796,89 THB	416.181,32 THB
Deductions		Standard		60.000,00 THB
		Pension		100.000,00 THB
		65+		190.000,00 THB
		Health Insurance		25.000,00 THB	-375.000,00 THB	41.181,32 THB

 

The income after deductions is below the free 150,000 so I had tot to pay tax.

Why to make it more complicated?

 

i note that health insurance cost was an allowance. that sounds appropriate. thanks. i need to check any limits.

[cjinchiangrai]

14 hours ago, Briggsy said:

What would be the incentive to file?

 

Let me give you some completely hypothetical examples.

 

1. They refuse to extend your permission to stay unless you provide proof you have filed a tax return.

2. They issue an estimated assessment for a year you did not file.

3. They issue a fine for a year you did not file.

4. The Thai bank freezes your bank account unless you provide proof you have filed a tax return.

 

Currently these all seem very unlikely.

 

So I am back to my original question, what would be the incentive to file a Thai tax return.

They all seem pretty likely to me. What would they do at home?

[Guderian]

I already have a house in South Pattaya worth around 8 million Baht. My plan, developed during the pandemic, was to sell it, bring in another 6 million Baht or so from my offshore savings, and buy a bigger house, still in Pattaya but away from the mass tourism which has got out of control now. In theory, as the savings were in my account prior to 1/1/24, that would be tax-free, but even this snake oil salesman, Carden, admits that its still a grey area where nobody knows how it will be treated. So now, if the TRD gets aggressive with its tax plans, I'll just go the non-resident route, stay in Thailand for 170 or so days a year in future, and use the 6 million Baht to buy another house, probably in the Philippines, and stay there for around 130 days a year, so also not tax resident. The remaining 60 or so days a year I already spend in my property back in the UK, so buying one more in the PI isn't a hardship.

 

Governments need to get realistic about this, the idiots in the OECD may rant on about tax justice but to be fair it needs to be a double-edged sword. If a country wants someone to pay tax like a local then they should also offer them similar benefits to a local; the right to own land, for example, and a fast-track route to permanent residency, then maybe people like myself would be more willing to pay tax. As things stand, if global income is really to be taxed wherever you are living on the planet, then I might as well become tax resident in the UK again, at least I'd qualify for NHS treatment and prescriptions, and my state pension would be indexed.

[darrenrrrr]

Sorry only new how do I reply to a specific post can’t see a reply button

[KhunHeineken]

24 minutes ago, darrenrrrr said:

So if I have a tax free pension in Australia but live in Thailand you are saying I will be taxed , that’s not how I read clause 19 of the Australian DTA it states in the contracting state where is is earnt 

Article 18 of the Australia / Thailand DTA relies on the provisions of Article 19 in the DTA, and Article 19 states government service pensions are covered by the DTA. 

 

The aged pension is not a government service pension.

[Card]

5 minutes ago, anchadian said:

News team please don’t post further articles from so called tax advisers who are only trying to drum up business. There is nothing new that we don’t already know.

 

Until we receive an official report from either the RD or government, then maybe many expats will act accordingly.

The confusion remains.

If they are drumming up business then why don't they also post their contact details at the sane time. Durggh. They don't coz they ain't. 

[cjinchiangrai]

3 minutes ago, Guderian said:

I already have a house in South Pattaya worth around 8 million Baht. My plan, developed during the pandemic, was to sell it, bring in another 6 million Baht or so from my offshore savings, and buy a bigger house, still in Pattaya but away from the mass tourism which has got out of control now. In theory, as the savings were in my account prior to 1/1/24, that would be tax-free, but even this snake oil salesman, Carden, admits that its still a grey area where nobody knows how it will be treated. So now, if the TRD gets aggressive with its tax plans, I'll just go the non-resident route, stay in Thailand for 170 or so days a year in future, and use the 6 million Baht to buy another house, probably in the Philippines, and stay there for around 130 days a year, so also not tax resident. The remaining 60 or so days a year I already spend in my property back in the UK, so buying one more in the PI isn't a hardship.

 

Governments need to get realistic about this, the idiots in the OECD may rant on about tax justice but to be fair it needs to be a double-edged sword. If a country wants someone to pay tax like a local then they should also offer them similar benefits to a local; the right to own land, for example, and a fast-track route to permanent residency, then maybe people like myself would be more willing to pay tax. As things stand, if global income is really to be taxed wherever you are living on the planet, then I might as well become tax resident in the UK again, at least I'd qualify for NHS treatment and prescriptions, and my state pension would be indexed.

Except you agreed to their terms when you signed the visa application.

[darrenrrrr]

Article 18

Pensions and annuities

 

1. Subject to the provisions of Article 19, pensions and annuities paid to a resident of one of the Contracting States shall be taxable only in that State.

 

2. The term "annuity" means a stated sum payable periodically at stated times during life or during a specified or ascertainable period of time under an obligation to make the payments in return for adequate and full consideration in money or money's worth.
 

so if I am a resident of both Australian and Thailand because it’s not taxable in Australia because it’s tax free from 60 yo ( I paid 15% tax during the life of the superannuation then converted to a private allocated pension which is tax free with earnings ), then if I send say 100,000 baht per month from my Australian pension to a Thai bank the are you saying I pay tax on that 100,000 baht per month Or just the pension fund earnings ? As seems u fair if I have already paid tax on it when it was in the superannuation phase 

[Kenneth White]

I want to add to my first reply. If the Thai Revenue Department wants more money to spend, it should investigate the thousands of unregulated food stalls, roadside vendors, etc. These vendors are paid cash, and I would almost bet they don't pay any tax. If they do, they don't claim all of it; they skim off some and report only a tiny amount. 

[nglodnig]

3 hours ago, Card said:

Through Thai financial institutions that you use to transfer cash to or from or exchange it in thailand

I don't think you know how financial transactions work - how are "they"  going to identify ME (or actually my [Thai] wife who is the main user of the credit card) as a resident of Thailand? Dosing rods?

[Card]

2 minutes ago, Guderian said:

I already have a house in South Pattaya worth around 8 million Baht. My plan, developed during the pandemic, was to sell it, bring in another 6 million Baht or so from my offshore savings, and buy a bigger house, still in Pattaya but away from the mass tourism which has got out of control now. In theory, as the savings were in my account prior to 1/1/24, that would be tax-free, but even this snake oil salesman, Carden, admits that its still a grey area where nobody knows how it will be treated. So now, if the TRD gets aggressive with its tax plans, I'll just go the non-resident route, stay in Thailand for 170 or so days a year in future, and use the 6 million Baht to buy another house, probably in the Philippines, and stay there for around 130 days a year, so also not tax resident. The remaining 60 or so days a year I already spend in my property back in the UK, so buying one more in the PI isn't a hardship.

 

Governments need to get realistic about this, the idiots in the OECD may rant on about tax justice but to be fair it needs to be a double-edged sword. If a country wants someone to pay tax like a local then they should also offer them similar benefits to a local; the right to own land, for example, and a fast-track route to permanent residency, then maybe people like myself would be more willing to pay tax. As things stand, if global income is really to be taxed wherever you are living on the planet, then I might as well become tax resident in the UK again, at least I'd qualify for NHS treatment and prescriptions, and my state pension would be indexed.

1. I don't think you can avoid tax just by flitting around the workd staying less than 180 days in 1 place. Tax authorities are aware of that ruse. I think if u do that then your income will just be taxed fully in your home country as if u are a tax resudent there.

2. Yes I agree that if u pay tax like a citizen resident then u should receive the same benefits but life is a beach in thailabd sometimes. Global assets tax is imminent in thailand just like in other oecd countries. The shift in demographics to an elderly population is part of the reason why it's happening everywhere now.

[Card]

8 minutes ago, KhunHeineken said:

Article 18 of the Australia / Thailand DTA relies on the provisions of Article 19 in the DTA, and Article 19 states government service pensions are covered by the DTA. 

 

The aged pension is not a government service pension.

Correct. A 'government pension' is one resulting from employment by the govt. Different from a state pension.

[kingstonkid]

15 hours ago, Upnotover said:

 

Clearly answered in the OP.....

 

 

I think in all fairness the challenge that advisors have is tht the governemtn really is not letting people know.  This was set up as stated for the rich to have to pay.  I firmly believe that a lot of us were not even thought of.

 

I talked to an advisor a couple of days ago, and he explained that it is only money I bring into the country. However, he advised that my Canadian Penson from the government is exempt, but he was not sure about military pensions or medical benefits. He outlined what I would have to pay and left it at that.

 

I will file only because it is cheap for me, but I think a lot more needs to be outlined.  Do Thqais get a break on their mortgage if so that should apply to us.

[Card]

4 minutes ago, Kenneth White said:

I want to add to my first reply. If the Thai Revenue Department wants more money to spend, it should investigate the thousands of unregulated food stalls, roadside vendors, etc. These vendors are paid cash, and I would almost bet they don't pay any tax. If they do, they don't claim all of it; they skim off some and report only a tiny amount. 

Except that is not adding to the discussion in any way 

[Presnock]

14 hours ago, BritManToo said:

Do either of these guys work for the Thai tax authorities?

If not, their advice is not relevant IMHO.

well, if the TRD can't ome up with forms in some readable languages for expats, then I really fail to understand why the govt is so insistent about expats filing.  Here we have been informed over a year ago, so why have forms in relevent languages not available for the expats?  There is no excuse in my opinion anyway unless, they plan to do as the pI, not require retirees to file tax forms nor taxes at all on their retirement.  Good luck on filing as I am not planning to do any filing this year for sure.

[Expat68]

I do not understand why everyone is getting so worked up, the vast majority will not pay tax anyway and the rest will  only be minimal but of course there maybe some people who have got something to hide

[kingstonkid]

Were any AN members present, and if so, can they chime in, please?

 

[Briggsy]

7 minutes ago, cjinchiangrai said:

They all seem pretty likely to me. What would they do at home?

In the UK, there is no necessity to complete a tax return unless you yourself have registered for self-assessment. Examples of those who register for self-assessment are the self-employed with a turnover of at least £1000 per year or high earners with a total income in excess of £100,000.

 

Once you have registered for self-assessment, the penalties just pile up if you do not submit a tax return.

 

If you have not registered for self-assessment, nothing happens and you are left alone unless HMRC gain some information that you should have registered for self-assessment or have some untaxed income.

 

Actually more often in the UK, HMRC actively de-register from self-assessment when there is no tax owing and no need for a tax return to reduce administration.

[BritManToo]

10 minutes ago, Presnock said:

then I really fail to understand why the govt is so insistent about expats filing. 

I don't believe the Thai government has ever requested retired expats to file Thai tax returns. The wording of any official statements seems to be looking for Thai citizens to file on their overseas incomes.

 

All the claims that retired expats need to file seem to be from white crooks looking to make money from elderly and gullible foreign retirees.

[Card]

5 minutes ago, nglodnig said:

I don't think you know how financial transactions work - how are "they"  going to identify ME (or actually my [Thai] wife who is the main user of the credit card) as a resident of Thailand? Dosing rods?

ALL your financial records anywhere where thailand has a dta are sent ti the Thai is. They just need to key in your details. If your bank is in a state with a Thai dta then your credit card details abd transactions are available under common reporting standards. They know if u have used it in thailabd or your home country abd they know if u transfer funds to your wife adter using it abd they know if u are a resudent in thailabd 

[thaipo7]

16 hours ago, MikeandDow said:

They will have to be knocking on my door before i fill out any of there BS

“All foreign income must be declared but this doesn’t always mean a tax liability.”  If there may be no tax, why must they know about your income.

[cjinchiangrai]

2 minutes ago, Briggsy said:

In the UK, there is no necessity to complete a tax return unless you yourself have registered for self-assessment. Examples of those who register for self-assessment are the self-employed with a turnover of at least £1000 per year or high earners with a total income in excess of £100,000.

 

Once you have registered for self-assessment, the penalties just pile up if you do not submit a tax return.

 

If you have not registered for self-assessment, nothing happens and you are left alone unless HMRC gain some information that you should have registered for self-assessment or have some untaxed income.

 

Actually more often in the UK, HMRC actively de-register from self-assessment when there is no tax owing and no need for a tax return to reduce administration.

We are not in the UK. Those are not the Thai rules. Follow them or go home.

[Presnock]

2 hours ago, Card said:

Haha. Phillipines is worse. They tax globally not just remitted funds!

well, I thought it iwas different so googled the PI and retirement funds - they do exempt basic retirement funds - look it up.  I note on their forum that for the most part retirees don't pay taxes there.

[Card]

4 minutes ago, Briggsy said:

In the UK, there is no necessity to complete a tax return unless you yourself have registered for self-assessment. Examples of those who register for self-assessment are the self-employed with a turnover of at least £1000 per year or high earners with a total income in excess of £100,000.

 

Once you have registered for self-assessment, the penalties just pile up if you do not submit a tax return.

 

If you have not registered for self-assessment, nothing happens and you are left alone unless HMRC gain some information that you should have registered for self-assessment or have some untaxed income.

 

Actually more often in the UK, HMRC actively de-register from self-assessment when there is no tax owing and no need for a tax return to reduce administration.

You can go via the tax evasion path if u like but then u could be looking over your shoulder fir the rest if your life esp when u pass through immigration.