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

[Presnock]

2 hours ago, EVENKEEL said:

If it was a story, I'd imagine the Thai news on TV would have been running with the story. The only places we see any coverage is foreigner based articles.

 I totally agree.  The problem from what I notice is the failure of the Thai government through the Finance Ministry and TRD who are looking to garner additional funds through the expansion of the tax base here and have failed to keep the expats informed of any other changes to the taxe other than the 31 December 2023 change date on remittances.  Even this they have failed to advise officially by easily interviewing with news media if all foreigners MUST obtain a Thai Tax ID and file 2024 tax forms for exempted foreign income i.e. protected by DTA's, LTR exemptions, or pensions taxed already in one's home country because it is my understanding from what we have seen on this forum of members going to a local RD office and being advised that they don't qualify for a tax number because they have "exempted" income so not necessary to file tax forms so do not need a tax id.  Then we hear webinars  that give us some advice that we do need to get that tax id and file whether or not we have assessable income here even though not taxed.  I feel I will ot have to pay any Thai income tax on the funds I remit but would appreciate an official TRD interview to the press that ALL expats with ANY remitted funds needs to get a tax id and file or not.  my feelings anyway, as I like to follow any of the local rules and regulations and not just speculation.  I notice on every one of these different tax stories, one of the big problems is lac of credible information instead of GUESSES on what is expected of us.

[The Cyclist]

7 minutes ago, Presnock said:

but would appreciate an official TRD interview to the press that ALL expats with ANY remitted funds needs to get a tax id and file or not.

 

Just a guess on my part.

 

The Revenue Code in Thai Language is the " Master Copy and bible " English translations are for information only and in any dispute resolution, the Thai language copy will be the final arbiter.

 

Just like Thai Courts, only Thai language is used.

 

So, I doubt very much that we will ever get a Revenue Official making statements in the English Language.

 

Play safe, tax resident and remit income from 01 Jan 2024, try to file and be guided by your local tax office.

 

Whats the worst that can happen ? You might have to pay a few baht in tax, if you are unlucky.

 

Better than getting dragged over the coals at a later date.

 

 

[Neeranam]

Do any of the posters here have a link to any law stating that retired pensioners need to get a TIN and file tax returns?

[The Cyclist]

4 minutes ago, Neeranam said:

Do any of the 'experts' here have a link to any law stating that retired pensioners need to get a TIN and file tax returns?

 

Not a law that states " Pensioners "

 

I think the Law states something like " Aquire a TIN within 30 days of having assessable income "

 

Section 41 of the Revenue code applies. Which then directs you to Section 40 for the 8 Categories of " Assessable income.

 

As this leaflet explains

 

https://www.rd.go.th/fileadmin/user_upload/lorkhor/newspr/2024/FOREIGNERS_PAY_TAX2024.pdf

[NoDisplayName]

5 hours ago, Presnock said:

Did they provide the address of the "THAI" Embassy in Thailand?

 

Shirley, it must have been provided.........just below the paragraph where they stated that all non-assessable remittances must be declared on a Thai tax return because of CRS rules followed by Kenya, and making US social security assessable income in Thailand.

 

Didn't you see the big, bold notice where the Thai embassy provided detailed instructions on how to deduct exempt income on the tax form with the specific procedure to take a foreign tax credit?

 

Oh, wait............maybe they meant to consult Youtube videos posted by any random tax agency that clickbaits potential clients by using a web address disguised as the Thai Embassy!

[oldcpu]

1 hour ago, CallumWK said:

 

Interests are not accessible income in my opinion.

 

further to this, I tried reading parts of the Thai tax code.

 

I see section-40 of the Thai tax code in 40(4a) includes "interest on a bond, deposit ... " as assessable income.

 

However as happens from time to time with the tax code, other aspects than a single paragraph are also relevant. One must continue reading

 

I then noted section-42 of the tax code:

 

Quote

 

Section 42

The assessable income of the following categories shall be excluded for the purpose of income tax calculation:

 

8.  The following interest:
(a) Interest from Government savings lotteries, or interest on demand deposit with the Government Savings Bank;
(b) Interest on savings deposit with a cooperative;
(c) Interest on savings deposit with a bank in Thailand which is repayable on demand; only in the case where the total amount of interest received by any taxpayer does not exceed 10,000 Baht throughout tax year, in accordance with the rules, procedures and conditions as prescribed by the Director- General.

 

 

10,000 THB is a pretty low threshold and easy to exceed.

 

That suggests our hypothetical billionaire needs to include their $3-million USD interest as assessable income, file a tax return, but not pay any more than their 15% withholding tax. 

 

EDIT: I am still looking for more relevant sections on 'withholding tax' in regards to not being included (or being included) in 'assessable income"

 

On a different (but related aspect) I looked at what it states about mutual fund income and assessable income:

 

i recall Krungsri bank personal, in trying to sell me a mutual fund, claimed mutual fund income need not be put in a Thailand tax form (ie saying such is not  assessable income) so in the Thai tax code I noticed with interest section 42(c)

 

Quote

 

Section 42(c)

42(c)The assessable income of the following categories shall be excluded for the purpose of income tax calculation:
(22)  Income from sale of investment units in a mutual fnd
(23) income of a mutual fund

 

That seems to support what Krungri bank stated. i.e. mutual fund income is not included in the tax calculation and it is not assessable income.

 

However , I still have not looked to see if there are any relevant Royal Decrees nor Ministerial instructions on interest in Thailand in regards to tax calculation.

 

Further - I could have missed points or other relevant tax code clauses, so one really needs to triple check everything I noted - as I too am unsure.

[The Cyclist]

5 minutes ago, oldcpu said:

That suggests our hypothetical billionaire needs to include their $3-million USD interest as assessable income, file a tax return, but not pay any more than their 15% withholding tax.

 

That hypothetical billionaire could have old bank accounts like me, that do not pay any interest.

[NoDisplayName]

9 hours ago, ukrules said:

Which is where the trap is set - someone sells their house next month (Feb 2025), moves to Thailand  in March 2025 and remits say 10 million Baht and remains for the rest of the year looking for a house or condo to purchase will be hit with a large and likely unexpected bill.

 

The person that moved USD$300,000 into Thailand, without a plan? and stuck it in a Thai bank for nearly a year? with only one million baht protection? earning 0.5% interest? with 15% tax withheld on that?  and doesn't utilize one of the useful visa options?

 

That fellow deserves to pay a 25% stupid tax.

[Neeranam]

10 minutes ago, The Cyclist said:

 

Not a law that states " Pensioners "

 

I think the Law states something like " Aquire a TIN within 30 days of having assessable income "

 

Section 41 of the Revenue code applies. Which then directs you to Section 40 for the 8 Categories of " Assessable income.

 

As this leaflet explains

 

https://www.rd.go.th/fileadmin/user_upload/lorkhor/newspr/2024/FOREIGNERS_PAY_TAX2024.pdf

So Order Di. Por. No. 161/2023 is an Administrative order and not a law. 

 

I'm confused. I'm Thai and this new order certainly affects me, but why are foreigners so worried about it?

If they were't filing taxes before, why do it now because of this order?

 

Seems that the RD haven't got a clue what they are doing but in order not to lose face are having meetings with foreigners and putting English stuff on their info sites, purely because of all the fools going to the tax office, freaking about they might be deported and asking if they can pay tax.  I think it is paranoia about being refused a visa or maybe it is similar to the ones who jump hoops to get a useless pink non-Thai ID card that migrant workers have. Why do foreigners want to be part of the system if not required by law???

 

https://mahanakornpartners.com/the-revenue-department-closes-loopholes-tightening-tax-collection-on-foreign-income/?utm_source=chatgpt.com

 

[oldcpu]

Just now, The Cyclist said:

 

That hypothetical billionaire could have old bank accounts like me, that do not pay any interest.

 

Sadly I am not such a hypothetical billionaire ... very very far from such ...  but perhaps similar to you, I also went for bank accounts with low interest for my funds in Thailand.  For funds outside of Thailand (such as Canada) where I already file an income tax return every year to Canada, I do try to optimize my investment and obtain much higher returns.

[oldcpu]

1 minute ago, NoDisplayName said:

 

The person that moved USD$300,000 into Thailand, without a plan? and stuck it in a Thai bank for nearly a year? with only one million baht protection? earning 0.5% interest? with 15% tax withheld on that?  and doesn't utilize one of the useful visa options?

 

That fellow deserves to pay a 25% stupid tax.

 

 Thats why its a hypothetical example.  lol.

 

[NoDisplayName]

4 hours ago, The Cyclist said:

 

Yes, it seems pretty clear to me. If you are going to remit a large amount of money, remit it in a year you deliberately make yourself a non Resident for tax purposes of Thailand.

 

Or.........remit only NON-assessable funds.

 

Then you don't need to file a return, and you don't even need a TIN.  You don't gotta do nuttin'!

[oldcpu]

8 minutes ago, Neeranam said:

So Order Di. Por. No. 161/2023 is an Administrative order and not a law. 

 

I'm confused. I'm Thai and this new order certainly affects me, but why are foreigners so worried about it?

If they were't filing taxes bef

 

 

 

Yes.  por.161 is not law. Its a ministerial instruction, but if one wishes to go against it then one is into legal action with the Thai Revenue department.  That is something I would prefer not to do.

 

Why is 161 of interest? 

 

Because before, both Thai and foreigner would have income outside of Thailand, but they would not remtit such in the year of earning. They would wait a year.  Then they call it savings.  Because prior to por.161, the tax interpretation was only money remitted in the year of earning was taxable. 

 

Por.161 closed that loophole. 

 

With por.161, no matter when one remits foreign income, it is considered assessable and taxable (subject of course to tax exemptions such as Royal Decrees, DTAs ... and other aspects of the tax code).

 

Also note por.162 specifies that por.161 is only from 1-Jan-2024 onward.

[NoDisplayName]

3 hours ago, The Cyclist said:

It is not a major story in Thai news circles, because it does not affect the vast majority of Thai's.

 

It only affects Thai's that remit income into Thailand from overseas.

 

Given that the vast majority of Thais affected are rich, super rich and Politicians, it makes you wonder why Thailand enacted it, in the 1st place.

 

* There will be some Thais outside those 3 that are contracting elsewhere in the World.

 

It should not be a major story in Expat news circles, because it does not affect the vast majority of Expats.

 

It only affects Expats that remit ASSESSABLE income into Thailand from overseas.

 

Given that the vast majority of online Expats affected are living day-to-day on a meager non-exempt assessable pension, subsisting mainly on mama noodles, it makes you wonder why Thailand enacted it, in the 1st place.

 

* There will be some Expats outside those that have gotten their finances in order.

[The Cyclist]

11 minutes ago, Neeranam said:

So Order Di. Por. No. 161/2023 is an Administrative order and not a law. 

 

Getting a TIN is nothing  to do with POR 161.

[oldcpu]

9 minutes ago, NoDisplayName said:

Given that the vast majority of online Expats affected are living day-to-day on a meager non-exempt assessable pension, subsisting mainly on mama noodles, it makes you wonder why Thailand enacted it, in the 1st place.

 

 

Interesting view. ... and i guess my comment off topic, but is this really the case?  I speculate not the case in Phuket where I live but possibly in other provinces.

[The Cyclist]

5 minutes ago, NoDisplayName said:

It only affects Expats that remit ASSESSABLE income into Thailand from overseas.

 

And that is where we disagree.

 

Section 40 ( 1 ) says Pensions are assessable income.

 

Assessable does not mean taxable.

 

You seem to have a severe issue grasping that point.

[NoDisplayName]

2 hours ago, CallumWK said:

 

Nope, that interest will get taxed by withholding taxes. It isn't income

 

Huh?  Bank interest is Thai-sourced income.  Taxed at source.

Absopostively assessable.

 

You can exclude it from your tax return if not claiming the deduction.  It's already been taxed, so does not need to go through the process again.

 

To claim the refund, you simply enter the amount earned and the amount withheld in the appropriate blocks........on the tax form.

 

Hmmmm..........interesting how they put the option to remove the already taxed income from the total prior to the PIT calculations.

 

Fascinating.

[The Cyclist]

2 minutes ago, oldcpu said:

 

Interesting view. ... and i guess my comment off topic, but is this really the case?  I speculate not in Phuket where I live but possibly in other provinces.

 

No its not the case, with the exception of possibly some UK pensioners that are surviving only a State Pension.

 

Which oddly enough, is assessable income, but probably falls below the level where tax becomes payable.

 

The other oddity with the UK State Pension ( In the majority of cases ) is that it not taxable in the UK, so there is no tax credit available.

[oldcpu]

2 minutes ago, NoDisplayName said:

 

Hmmmm..........interesting how they put the option to remove the already taxed income from the total prior to the PIT calculations.

 

Fascinating.

 

it is fascinating - I still can't find that in the tax code - but I assume its there.

 

(I tend to be skeptical sometimes and like to find the most official source).

[NoDisplayName]

Just now, The Cyclist said:

 

And that is where we disagree.

 

Section 40 ( 1 ) says Pensions are assessable income.

 

Assessable does not mean taxable.

 

You seem to have a severe issue grasping that point.

 

I have no issue understanding that not taxable means non assessable.

 

I understanded it good enough to file my taxes.

 

How 'bout you, buddy?

 

Better get crackin'!  Tax season is 1/3 over, and I don't think Santa is going to be bringing you new tax forms this year.

[oldcpu]

Just now, NoDisplayName said:

 

I have no issue understanding that not taxable means non assessable.

 

I understanded it good enough to file my taxes.

 

How 'bout you, buddy?

 

Better get crackin'!  Tax season is 1/3 over, and I don't think Santa is going to be bringing you new tax forms this year.

 

At the risk of my getting my head chopped off ... lets not go there.

 

We know we have disagreements with others (you and I have similar views I suspect). 

 

Still lets wait and see how this plays out.

[The Cyclist]

2 minutes ago, NoDisplayName said:

Better get crackin'!  Tax season is 1/3 over, and I don't think Santa is going to be bringing you new tax forms this year.

 

No worries for me.

 

It will be a PND 91, 2 pages of the UK DTA and copies of my P60's.

 

It will  then be up to the RD Office to do as they please.

 

Something else you have difficulty in grasping, I couldn't care less, whatever route the RD Office wants to go down.

[oldcpu]

5 minutes ago, The Cyclist said:

 

No its not the case, with the exception of possibly some UK pensioners that are surviving only a State Pension.

 

Which oddly enough, is assessable income, but probably falls below the level where tax becomes payable.

 

The other oddity with the UK State Pension ( In the majority of cases ) is that it not taxable in the UK, so there is no tax credit available.

 

i have not researched UK state pensions.  i do recall someone stating to me that they don't get annual inflation adjustments if one is an expatriate.

 

This reads to be somewhat painful - and a good reminder to me that i am very lucky in regards to my pension sources.

[oldcpu]

1 minute ago, The Cyclist said:

 

No worries for me.

 

It will be a PND 91, 2 pages of the UK DTA and copies of my P60's.

 

It will  then be up to the RD Office to do as they please.

 

Something else you have difficulty in grasping, I couldn't care less, whatever route the RD Office wants to go down.

 

I suspect most of use are much more curious than you as to how the tax forms are precisely completed.

 

Best wishes (and I type that with a good heart) in terms of how this turns out.

[The Cyclist]

1 minute ago, oldcpu said:

i have not researched UK state pensions.  i do recall someone stating to me that they don't get annual inflation adjustments if one is an expatriate.

 

Not quite true. Those that move to Thailand do not get an annual uplift, whilst those that move to the Philipines do.

 

Something to do with reciprocal agreements, that I have never looked into.

 

I'm still working on the basis that I will not get a State Pension due to it becoming means tested between now and me reaching claiming age.

[DrPhibes]

2 hours ago, The Cyclist said:

 

Correct,

 

You as an Individual ( Even an American Individual ) remitting money into a CRS Country on the other hand, is a different story.

Does not submit me to CRS reporting, and since the US does not participate in CRS, accomplishes what exactly?

[The Cyclist]

2 minutes ago, DrPhibes said:

Does not submit me to CRS reporting, and since the US does not participate in CRS, accomplishes what exactly?

 

Every foreign account in Thailand is subject to CRS reporting.

 

It is the account, in a CRS Country that matters, not the Nationality of the account holder.

 

Some of you Americans are nowhere near as speshul as you seem to think you are.

[Neeranam]

22 minutes ago, oldcpu said:

 

Yes.  por.161 is not law. Its a ministerial instruction, but if one wishes to go against it then one is into legal action with the Thai Revenue department.  That is something I would prefer not to do.

 

Why is 161 of interest? 

 

Because before, both Thai and foreigner would have income outside of Thailand, but they would not remtit such in the year of earning. They would wait a year.  Then they call it savings.  Because prior to por.161, the tax interpretation was only money remitted in the year of earning was taxable. 

 

Por.161 closed that loophole. 

 

With por.161, no matter when one remits foreign income, it is considered assessable and taxable (subject of course to tax exemptions such as Royal Decrees, DTAs ... and other aspects of the tax code).

 

Also note por.162 specifies that por.161 is only from 1-Jan-2024 onward.

 

Now this is an issue that puzzles me. 

Did you wait a year before remitting your pension in previous years?

 

I've had countless retired foreigners asking me if they should get a tax ID and I ask them if they were only remitting monies earned in the previous year, none of them were.

 

How many people here were waiting a year before remitting their pensions due to the loophole? I suspect few, yet all of a sudden it is the main topic on internet forums! 

 

The ONLY thing that has changed is scrapping that waiting a year before remitting, so if you weren't doing it before, don't start doing it as obviously you don't understand what's the new order is all about. It's going after huge companies that were saving millions of baht in tax by using this loophole. 

 

If you were previously waiting a year before remitting your pension, speak up. 

 

[Neeranam]

5 minutes ago, The Cyclist said:

Every foreign account in Thailand is subject to CRS reporting

I don't think so. 

From my research - 

CRS reporting applies if you:
Hold a bank account in Thailand but are a tax resident in another CRS-participating country (UK, US, EU countries).

Have a foreign tax residency declared on your Thai bank account.
Meet financial thresholds for reporting (varies by bank and account type).

However, if you are a Thai tax resident and your foreign account is in Thailand, it is not automatically reported abroad under CRS—unless Thailand has an exchange agreement with another country regarding your tax status.

 

What Does This Mean for You?

If you earn income from a UK company but are a Thai tax resident, your Thai account may not be automatically reported under CRS.

If you are also a UK tax resident or declare UK tax residency to a Thai bank, your Thai financial accounts may be reported to UK tax authorities.