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

[ukrules]

6 hours ago, Sophon said:

 

Perhaps.

 

However, they want to tax foreign income, but they also don't want to limit capital inflows to Thailand. The logical solution is to no longer link taxation to transfers and just tax worldwide income for all tax residents, irrespective of whether the income is transferred to Thailand or not. That's what most countries in the world do.

 

That would not work, I don't think you realise the number of people who would leave the country in the year worldwide taxation is enacted.

Many Thai people as well as foreigners would simply limit their stays to less than 180 days - it's easy to do, many have homes in various places throughout the world, taking two or even three trips a year is a simple thing to do when avoiding huge amounts of tax.

 

Then there's the corporate route.

Thailand does not have 'Controlled Foreign Corporations' rules which means they can transfer all their offshore wealth into some corporation which controls / owns any holdings and it then becomes untouchable, they can pay themselves dividends, etc from their own foreign business entity whenever they choose.

This  would likely be in a year when they're non resident in order to avoid any and all tax. This is how the 'more wealthy' individuals and families will do it if they can be bothered / motivated.

The thing is - nothing like the threat of increased taxes motivates someone to get up and go speak to an accountant - and accountants despite the incredibly boring nature of their job at first glance are very creative people!

 

[K2938]

20 minutes ago, ukrules said:

Many Thai people as well as foreigners would simply limit their stays to less than 180 days - it's easy to do, many have homes in various places throughout the world, taking two or even three trips a year is a simple thing to do when avoiding huge amounts of tax.

Agree with most of what you say.  However, foreigners are not really the greatest concern of the Thai government anyway and for the Thais the number of those who are actually willing and able to stay out of the country for half a year is minimal.  Most people just do not have a nomadic life.

[ukrules]

16 minutes ago, K2938 said:

the number of those who are actually willing and able to stay out of the country for half a year is minimal

 

Yes, we're talking about the top 1% here - those with hundreds of millions of Baht, the people being targeted.

 

 

[ukrules]

I can't wait for the onslaught of youtube videos which will surely be heading our way about this new announcement.

I know the article mentions Thais but there is a law that says every 'tax resident' must be treated equally so in that context I believe it's referring to Thai tax residents - not Thai citizens or PRs, etc.

[K2938]

3 minutes ago, ukrules said:

Yes, we're talking about the top 1% here - those with hundreds of millions of Baht, the people being targeted.

Even for the majority of those it will be difficult because they love Thailand too much.  How many Thai billionaires do you know who live in Monaco or the UAE?

[tomkenet]

1 hour ago, ukrules said:

I can't wait for the onslaught of youtube videos which will surely be heading our way about this new announcement.

I know the article mentions Thais but there is a law that says every 'tax resident' must be treated equally so in that context I believe it's referring to Thai tax residents - not Thai citizens or PRs, etc.

Yes, It would be strange to treat tax residents differently from their nationality. 

I guess many of the new "tax consultants" that has emerged the last year are not so happy about this news.

[The Cyclist]

1 hour ago, ukrules said:

 

Yes, we're talking about the top 1% here - those with hundreds of millions of Baht, the people being targeted.

 

 

 

Read the article again

 

This looks like a tax free ( 18 month window ) for rich Thais to repatriate their money into Thailand before global taxation kicks in, in 2027.

[anrcaccount]

4 minutes ago, The Cyclist said:

1 hour ago, ukrules said:

 

Yes, we're talking about the top 1% here - those with hundreds of millions of Baht, the people being targeted.

 

 

 

Read the article again

 

This looks like a tax free ( 18 month window ) for rich Thais to repatriate their money into Thailand before global taxation kicks in, in 2027.

 

I think it is you, that should read the article again. 

 

Firstly, there is no mention at all of global taxation.

 

Secondly, there is no distinction between Thai citizens and foreigners who reside in Thailand, as it relates to taxation. There is nothing in this article that suggest that is changing. 

 

Thirdly, there's nothing to suggest this is just an 18 month window. The principle refereed to is- foreign income remitted same year earned and year following is exempt. Quote below: 

 

"Under the new guidelines, Thais with foreign income will not be taxed if they remit that income in the year it was earned or the following year. For example, if income is earned in 2025 and brought into Thailand in 2025 or 2026, it is not subject to tax."

[The Cyclist]

14 minutes ago, anrcaccount said:

Secondly, there is no distinction between Thai citizens and foreigners who reside in Thailand, as it relates to taxation

 

Is that right - You, and others,  done an awful lot of  pontificating to the contrary previously.

 

 

[beammeup]

So I wonder what this will mean for people cashing out investments? No capital gains if remitted in the same or next year?

[anrcaccount]

4 minutes ago, beammeup said:

So I wonder what this will mean for people cashing out investments? No capital gains if remitted in the same or next year?

 

As written, yes, that's exactly what it will mean.

 

But really, has anyone really ever paid any significant thai tax on foreign remitted capital gains income?  Doubt it. 

[beammeup]

2 minutes ago, anrcaccount said:

 

As written, yes, that's exactly what it will mean.

 

But really, has anyone really ever paid any significant thai tax on foreign remitted capital gains income?  Doubt it. 

Well I was planning on it in 2026 and I was only planning on remitting the minimum amount to live on. This opens the door to spending  a lot more.

[K2938]

12 minutes ago, beammeup said:

Well I was planning on it in 2026 and I was only planning on remitting the minimum amount to live on. This opens the door to spending  a lot more.

Remit as much as you reasonably can based on your monetary situation and your trust in the safety of your Thai bank as the recent flip flops seem to indicate that it is highly likely that in the not too distant future there will be the next change...

 

 

[Yumthai]

1 hour ago, The Cyclist said:

This looks like a tax free ( 18 month window ) for rich Thais to repatriate their money into Thailand before global taxation kicks in, in 2027.

Do you seriously believe wealthy Thais will pay their fair tax share (meaning at 35% marginal rate) at some point in Thailand?

 

With the current PIT rates, worldwide taxation will never happen in Thailand or, if it does, it will come along tax exemptions and other creative workarounds for the big cats.

[anrcaccount]

1 hour ago, beammeup said:

1 hour ago, anrcaccount said:

 

As written, yes, that's exactly what it will mean.

 

But really, has anyone really ever paid any significant thai tax on foreign remitted capital gains income?  Doubt it. 

Well I was planning on it in 2026 and I was only planning on remitting the minimum amount to live on. This opens the door to spending  a lot more.

 

And that is exactly the intent of them changing the guidelines, maybe, just maybe, they are actually on to something sensible this time! 

[NoDisplayName]

On 5/18/2025 at 12:04 PM, JackGats said:

I filed PND 91 for dividends. When I visited TRD in order to get the excess dividend tax refunded, I was asked about my remittances.

 

23 hours ago, JackGats said:

. In my eFiling I had uploaded the Royal Decree in Thai, the TRD-instruction in Thai regarding said Royal Decree, and a screenshot of "no tax on foreign assets" from the LTR website.

 

This is confusing.

 

If you e-filed, why did you visit TRD for a refund?  You would receive the refund letter in the mail.

[NoDisplayName]

2 hours ago, The Cyclist said:

This looks like a tax free ( 18 month window ) for rich Thais to repatriate their money into Thailand before global taxation kicks in, in 2027.

 

This is my understanding of the PROPOSED rule change:

 

Old rule:  Foreign income (not exempt by DTA) earned in prior years is not assessable.  Foreign income (not exempt by DTA) remitted in same year is assessable.

 

New rule:  Foreign income (not exempt by DTA) earned prior to 2024 is not assessable.  Foreign income (not exempt by DTA) earned after 2023 remitted in any year is assessable.

 

Proposed rule:  Foreign income (not exempt by DTA) earned prior to 2024 remains not assessable.  Foreign income (not exempt by DTA) earned after 2024 remitted in the same or following year is not assessable.  Foreign income (not exempt by DTA) earned after 2024 remitted in subsequent years is assessable.

 

For Thailand tax residents:

 

A source from the Finance Ministry who requested anonymity said the taxation of foreign income follows the residency-based principle, whereby Thailand taxes the income of individuals who reside in the country.

 

This rule applies to persons who stay in Thailand for 180 days or more and have foreign income.

 

Doesn't appear to be a one-off approach.  The "for example" was added by the writer of the article.

 

Under the new guidelines, Thais with foreign income will not be taxed if they remit that income in the year it was earned or the following year. For example, if income is earned in 2025 and brought into Thailand in 2025 or 2026, it is not subject to tax.

Looks like Thailand wants money remitted into Thailand now to support the economy, as well as in the future, so tax residents are given a tax-free window on a rolling basis to remit.

[The Cyclist]

8 minutes ago, NoDisplayName said:

This is my understanding of the PROPOSED rule change:

 

Old rule:  Foreign income (not exempt by DTA) earned in prior years is not assessable.  Foreign income (not exempt by DTA) remitted in same year is assessable.

 

New rule:  Foreign income (not exempt by DTA) earned prior to 2024 is not assessable.  Foreign income (not exempt by DTA) earned after 2023 remitted in any year is assessable.

 

Your understanding is wrong ( IMO )

 

You are confusing 2 things.

 

1. Thai Domestic Tax Policy / Law

 

2. And International Bilateral Agreements ( DTA's  )

 

To put it simply

 

If you are a Thai Tax Resident, you are subject to Thai Domestic Tax Policy / Law. File as per the laid down threshold limits as laid down here.

 

https://www.rd.go.th/fileadmin/download/english_form/2024/GUIDE_91_67_Complete.pdf

 

An International Agreement ( DTA )  will exempt / limit you from thai Taxes under certain circumstances, dictated by Individual DTA's.

[K2938]

47 minutes ago, The Cyclist said:

An International Agreement ( DTA )  will exempt / limit you from thai Taxes under certain circumstances, dictated by Individual DTA's.

True, but if you do not pay taxes anyway under domestic rules, the question of DTA becomes mute...

[NoDisplayName]

1 hour ago, The Cyclist said:

If you are a Thai Tax Resident, you are subject to Thai Domestic Tax Policy / Law. File as per the laid down threshold limits as laid down here.

 

Yes, but you are only taxed on assessable income.  DTA's (and Thai rules) exempt certain income from taxation, for example US social security.

 

Aside from that, do you see any errors in my understanding of the old/new/proposed rules for taxation of remitted assessable income?

[JackGats]

13 hours ago, NoDisplayName said:

 

 

This is confusing.

 

If you e-filed, why did you visit TRD for a refund?  You would receive the refund letter in the mail.

I visited because through my eFiling accouint,  TRD was requesting supporting documents I didn't have or didn't know what they were. Like "proof of the tax you've paid abroad", "proof that you didn't import money to TH during the tax years" etc. 

 

Note that from some posts I have read on this forum, TRD seldom grants a refund without a fight. The refund proper eventually get sent in the mail of course: they don't hand over cash from a kitty they have in the office.

[NoDisplayName]

4 minutes ago, JackGats said:

I visited because through my eFiling accouint,  TRD was requesting supporting documents I didn't have or didn't know what they were. Like "proof of the tax you've paid abroad", "proof that you didn't import money to TH during the tax years" etc. 

 

Note that from some posts I have read on this forum, TRD seldom grants a refund without a fight. The refund proper eventually get sent in the mail of course: they don't hand over cash from a kitty they have in the office.

 

Were you claiming a foreign tax credit?  That would be....problematic....as the tax forms don't appear to have provisions for that, and local office staff are not familiar with the procedures, if there are any.

 

If refunds for Thai withholding tax on interest and dividends, TRD rarely puts up a fight.

[The Cyclist]

11 hours ago, NoDisplayName said:

Yes, but you are only taxed on assessable income.  DTA's (and Thai rules) exempt certain income from taxation, for example US social security.

 

Just read the above sentence again.

 

Sure. DTA's will exempt certain incomes from Thai Taxation.

 

What DTA's do not do. Is exempt you from complying with Thai Domestic Tax Policy / Law if you are a Thai Tax Resident.

 

And we all know what the thresholds are for filing a tax return.

 

I can fully accept that the term " Assessable income " is currently as clear as mud.

 

A DTA does not state that XX income is considered " Non Assessable Income " under Thai Tax Law. They normally state only taxable in XX Country.

 

Despite what happened for years and decades. The term " Only Taxable in XX Country " has never meant " Non Assessable " in Thailand.

[JackGats]

1 hour ago, NoDisplayName said:

 

Were you claiming a foreign tax credit?  That would be....problematic....as the tax forms don't appear to have provisions for that, and local office staff are not familiar with the procedures, if there are any.

 

If refunds for Thai withholding tax on interest and dividends, TRD rarely puts up a fight.

No foreign tax credit. Only withholding tax on Thai dividends.

[NoDisplayName]

35 minutes ago, The Cyclist said:

Despite what happened for years and decades. The term " Only Taxable in XX Country " has never meant " Non Assessable " in Thailand.

 

Oh, nonono, we're not gonna start that again.

[NoDisplayName]

6 minutes ago, JackGats said:

No foreign tax credit. Only withholding tax on Thai dividends.

 

That is surprising, must be some other factors involved.

 

I've filed multiple times online, provided requested bank withholding statements and dividend receipts, always gotten a refund.

 

But this is............

[The Cyclist]

33 minutes ago, NoDisplayName said:

 

Oh, nonono, we're not gonna start that again.

 

Yes, I quite agree, which is why I also shut it down yesterday.

[JackGats]

22 minutes ago, NoDisplayName said:

 

That is surprising, must be some other factors involved.

 

I've filed multiple times online, provided requested bank withholding statements and dividend receipts, always gotten a refund.

 

But this is............

The only mistake I did was to upload a withholding statement (from TSD) in jpeg format. That statement was not very legible. But I brought good PDF copies to the TRD office. Also, TRD painstaikingly checked my bank account savings book to see if every dividend paid matched the amount credited to my account. What this checking was all in aid of I wonder. If any checking had to be done, they by myself, to make sure my broker was not cheating me out. Neither did TRD take my word for it on my sole remittance in 2024. TRD checked my savings book to make sure there were no other remittances.

[oldcpu]

5 hours ago, The Cyclist said:

What DTA's do not do. Is exempt you from complying with Thai Domestic Tax Policy / Law if you are a Thai Tax Resident.

 

And we all know what the thresholds are for filing a tax return.

 

I can fully accept that the term " Assessable income " is currently as clear as mud.

 

A DTA does not state that XX income is considered " Non Assessable Income " under Thai Tax Law. They normally state only taxable in XX Country.

 

Despite what happened for years and decades. The term " Only Taxable in XX Country " has never meant " Non Assessable " in Thailand.

 

Yes ... but as likely you note Royal Decree No. 18 B.E. 2505 (1962) which notes per specifics in some Double Tax Agreements (DTA), some types of foreign income for some countries can be tax exempt in Thailand. 

 

The view of many is that means exempt from the Thailand tax calculation, and hence is not to be considered assessable income.  Obviously this depends on the wording of he DTA.

 

 

[The Cyclist]

3 minutes ago, oldcpu said:

Yes ... but as likely you note Royal Decree No. 18 B.E. 2505 (1962) which notes per specifics in some Double Tax Agreements (DTA), some types of foreign income for some countries can be tax exempt in Thailand. 

 

That has never been in dispute.

 

4 minutes ago, oldcpu said:

The view of many is that means exempt from the Thailand tax calculation, and hence is not to be considered assessable income.  Obviously this depends on the wording of he DTA.

 

DTA's do not mention " Assessable Income " The reason for that is simple.

 

" Assessable Income " is a term specific to Thai Domestic Tax Policy / Law. A DTA is an International Agreement, totally separate from Thai Domestic Tax Law / Policy.

 

I also understand what has been happening for the past 15 years  and how many would come to that view. What happened in the past ( Where nobody cared less ) is not an indication of how things will continue in the future.

 

The 2 must be seen as seperate entities.

 

* An International agreement

 

* Thai Domestic Tax Policy / Law, which now applies to anyone who spends 180 days or more in Thailand in a tax year.