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

[The Cyclist]

2 minutes ago, anrcaccount said:

No, you're completely incorrect.

 

A UK Government Pension, as with US Social security,  is non-assessable / exempt and is not required to be listed/declared at all in a Thai tax return. 

 

Of course

 

Every Brit only remits a Government Pension

 

Every American only remits SS

 

The RD will believe those lies every day of the week.

 

3 minutes ago, anrcaccount said:

f it was, the TRD would have been requiring this for many years, and they never have

 

Because they were too lazy, couldn't understand it, it was too much work. What happened previously is not an indicator of what happens in the future.

[The Cyclist]

3 minutes ago, JohnnyBD said:

How would you claim a Tax Exemption from the TRD after reporting a Gov't pension on a tax return when there's no place on the tax return to claim an exemption for that income? Would you also report your pre-2024 remittances? If so, where would you claim an exemption for that on the tax return?

 

Probably in the same manner that would claim a tax credit.

 

By supplying supplementary paperwork. Showing what you are claiming is true.

[JohnnyBD]

8 minutes ago, The Cyclist said:

 

Probably in the same manner that would claim a tax credit.

 

By supplying supplementary paperwork. Showing what you are claiming is true.

Just curious,

Why do you think people need to report a Gov't pension that's exempt or pre-2024 remittances or any other non-assessable income on their tax returns?

I'm just trying to understand where you are getting this from, that everyone needs to report the above mentioned monies on a tax return.

Is a tax firm telling you this, or is it just your opinion?

[anrcaccount]

17 minutes ago, The Cyclist said:

 

Of course

 

Every Brit only remits a Government Pension

 

Every American only remits SS

 

The RD will believe those lies every day of the week.

 

 

Because they were too lazy, couldn't understand it, it was too much work. What happened previously is not an indicator of what happens in the future.

 

Deflecting, irrelevant comments. 

 

Non assessable / exempt income remitted is not required to be listed on a Thai tax return. 

 

Even the predatory "expat" tax agencies agree with this, and that's saying something. 

[The Cyclist]

5 minutes ago, anrcaccount said:

Deflecting, irrelevant comments. 

 

There is nothing deflecting or irrelevant in this

 

Quote

1. Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.

 

https://library.siam-legal.com/thai-law/revenue-code-assessable-income-and-income-tax-sections-40-64/

 

It is there in black and white, I have even made it bold for you.

[anrcaccount]

25 minutes ago, The Cyclist said:

There is nothing deflecting or irrelevant in this

 

Quote

1. Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.

Expand  

 

https://library.siam-legal.com/thai-law/revenue-code-assessable-income-and-income-tax-sections-40-64/

 

It is there in black and white, I have even made it bold for you.

 

Non assessable / exempt income remitted is not required to be listed on a Thai tax return. 

 

This includes UK Government Pensions and US Social Security. 

 

You suggesting otherwise is plain wrong.  

 

 

[The Cyclist]

4 minutes ago, anrcaccount said:

This includes UK Government Pensions

 

Again

 

Quote

1. Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.

 

Can you point out in the Revenue Code, or indeed the UK - Thai DTA where it states Pensions are non assessable or are considered exempt income for Thai Tax Purposes.

 

6 minutes ago, anrcaccount said:

Non assessable / exempt income remitted is not required to be listed on a Thai tax return. 

 

Pensions are stated in the TRC as assessable income . It does not give further breakdown of Pensions that are assessable or non assessable.

[JimGant]

2 hours ago, oldcpu said:

so again - that begs the question, ... is foreign remitted income, referenced in a DTA signed and agreed by Thailand, where DTA notes that Thailand has  no taxation rights on such income, is it still to be included in a Thai tax calculation?

No! That there's no place to include it should be your first clue.

[JimGant]

4 minutes ago, The Cyclist said:

Can you point out in the Revenue Code, or indeed the UK - Thai DTA where it states Pensions are non assessable or are considered exempt income for Thai Tax Purposes.

Article 19 of the UK-Thai DTA:

Any pension paid by the Contracting State or a political subdivision or a local
authority thereof to any individual in respect of services of a governmental nature
rendered to that State or subdivision or local authority thereof shall be taxable
only in that State.

 

Hopefully, you can equate "exempt" with "non assessable."

[The Cyclist]

9 minutes ago, JimGant said:

Article 19 of the UK-Thai DTA:

Any pension paid by the Contracting State or a political subdivision or a local
authority thereof to any individual in respect of services of a governmental nature
rendered to that State or subdivision or local authority thereof shall be taxable
only in that State.

 

Hopefully, you can equate "exempt" with "non assessable."

 

Where does that say a Thai Tax Resident of Thailand does not have to comply with Thailands Domestic Tax Policy ?
 

I know what it says, I also know what it does not say. And i have posted at least twice what Section 40 ( 1 ) says.

 

Pensions are assessable income, which may be

 

* Subject to Thai Tax

 

* Subject to Tax Credits

 

* Not subject to Thai tax as they are only taxable in UK as per an agreed International Agreement.

 

Eh no, Exempt / non assessable are not mentioned in the DTA.

[NoDisplayName]

31 minutes ago, JimGant said:

Article 19 of the UK-Thai DTA:

Any pension paid by the Contracting State or a political subdivision or a local
authority thereof to any individual in respect of services of a governmental nature
rendered to that State or subdivision or local authority thereof shall be taxable
only in that State.

 

Hopefully, you can equate "exempt" with "non assessable."

 

Mayhaps this will help:

 

In general the DTA does not stipulate any specific item of income and tax rate. It provides whether the source or resident country is entitled to tax certain income. If the source country has taxing rights, the income will be subject to tax according to the domestic laws of that country.

....

C.   Elimination of double taxation

The focus of a DTA is the elimination of double taxation. Each DTA may prescribe different methods of elimination of double taxation of a person by the resident country:

(1)   Exemption method

The country of residence does not tax the income which according to the DTA is taxed in the source country.

(2)   Credit method

The resident country retains the right to tax the income which was already taxed in the source country....

 

https://www.rd.go.th/english/21973.html

 

DTA's can (as with US) specify certain income exempt from Thai tax.

 

Exempt = non-assessable = not included in PIT calculation = not entered on tax return

[oldcpu]

1 hour ago, The Cyclist said:

So I file Tax Return as required by Law and then claim a Tax Exemption by providing the evidence that it is a Government Pension, and is only taxable in the UK according to the UK - Thai DTA.
 

If I have a non Government pension, I also file a tax return, provide evidence of tax already paid in the UK, and will be issued with a ax credit that will be offset against any Thai Tax liability.

 

 

You have perked my curiosity here.

 

Please point out specific place in Thai 2024 tax return form where you:

1. claim a Tax Exemption by providing the evidence that it is a Government Pension, and is only taxable in the UK according to the UK - Thai DTA

2.  provide evidence of tax already paid in the UK, that you intend to use to offset  any Thai Tax liability.

 

I asked because I looked , and I spotted NO SUCH PLACE.

 

If there is such a place, it might be helpful to many on this forum.  And if there is no such place, then while you have good intentions, you are simply incorrect.

 

I can not help but think you are basing your thinking on tax experience from a country outside of Thailand, where it is a Global Taxation system, and not a remitted taxation system. 

 

In a remitted taxation system, the Revenue Department nominally only wants to know about foreign remitted income that it can tax. A global tax system wants to know about all of one's global income. 

 

 

[JimGant]

5 minutes ago, oldcpu said:

In a remitted taxation system, the Revenue Department nominally only wants to know about foreign remitted income that it can tax. A global tax system wants to know about all of one's global income. 

Actually, if we go to a global tax system, Thailand still won't want to know about income it cannot tax -- like my US govt pension and Social Security. Those figures need not ever be introduced into a Thai tax return -- at least for now, where they're not interested in non assessable income.

 

9 minutes ago, oldcpu said:

I asked because I looked , and I spotted NO SUCH PLACE.

 

If there is such a place, it might be helpful to many on this forum.  And if there is no such place, then while you have good intentions, you are simply incorrect.

 

Incorrect -- and good intentions questionable.

[MangoKorat]

11 minutes ago, oldcpu said:

You have perked my curiosity here.

Very short on time and haven't read any of the posts that lead to this so I could be talking complete rubbish but I just want to point out that there is a difference between a UK Government Pension and a UK State Pension.

 

I read an article some months back that stated that under the UK/Thai DTA a UK Government Pension (paid to ex government and public employees) would not be assessable for tax in Thailand whilst a State Pension is.

 

Simply pointing out the difference between the two pensions which is often confused.

[Sheryl]

2 hours ago, The Cyclist said:

 

Really ?

 

 

Agreed with the above ?
 

TRC Section 40 Assessable income

 

 

I'm only dealing pensions here.

 

A Pension over 60k / 120k / 220k a year is assessable income according to Section 40 ( 1 ) of the Thai Revenue Code. And as a Thai Tax Resident I should file a tax return.

 

Agreed ?

 

So I file Tax Return as required by Law and then claim a Tax Exemption by providing the evidence that it is a Government Pension, and is only taxable in the UK according to the UK - Thai DTA.
 

If I have a non Government pension, I also file a tax return, provide evidence of tax already paid in the UK, and will be issued with a ax credit that will be offset against any Thai Tax liability.

 

The same process will apply to all the sources of income as listed here

 

https://library.siam-legal.com/thai-law/revenue-code-assessable-income-and-income-tax-sections-40-64/

There is no way to claim a tax exemption as you describe.

 

The process is to not declare income that is tax exempt under DTA to begin with.

 

A pension is normally assessable yes  but (assuming you mean a UK military or other government pension and not the State OAP) the terms of the DTA override this. 

 

And whole point will be irrelevant by next year anyhow if planned chsnge goes through.

 

[mudcat]

Yet again, another case of TRD PowerPoint slides substituting for actual training - see the last slide in this 'training' presentation:

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

 

Note that the above presentation ignores DTAs methodology for dealing with foreign income, i.e. by exemption or credit as described in Sections 3.1 and 3.2 of https://www.rd.go.th/english/21973.html 

 

[The Cyclist]

8 minutes ago, mudcat said:

Note that the above presentation ignores DTAs methodology for dealing with foreign income, i.e. by exemption or credit as described in Sections 3.1 and 3.2 of https://www.rd.go.th/english/21973.html 

 

Other than it being a bad translation, I don't see too much wrong with it.

 

Exemption mention should read 

 

The Country of Residence ( Thailand ) does not tax  the Income which according to the DTA is only Taxable in  the source Country.

 

Credit method is straight forward.

 

If it is taxable in both Countries, a tax credit will be given, up to the amount of tax paid in the other Country, this tax credit will be offset against any Thai Tax owed.

 

The exemption method is interesting. Why is it even listed / mentioned, if there is no need ( according to some )  to file such incomes.

 

And goes right back to. It says Thailand won't tax, it doesn't say you don't have to file.

[K2938]

15 hours ago, The Cyclist said:

Where does that say a Thai Tax Resident of Thailand does not have to comply with Thailands Domestic Tax Policy ?
 

I know what it says, I also know what it does not say. And i have posted at least twice what Section 40 ( 1 ) says.

 

Pensions are assessable income, which may be

 

* Subject to Thai Tax

 

* Subject to Tax Credits

 

* Not subject to Thai tax as they are only taxable in UK as per an agreed International Agreement.

 

Eh no, Exempt / non assessable are not mentioned in the DTA.

That is just a basic principle of how DTAs work:

"Treaty overrides domestic laws Thus, DTAs supersede 'any written law' – ie not just tax laws. This principle has been repeatedly followed and reinforced by the courts; it says that if there is a conflict between domestic law (tax laws, labour laws, etc) and the treaties, the treaties will prevail"

[The Cyclist]

3 minutes ago, K2938 said:

That is just a basic principle of how DTAs work:

"Treaty overrides domestic laws Thus, DTAs supersede 'any written law' – ie not just tax laws. This principle has been repeatedly followed and reinforced by the courts; it says that if there is a conflict between domestic law (tax laws, labour laws, etc) and the treaties, the treaties will prevail"

 

This is correct

 

But it is not the point I am making or putting forward.

 

DTA's, where they exist, take precedent over Domestic Law, They do not stop you from complying with Domestic Law.

 

That principle  also applies to any type of International Agreement.

 

 

[mudcat]

2 hours ago, mudcat said:

The reason I presented the PowerPoint slide first is that is what I, and probably many expats were presented with along with a demand for documentation and amount of income from abroad.  In my case I took it up with the officer's superior and presented chapter and verse about why my Social Security and Government pension were none of their business.  This was followed by a discussion of my wife's inheritance and Social Security survivor benefit would be Tax Exempt.  Simple arguments will not prevail against PowerPoint slides - you need as much Thai RD documentation in both Thai and English to present.  

 

2 hours ago, mudcat said:

 

Yet again, another case of TRD PowerPoint slides substituting for actual training - see the last slide in this 'training' presentation:

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

 

Note that the above presentation ignores DTAs methodology for dealing with foreign income, i.e. by exemption or credit as described in Sections 3.1 and 3.2 of https://www.rd.go.th/english/21973.html 

 

 

[Equatorial]

22 minutes ago, The Cyclist said:

DTA's, where they exist, take precedent over Domestic Law, They do not stop you from complying with Domestic Law.

 

 

I have been following this extremely entertaining exchange for a few days now.

 

I especially enjoyed this last post, which effectively says - DTA's take precedent over Domestic Law. Therefore, Domestic Law must be followed when contradicted by the DTA. 

 

This is on the par with Zen koans. I appreciate the way @The Cyclist stimulates meditative contemplation and facilitates enlightenment by disrupting conventional thinking and helping us transcend the limitations of logical reasoning.

[The Cyclist]

2 minutes ago, Equatorial said:

 

I have been following this extremely entertaining exchange for a few days now.

 

I especially enjoyed the last one - DTA's take precedent over Domestic Law. Therefore, Domestic Law must be followed when contradicted by the DTA. 

 

This is on the par with Zen koans. I appreciate the way @The Cyclist stimulates meditative contemplation and facilitates enlightenment by disrupting conventional thinking and helping us transcend the limitations of logical reasoning.

 

Brilliant

 

Would be even better if it actually related to anything I have said.

 

Which is

 

1. Thai Tax Residents need to comply with Thai Tax Law, which is the Revenue Code.

 

2. DTA's / Certain Visa's / Certain others, may exempt you from paying tax in Thailand, depending on the source of Income.

 

None of them give you a blanket amnesty from complying with Thai Tax Law.

[Burma Bill]

For all of you who may be fed up with Thailand and its bureaucracy regarding visas, income tax and mandatory money requirements. 

For reference 23rd May 2025:

 

Cambodia's 10-year Golden Visa, also known as the CM2H (Cambodia My 2nd Home) program, allows foreigners to reside in Cambodia for 10 years by investing a minimum of $100,000 in real estate. This program offers a pathway to Cambodian citizenship after five years of residency and does not require minimum stay requirements. 

 

Key Features of the CM2H Program:

• Ten-year visa: Applicants receive a renewable, 10-year visa with multiple entry/exit privileges. 
   
• Investment Requirement: A minimum investment of $100,000 in real estate is required to qualify. 
   
• Path to Citizenship: After five years of residency, CM2H holders can apply for a Cambodian passport. 
   
• No Minimum Stay: There are no minimum physical presence requirements to maintain the CM2H visa, according to IMI Daily. 
   
• Family Inclusion: Family members can be included in the application process. 
   
• Work Permit: Successful applicants are also granted permission to work in Cambodia, but a work permit is required. 
   

Benefits of the CM2H Program:

• Long-term residency: The 10-year visa allows for extended stays and the opportunity to build a life in Cambodia. 
   
• Potential for citizenship: The path to citizenship after five years is a significant advantage. 
   
• Access to a stable and growing economy: Cambodia is experiencing economic growth and is a safe and secure country. 
   
• International community: Cambodia is home to a growing international community, providing opportunities for networking and social connections. 
   

For more information about the CM2H program, you can visit the official website of Cambodia My 2nd Home (CM2H) or other reputable sources like IMI Daily and Offshore in Asia. 

[oldcpu]

On 5/22/2025 at 10:44 AM, The Cyclist said:

Would be even better if it actually related to anything I have said.

 

Which is

 

1. Thai Tax Residents need to comply with Thai Tax Law, which is the Revenue Code.

 

2. DTA's / Certain Visa's / Certain others, may exempt you from paying tax in Thailand, depending on the source of Income.

 

I don't think anyone disagrees with that.

 

On 5/22/2025 at 10:44 AM, The Cyclist said:

None of them give you a blanket amnesty from complying with Thai Tax Law.

 

I don't think anyone disagrees with that.

 

Where the disagreement lay is where some ignore Royal Decrees associated with Thai taxation (which also form part of Thai tax law), and have a different interpretation as to how the Royal Decrees and DTAs can affect the definition of 'assessable income' (in some cases (and not all cases) where the DTAs clearly note a foreign income is NOT taxable by Thailand). 

 

The Royal Decree (legally, consistent with Thai tax law) notes such income is exempt taxation, and by inference, consistent with other mentions in Thai tax law for some exemptions, is exempt from the Thai tax calculation.

 

Again, all complying with Thai law.

 

And if not to be included in the Thai tax calculation, it means such exempt remitted foreign income is (1) not to be included in the assessment if a Thai tax return is needed, AND further (2) if a tax return is to be submitted (for other reasons) any exempt income per (a) the Royal Decree and Thai tax law and also (b) has no place in the tax return itself as a exemption/deduction) is not to be included as a remitted income in the tax return.

 

Why? ..  because per Royal Decree, which forms part of Thai tax law, such income is exempt from falling under the assessable income category by being exempt from the Thai tax calculation. Obviously this is only for some, but not all remitted foreign income, dependent on agreed DTA wording with Thailand.

 

Again, ALL COMPLYING WITH THAI TAX LAW. 

 

So on that need to comply with Thai tax law we agree. 

 

Only I note  some refuse to consider the implications of the Royal Decree where Royal Decrees can be part of Thai tax law.

 

[oldcpu]

1 hour ago, Burma Bill said:

For all of you who may be fed up with Thailand and its bureaucracy regarding visas, income tax and mandatory money requirements. 

For reference 23rd May 2025:

 

Cambodia's 10-year Golden Visa, also known as the CM2H (Cambodia My 2nd Home) program, 

 

 

I happen to like Cambodia.  I have visited there a number of times.

 

However - for me the Cambodian hospitals are simply not up to par.  i would MUCH rather put up with some extra bureaucracy to be closer to far far far superior hospitals (in Thailand), superior than what Cambodia has to offer.

 

Each to their own.

[Jingthing]

This may deserve it's own topic sooner or later, but I'll take a first stab now.

This is about IF the recent proposal about only older income remitted would be taxable abroad.

Well, I'll give my example to frame my question which might be of interest to others.

A U.S. citizen with only remitted income from Social Security (not taxable in Thailand) and a traditional IRA account (taxable in Thailand).

My SS income is piling up all the time in a U.S. account. I don't do monthly transfers. I do big chunks once or twice a year.

So all that is not relevant to Thai taxation.

But lets say I do a taxable event IRA distrubition to an account already loaded with older SS money.

All this setup to ask this question.

If I accounted for this based on First In, First Out which is a common standard, by the time I get to the IRA money it might be too old to be tax exempt in Thailand.

So much better for me is to account based on LAST IN, FIRST OUT accounting which to my limited knowledge is a standard method for inventory (but this isn't inventory).

So for example in a given year I had 10K IRA income in April and I remitted it right away I wouldn't be at risk of that chunk of money aging into Thai taxable EVEN IF the account was already loaded with SS income (which came much earlier.

So the ultimate question is if applied consistently would Thai Revenue accept LAST IN, FIRST OUT as a legitimate accounting method in such cases? Or not?

[JohnnyBD]

47 minutes ago, Jingthing said:

This may deserve it's own topic sooner or later, but I'll take a first stab now.

This is about IF the recent proposal about only older income remitted would be taxable abroad.

Well, I'll give my example to frame my question which might be of interest to others.

A U.S. citizen with only remitted income from Social Security (not taxable in Thailand) and a traditional IRA account (taxable in Thailand).

My SS income is piling up all the time in a U.S. account. I don't do monthly transfers. I do big chunks once or twice a year.

So all that is not relevant to Thai taxation.

But lets say I do a taxable event IRA distrubition to an account already loaded with older SS money.

All this setup to ask this question.

If I accounted for this based on First In, First Out which is a common standard, by the time I get to the IRA money it might be too old to be tax exempt in Thailand.

So much better for me is to account based on LAST IN, FIRST OUT accounting which to my limited knowledge is a standard method for inventory (but this isn't inventory).

So for example in a given year I had 10K IRA income in April and I remitted it right away I wouldn't be at risk of that chunk of money aging into Thai taxable EVEN IF the account was already loaded with SS income (which came much earlier.

So the ultimate question is if applied consistently would Thai Revenue accept LAST IN, FIRST OUT as a legitimate accounting method in such cases? Or not?

I have a simple solution to your hypothetical situation. Just open a new separate bank account to put your taxable IRA distributions in, then wire those new monies to Thailand.

 

I know you're just posing a hypothetical, but there's no need to cause yourself problems by mixing new monies (not taxable in Thailand), with old monies which would be taxable under new rules if implemented.

[Jingthing]

3 minutes ago, JohnnyBD said:

I have a simple solution to your hypothetical situation. Just open a new separate bank account to put your taxable IRA distributions in, then wire those new monies to Thailand. No need to cause yourself any problems by mixing your old monies with your new monies. Problem solved.

I agree. I thought of that of course and it is much more desirable.

However, I don't know of any way to open a  new U.S. account at this point.

Not a U.S. resident for decades and no U.S. driver's license so very difficult to fake it.

Yes I already have a SDFCU account which can be opened with a passport.

[JohnnyBD]

12 minutes ago, Jingthing said:

I agree. I thought of that of course and it is much more desirable.

However, I don't know of any way to open a  new U.S. account at this point.

Not a U.S. resident for decades and no U.S. driver's license so very difficult to fake it.

Yes I already have a SDFCU account which can be opened with a passport.

You may be able to open an additional acct with SDFCU since you already have one with them.

 

Last year when I found out about the new Jan 1, 2024 rules, I opened an additional acct with Chase Bank to separate my SS (non-assessable income) from my private pension deposits, so I wouldn't mix them. I did the same with Fidelity by opening additional accts to keep my 2023 & 2024 Income separate. Worked out good for me for tracking purposes.

[topt]

4 hours ago, Jingthing said:

So the ultimate question is if applied consistently would Thai Revenue accept LAST IN, FIRST OUT as a legitimate accounting method in such cases? Or not?

This was discussed (argued.......555) at length in one or more of the original tax threads.

From memory the supposed conclusion was that whichever method you decided on was acceptable as you would have to present it to the RD if it was ever queried.

I seem to remember @JimGant being heavily involved in the discussion. Apologies if I have that wrong.