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

[NoDisplayName]

8 minutes ago, Jingthing said:

The funny thing about that is that the vast majority of social security recipients are NOT taxed federally as their overall income excludes that, so the benefit  would only be to wealthier Americans. (See a pattern?) Also that policy would mean that the mandated about 20 percent cut would happen years sooner if no other funding changes are made. So be careful what you wish for.

 

Up to 85% of a taxpayer's benefits may be taxable if they are:

• Filing single, head of household or qualifying widow or widower with more than $34,000 income.
• Married filing jointly with more than $44,000 income.
• Married filing separately and lived apart from their spouse for all of 2021 with more than $34,000 income.
• Married filing separately and lived with their spouse at any time during 2021.

 

https://www.irs.gov/newsroom/irs-reminds-taxpayers-their-social-security-benefits-may-be-taxable

 

I shall wish.

[anrcaccount]

1 hour ago, Jingthing said:

I find your argument totally specious.

The environment has radically changed.

Before now, pretty much nobody, certainly not retired expats, was filing or paying Thai tax based on remittances during the current year, regardless of the vehicle. 

And TRD wasn't interested either.

Have you heard of something called POLITICS and changes of government?

The priorities and targets changed and expats would need to be totally in denial not to see that.

 

No, I disagree anything has 'radically changed'.

 

Nothing has changed, apart from 2 internal directives being released.

 

No new laws have been passed. No new enforcement related directive have been issued, no media releases have been issued. There is zero evidence the TRD has changed their focus or intention to enforce any taxation on foreign remittances. The TRD haven't stated anything is changing. There's no evidence any 'priorities or targets' have changed.  

 

The main ones making noise are the (IMO predatory) expat tax firms that have sprung up- I find their 'infotainment' as another poster nicely puts it, equally specious.

I'm still, yet to see a report of any significant foreign remittance, actually being taxed. 

[Jingthing]

5 minutes ago, anrcaccount said:

 

No, I disagree anything has 'radically changed'.

 

Nothing has changed, apart from 2 internal directives being released.

 

No new laws have been passed. No new enforcement related directive have been issued, no media releases have been issued. There is zero evidence the TRD has changed their focus or intention to enforce any taxation on foreign remittances. The TRD haven't stated anything is changing. There's no evidence any 'priorities or targets' have changed.  

 

The main ones making noise are the (IMO predatory) expat tax firms that have sprung up- I find their 'infotainment' as another poster nicely puts it, equally specious.

I'm still, yet to see a report of any significant foreign remittance, actually being taxed. 

You missed official announcements from Thai officials on these matters. I understand your POV but the practical reality is that the rubicon has been crossed and you can't reverse that

 

[Yumthai]

1 hour ago, NoDisplayName said:

Stick with capital appreciation funds, or stocks, not paying dividends, and you pay no US tax.  Sell and remit in a year not tax-resident in Thailand and your gains are not taxed here, either.

That's the way to go for US nonresident alien investors. In a year being non tax resident in Thailand, not only you can sell and remit asset proceeds covering one or more years living expense, but also set in stone end-of-year offshore accounts cash balances for later tax free remittances. Depending on one's wealth this strategy could cover many tax exempted years.

[jmd8800]

To throw one more question into the mix:

 

As a US citizen what is the value of my Social Security income for tax purposes in Thailand? Is it the gross income before the Medicare premiums are deducted, or the amount after Medicare premiums are deducted, which is then deposited into the bank.

 

 

[NoDisplayName]

1 minute ago, jmd8800 said:

To throw one more question into the mix:

 

As a US citizen what is the value of my Social Security income for tax purposes in Thailand? Is it the gross income before the Medicare premiums are deducted, or the amount after Medicare premiums are deducted, which is then deposited into the bank.

 

 

 

Zero.

 

It's non-assessable.

Exempt by DTA.

[jmd8800]

6 minutes ago, NoDisplayName said:

 

Zero.

 

It's non-assessable.

Exempt by DTA.

You still have to determine what amount is non-assessable.

[potless]

There may be a few super wealthy U.S. expats out here so I am just putting this out in case they may be unaware. I read that the USA estate and gift tax credit, currently $13.61 million, rising to $13.99 million in 2025, is due to halve in 2026. Just saying.

[NoDisplayName]

19 minutes ago, jmd8800 said:

You still have to determine what amount is non-assessable.

 

Super easy, barely an inconvenience!

 

US sociable security is 100% non-assessable.

 

If that is your only source of foreign income, you have no assessable remittances to declare, no need to file a return, and no need to get a TIN.

 

[anrcaccount]

37 minutes ago, Yumthai said:

2 hours ago, NoDisplayName said:

Stick with capital appreciation funds, or stocks, not paying dividends, and you pay no US tax.  Sell and remit in a year not tax-resident in Thailand and your gains are not taxed here, either.

That's the way to go for US nonresident alien investors. In a year being non tax resident in Thailand, not only you can sell and remit asset proceeds covering one or more years living expense, but also set in stone end-of-year offshore accounts cash balances for later tax free remittances. Depending on one's wealth this strategy could cover many tax exempted years.

 

Sure, this is rock solid, couple of thoughts:

 

First, if you don't want to leave Thailand to execute this, it seems you simply sell, rebuy something else, sell it at cost and remit. Also rock solid, you can prove the source of the remittance as the proceeds of the sale of a fund/bond/some kind of asset/watch with no gains. Remittance of original capital is not taxable. 
 
Second , let's acknowledge the nonsensical ludicrousness, that Thailand will allow you to remit as much as you want in one year, tax free, as long as you aren't there more than 179 days. Then, the next year when you want to stay there full time (huh, maybe to spend / 'invest' the funds) you'll be taxed if you remit more in!

 

Third, 'setting in stone offshore cash balance ', that's an interesting way of putting it. Do you think an offshore cash balance as at 31/12/2023 for example of $500K, means you can remit $500K to Thailand any time in the future tax free? ( regardless of what happens to that $500K itself) . I guess, even if in reality you lost the entire $500K on black at the roulette table on 01/01/2024, you can still show that bank statement, and send the funds from any other source, including technically assessable income. Remittance taxation is a joke, right?

[NoDisplayName]

16 minutes ago, anrcaccount said:

 

Sure, this is rock solid, couple of thoughts:

 

 

 

First -  Seems sensible, until it's not.  If audited (unlikely), what documentation would be required, and how far back would it need to go?  Prior year?  Pre-2024? Let 'em try to track capital that has been recycled continuously over the course of a few years!  The concern is, they can't figure it out, and as with the IRS you're guilty until proven innocent, you pay the tax and have to appeal.

 

Second -  That's the way it's always worked.  Bring in 20 million to buy a luxury condo, earned non-resident + remitted non-resident = no PIT.  That won't change, even if we've lost the prior-year loophole, but some poor souls may be asked to prove it.

 

Third - Remittance taxation is a joke.  Unless your bank account is isolated from your brokerage is isolated from your beanie baby collection, and the remittance immediately follows the transaction, being sent directly from the isolated account to your Thai account without intermediaries......well, that's why self-determination is a thing!  It is what I say it is because I say it.