Taxation of worldwide income for Thailand Tax Residents?

[kiwikeith]

22 hours ago, kiwikeith said:

If you  have have a tax agreement with Thailand, and you pay tax on that income in your country of earning, then it may only be subject to an adjustment in the rate you paid in your country, but according to the article you wont have to pay Tax until after 2026, correct me if im wrong, thanks.

I download my Tax certificates from the Bank and have them ready, which show I pay tax in NZ, I can also split the income with my wife

The only part of the article I was concerned if accurate, was not required to pay tax until after 2026

Dual tax agreements are yet to be seen how the tax dept will interpret them.

[Presnock]

19 minutes ago, kiwikeith said:

The only part of the article I was concerned if accurate, was not required to pay tax until after 2026

Dual tax agreements are yet to be seen how the tax dept will interpret them.

well starting last year, any earned money from outside Thailand could be remitted to Thailand and there is a chart on taxes based on what was remitted.  Now they are saying that it seems this new possible one (who knows for sure yet - NO Person) last year and this year no taxes on the remitted income>  They also say that maybe it might be possible to get a refund if one did pay on 2024 income but most on this forum don't believe that there will be any refund.  The reason for this possible change is that because of that 2024 change, fewer Thais and expats remitted as much money as they normally would it seems (and was reported as such) so that by Sept the end of the revenue collection period, they figure that they will end up short some 20 Billion - that is BILLION- baht so thus this possible relax on 2025 remittances but they had better hurry as the year is 5 months old already.  Well 2024 had to pay in early 2025 and 2025 have to pay in early 2026 but 2026 would return to normal supposedly which would need to be paid in 2027.  But until this new decree comes out, people are only guessing.  There are numerous interviews on the taxing schemes in Thailand that the Fnance Minister would like to change to, if you are interested you can google "Thai tax changes proposed "- there are many from since the OECD agreement signed by Thailand in 2023 summer time and since then, Thailand has participated in many OECD functions as they aspire to full membership which would mean a different tax system especially for the expat tax residents.  Many on this forum come from Bangkok Post or Thai-Examiner.  

[tlcwaterfall]

2 hours ago, kiwikeith said:

The only part of the article I was concerned if accurate, was not required to pay tax until after 2026

Dual tax agreements are yet to be seen how the tax dept will interpret them.

Very much doubt local Tax offices will understand any Double taxation agreements.

[Presnock]

6 minutes ago, tlcwaterfall said:

Very much doubt local Tax offices will understand any Double taxation agreements.

Yes that has been a problem yet some of the DTA's are decades old but it seems not a lot of contact among the branches and hqs.  In any case, as you will have already noticed about that change for last year - make sure you have valid documentation to cover whatever you claim.  but so far all indications that I have noticed say that DTA's as treaties between Thailand and 61 countries will remain valid so possibly no problem.   I have an LTR so no taxes on foreign income which is also covered by the DTA and Royal Decree but I wonder if 9 years from now that exemption will remain.

[K2938]

Today new Bkk Post article on taxation with lots of details

 

https://www.bangkokpost.com/business/general/3041421/new-approach-to-overseas-income-aims-to-spur-inflows

[Thailand J]

1 hour ago, K2938 said:

Today new Bkk Post article on taxation with lots of details

Thank you for the link.

The article does not mention possible exemption of income earned prior to Jan 2024 as previous articles did.

I am more confused.

[yozah]

1 hour ago, K2938 said:

Today new Bkk Post article on taxation with lots of details

 

https://www.bangkokpost.com/business/general/3041421/new-approach-to-overseas-income-aims-to-spur-inflows

Why the fck article is giving a summary of the (current?) foreign source taxing rules at the latter part? What a confusing mess of an article.

[CallumWK]

1 hour ago, K2938 said:

Today new Bkk Post article on taxation with lots of details

 

https://www.bangkokpost.com/business/general/3041421/new-approach-to-overseas-income-aims-to-spur-inflows

 

Wow, it even gets better.

 

A tax specialist who requested anonymity said in cases where a taxpayer has income from a foreign source and that income has already been taxed in the source country, if the source country has a DTA with Thailand when that income is brought into Thailand, it may be eligible for a tax credit for the tax paid to the source country.

However, the calculation of the tax credit can be complex, and each country that has a DTA with Thailand may have certain specific provisions that differ, resulting in variations in the tax computation details.

According to the source, when claiming a tax credit under a DTA, the tax credit must not exceed the tax liability payable in Thailand.

The highest personal income tax rate in Thailand is 35%. Therefore, if the income tax paid abroad was at a rate of 40%, the Thai tax credit cannot exceed the domestic tax liability, which is capped at 35%.

 

So if I have a pension in my home country, on which I obviously get taxed there, and I remit the income to Thailand, I get that tax refunded.

Are that pigs I see flying through the sky?

[K2938]

2 minutes ago, CallumWK said:

So if I have a pension in my home country, on which I obviously get taxed there, and I remit the income to Thailand, I get that tax refunded.

Are that pigs I see flying through the sky?

You do.  At best the Thai tax rate will be zero, they will not refund you anything.

[zz4096]

15 minutes ago, CallumWK said:

 

Wow, it even gets better.

 

A tax specialist who requested anonymity said in cases where a taxpayer has income from a foreign source and that income has already been taxed in the source country, if the source country has a DTA with Thailand when that income is brought into Thailand, it may be eligible for a tax credit for the tax paid to the source country.

However, the calculation of the tax credit can be complex, and each country that has a DTA with Thailand may have certain specific provisions that differ, resulting in variations in the tax computation details.

According to the source, when claiming a tax credit under a DTA, the tax credit must not exceed the tax liability payable in Thailand.

The highest personal income tax rate in Thailand is 35%. Therefore, if the income tax paid abroad was at a rate of 40%, the Thai tax credit cannot exceed the domestic tax liability, which is capped at 35%.

 

So if I have a pension in my home country, on which I obviously get taxed there, and I remit the income to Thailand, I get that tax refunded.

Are that pigs I see flying through the sky?

 

You've chosen to misunderstand that section of the BP article. I suggest you talk to a tax professional because I sure as hell ain't explaining it to you for free! 🤣

[KhunHeineken]

14 minutes ago, CallumWK said:

 

Wow, it even gets better.

 

A tax specialist who requested anonymity said in cases where a taxpayer has income from a foreign source and that income has already been taxed in the source country, if the source country has a DTA with Thailand when that income is brought into Thailand, it may be eligible for a tax credit for the tax paid to the source country.

However, the calculation of the tax credit can be complex, and each country that has a DTA with Thailand may have certain specific provisions that differ, resulting in variations in the tax computation details.

According to the source, when claiming a tax credit under a DTA, the tax credit must not exceed the tax liability payable in Thailand.

The highest personal income tax rate in Thailand is 35%. Therefore, if the income tax paid abroad was at a rate of 40%, the Thai tax credit cannot exceed the domestic tax liability, which is capped at 35%.

 

So if I have a pension in my home country, on which I obviously get taxed there, and I remit the income to Thailand, I get that tax refunded.

Are that pigs I see flying through the sky?

No, not refunded, you get tax credits.   

 

This guy explains DTA's quite well. 

 

 

 

[offset]

24 minutes ago, K2938 said:

You do.  At best the Thai tax rate will be zero, they will not refund you anything.

Not quite true they will refund withheld tax from your savings in Thailand if you owe no tax here

[NoDisplayName]

1 hour ago, yozah said:

Why the fck article is giving a summary of the (current?) foreign source taxing rules at the latter part? What a confusing mess of an article.

 

It gets the current rules wrong.

 

Currently, the criteria for collecting personal income tax on income sourced from abroad require that, regardless of whether the money is brought into the country in the year the income is earned or in any subsequent year, it is subject to personal income tax payable to the Revenue Department.
 

It leaves out entirely the 161/162 provision that income earned prior to 2024 can be brought in tax free.  Not sure how much faith can be put into the following statement:

 

He said the ministerial regulation will not have a retroactive effect for income earned before the regulation is enacted....

Because if

 

...the department wants to encourage individuals with foreign income to bring it back and invest in Thailand, which would help increase liquidity and stimulate the domestic economy.
 

Then this will remove the incentive to remit pre-2024 income.

 

[K2938]

1 hour ago, offset said:

Not quite true they will refund withheld tax from your savings in Thailand if you owe no tax here

That is true (if you have no other income and apply for), but I do not think that this was the question of the OP.