Legal Position? Based Los, Working Remotely Uk

[katyb]

Afternoon,

I’ve had a look for the answer to this on TV and can’t thing anything, but I’ve got a feeling it might concern a few of us……… so I would like to ask, does anyone know what is the legal position regarding work permits for those of us who stay here long term but work remotely, servicing businesses in Europe.

I run a UK based internet business. My clients are mainly UK, some European and USA, but none are Thai. So, although I am physically working here on a PC, none of my business or income is actually coming from Thailand. I don’t have a Thai bank account so all funds are held within UK. I have a Non O from UK and no work permit. I go back twice a year for 4 – 6 weeks each time, renew visa and come back

The more time I spend here, the more people are starting to ask me how I can afford to keep coming back and staying so long, as I am a long way off retiring. Maybe they think I have a trust fund!? But in reality, I just work here as I do in UK and I just can't help feeling uncomfortable sometimes as I really do not know the answer.

So, please does anybody know – what is the law regarding this? If this is illegal is there anything I can do about it or do I just keep my head down? I’d rather be straight about it.

Many thanks in advance.

Kate

[lopburi3]

You spelled it out - you work here. All work in Thailand by a foreigner requires a work permit. So in effect you are flying below the radar at present. As you are concerned would suggest you contact Sunbelt or other legal firm to discuss your options.

1. You can become legal but it is a legal process and you should have legal firm such as Sunbelt help set it up.

2. You can continue. As long as you are not in active competition with others here it is not likely to become an issue and would be very hard to prove (with no physical business activity).

[katyb]

You spelled it out - you work here. All work in Thailand by a foreigner requires a work permit. So in effect you are flying below the radar at present. As you are concerned would suggest you contact Sunbelt or other legal firm to discuss your options.

1. You can become legal but it is a legal process and you should have legal firm such as Sunbelt help set it up.

2. You can continue. As long as you are not in active competition with others here it is not likely to become an issue and would be very hard to prove (with no physical business activity).

Thanks very much for your advice. I had better look into it a bit more. I like it here too much to be booted out! I'll give Sunbelt a shout.

Thanks again.

Kate

[TCA]

Hi Kate

Can I ask if you are still paying UK tax as a UK resident? If you're visiting the UK less than 90 days every year it sounds like you may be a candidate for (or are already) non UK resident. I'm in a similar position to yourself (Non O visa, not retired and not employed in Thailand) and exploring the possibilities but struggling for good answers.

I have read (but have had no confirmation) that as a Thai tax resident (you are one by simply staying in Thailand for 180 days or more), you're liable to tax on income from sources within Thailand and on income from outside the country brought into Thailand. Apparently not on "savings" brought into the country or income left elsewhere. No idea if this is an old regulation as nothing recent that I've seen corroborates this.

Interested to hear what Sunbelt have to say, so please keep us updated.

TCA

[katyb]

Hi Kate

Can I ask if you are still paying UK tax as a UK resident? If you're visiting the UK less than 90 days every year it sounds like you may be a candidate for (or are already) non UK resident. I'm in a similar position to yourself (Non O visa, not retired and not employed in Thailand) and exploring the possibilities but struggling for good answers.

I have read (but have had no confirmation) that as a Thai tax resident (you are one by simply staying in Thailand for 180 days or more), you're liable to tax on income from sources within Thailand and on income from outside the country brought into Thailand. Apparently not on "savings" brought into the country or income left elsewhere. No idea if this is an old regulation as nothing recent that I've seen corroborates this.

Interested to hear what Sunbelt have to say, so please keep us updated.

TCA

Hi TCA,

So far, I have spent more than 90 days a year in UK, but not much more. So I am still classed as Uk Resident.

I hope what you say about being liable for Tax in Thailand if you stay more that 180 days isn't true! That would be bad news.

Well, I'm still confused, so I'm going to talk to Sunbelt. I'll post any info I find out.

Kate

[TCA]

90 days is an average over 3 or 4 years as far as I know.

As for the 180 days thing, read here from the Thai consulate in Hull:

http://www.thaiconsul-uk.com/pdfs/Gp%20%20...Information.pdf

But if you don't work in Thailand or at least can't get a work permit to do so, then how can you pay taxes? Catch 22.

You'll also see mention of the "income derived from sources outside of Thailand" which doesn't specify whether this has to be remitted to Thailand to be taxable there - which was admittedly only something I've seen banded about on this forum and elsewhere.

Good luck with Sunbelt.

Edited July 9, 2008 by TCA

[poshthai]

Hi kate,have you got a few sponsors back in the uk.One can learn so much from our lovely thai ladies lol.

[rangers]

Kate,

One man/woman band's can not get legal here. I will not go into all the criteria required but to get a WP you must have a company set up in Thailand c/w paid up capital and for each expat employed four Thais have to be employed. The expat has to be paid a certain wage (this varies from country to country the expat comes from, UK is near the top of the pile) Just keep your head down so to speak. Good luck

[katyb]

Hi kate,have you got a few sponsors back in the uk.One can learn so much from our lovely thai ladies lol.

Now there's an idea........... however, I don't think it solves my work permit / tax problem!

[poshthai]

No but it will solve the need for work hehehehehhe.Sorry katie was only joking my friend.The issue that you stated will not apply here if you keep your ehad down and not speak to many people about it and just worry about how much tax you will pay in the UK.

[katyb]

90 days is an average over 3 or 4 years as far as I know.

As for the 180 days thing, read here from the Thai consulate in Hull:

http://www.thaiconsul-uk.com/pdfs/Gp%20%20...Information.pdf

But if you don't work in Thailand or at least can't get a work permit to do so, then how can you pay taxes? Catch 22.

You'll also see mention of the "income derived from sources outside of Thailand" which doesn't specify whether this has to be remitted to Thailand to be taxable there - which was admittedly only something I've seen banded about on this forum and elsewhere.

Good luck with Sunbelt.

Thanks for the link.

So we have -

"A resident is an individual who lives in Thailand for one or more periods totaling 180 days or more in any tax year."

and

"A non-resident individual is subject to tax only on Income earned from sources within Thailand."

So, if this iinformation is correct (ha ha!) it looks like my answer is as long you spend less than 180 days per tax year in LOS, you don't have to pay tax on income earned outside the country. Not sure how that leaves the work permit question. One would presume that it's not necessary, but I know one can never presume anything here!

[TCA]

So, if this iinformation is correct (ha ha!) it looks like my answer is as long you spend less than 180 days per tax year in LOS, you don't have to pay tax on income earned outside the country. Not sure how that leaves the work permit question. One would presume that it's not necessary, but I know one can never presume anything here!

Yeah, but is it earned out of the country if you're "working" here? Regardless of how long you stay, you can't work without a permit anyway, so you can't possibly be working here! So that answers that....

There is a double taxation treaty between Thailand and the UK which might be relevant given you're paying UK tax anyway, but if possible, why not have your income paid outside the UK and take advantage of a lower tax regime elsewhere? That last bit is a bit open ended but it's what I'm looking into right now re non UK residency.

Edited July 9, 2008 by TCA

[seancbk]

Hi Kate,

I'm in a similar position to you, although in Hong Kong not Thailand. I'm about to move to Bangkok however and did some research on Thai taxation etc.

This is what I found

" Taxpayers are classified into "resident" and "non-resident". "Resident" means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand on a cash basis, regardless where the money is paid, as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand. "

It appears that you are fine, as your income is not from sources in Thailand. You may however be liable for tax on the money you bring in.

You are flying under the radar (which I have done for many years) and you may never have a problem, but I would still get some proper advice just to be safe and to see what the implications are *if* you get caught.

Sean

[phuketrichard]

i am in the same position. I hold a 1 year retirement visa in Thailand BUT now have chosen to move here to Cambodia.

no problem where u work or how much u make

NO tax

a 1 year visa is $265 mulitple entry, no money in bank

easy life and costs are a little lower than thailand.

Only trouble i have seen so far is the food is not as good :-)

[KohKarrang]

Somebody mentioned earlier that there was no proof of actual physical work going on but that's not enough, if you do some of your work on the internet then that is considered secretarial work apparently, if you were being checked out by somebody from immigration they can probably get very easy access to you pc and check if you have been doing work on it...

[astral]

But if you don't work in Thailand or at least can't get a work permit to do so, then how can you pay taxes? Catch 22.

1. Don't believe all you read on the Thai consulate web sites.

2. Anyone can go to the local tax office and ask for a Thai tax id card, and then file tax returns.

As stated presence in Thailand for more than 180 days in a calendar year means you are liable to pay tax.

3. Income already taxed in the UK does not need to be taxed again in Thailand.

There is a dual tax treaty in place. HMSO can provide you with a copy.

Just have a copy of your UK tax return ready to show the Thais.

On the work side, keep you head down and tell anyone who asks "I am just tinkering on my computer".

You do need a visa to stay in Thailand.

I hope you have worked out how to manage that??

[Paul MBMG]

Afternoon,

I’ve had a look for the answer to this on TV and can’t thing anything, but I’ve got a feeling it might concern a few of us……… so I would like to ask, does anyone know what is the legal position regarding work permits for those of us who stay here long term but work remotely, servicing businesses in Europe.

I run a UK based internet business. My clients are mainly UK, some European and USA, but none are Thai. So, although I am physically working here on a PC, none of my business or income is actually coming from Thailand. I don’t have a Thai bank account so all funds are held within UK. I have a Non O from UK and no work permit. I go back twice a year for 4 – 6 weeks each time, renew visa and come back

The more time I spend here, the more people are starting to ask me how I can afford to keep coming back and staying so long, as I am a long way off retiring. Maybe they think I have a trust fund!? But in reality, I just work here as I do in UK and I just can't help feeling uncomfortable sometimes as I really do not know the answer.

So, please does anybody know – what is the law regarding this? If this is illegal is there anything I can do about it or do I just keep my head down? I’d rather be straight about it.

Many thanks in advance.

Kate

Impossible to answer on a forum, you do need a proper consultation with regard to Thai tax law and UK tax law and Thai immigration law. There are special provisions relating to taxation of internet revenues and there is a Double Tax Agreement between the UK and Thailand as well - which basically means that there are more complexities here (hence the need for a professional consultation) but there are also more opportunities too.

[thaibkk]

if your customers from usa / europe get their bill from your UK company, you already pay taxes in UK

why would you need or want to

- start a business here (2 million baht stuck for nothing)

- get 4 employees who does nothing but need to get paid for some stupid reason

- pay taxes here while you get NONE of the advantages thai people do

as I see: you need to do nothing at all, you already pay enough taxes in your home country

you do not take work from Thais in thailand, you do not work in thailand or get paid in a thai bank account

and you definetly do not need a to go to a legal company to suck you some money for nothing

it is like people who go to such agency for a demand of non-o ... while you can do all by yourself for the legal 1900 baht fee ...

[RAZZELL]

I think we have had this question asked before...

A member, "GirlX", was adamant that she didn't need a WP and was going to post a "letter" from immigration to prove it....about a year later we're still waiting to see it

Basically, if you were sitting at home or in an office in London, you'd be working.

If you were sitting at home or in an office in Paris or New York you'd be working.

But somehow, when you're sitting in a house in Thailand it no longer becomes work...but is "remote work" and the laws of the land are no longer relevant.

The simple, legal answer is you are working and you need a work permit and pay tax.

All this will help you to remain in Thailand long term. PR applications need tax records etc.

The other way, which could see you booted out (unlikely) is to stay under the radar.

It is, as ever, "up to you"

RAZZ

P.S The TV member's who will post, "you don't need to do this, you don't need to that" are usually the one's who start posting about "how my visa was refused".

Edited July 13, 2008 by RAZZELL

[Paul MBMG]

I think we have had this question asked before...

A member, "GirlX", was adamant that she didn't need a WP and was going to post a "letter" from immigration to prove it....about a year later we're still waiting to see it

Basically, if you were sitting at home or in an office in London, you'd be working.

If you were sitting at home or in an office in Paris or New York you'd be working.

But somehow, when you're sitting in a house in Thailand it no longer becomes work...but is "remote work" and the laws of the land are no longer relevant.

The simple, legal answer is you are working and you need a work permit and pay tax.

All this will help you to remain in Thailand long term. PR applications need tax records etc.

The other way, which could see you booted out (unlikely) is to stay under the radar.

It is, as ever, "up to you"

RAZZ

P.S The TV member's who will post, "you don't need to do this, you don't need to that" are usually the one's who start posting about "how my visa was refused".

Razz,

There are some exceptions in terms of taxation etc for internet businesses.

You're right about the simple legal answer but in this case there are also potentially some more complex legal answers too!

Paul

[monkfish]

Hi Kate,

I am in exactly the same situation, living here and working remotely for customers based outside Thailand.

I did check out the legal side and can tell you it is 100% Illegal (even if you only work 1 day per year) no question about it and with very dire consequences should you get caught, these including deportation, fine I think up to 200 000B and even Prison. I don't think they would send you to prison but deportation would be certain. Myself, this did bother me and to boot my neighbors were asking to many questions, so I decided to go legal, the only way possible is to set up a company. This costs about 60 000B including work permit and everything , the tax issue will sort itself out as you will have to pay about 7% Tax on a minimum of 50 000B per month. The cost of running the company is about 13 000B per month including accounting and social benefits for 4 employees you don't really employ.

Anyway running a company here will probably be cheaper than paying tax in the UK.

If you do decide to continue working Illegally then please don't tell anybody especially the neighbors, they are your biggest danger, they will be jealous and snitch on you! Believe me. Remember to Bolt the doors and send all Emails encrypted, Email will probably be the first place they look for evidence before a search warrant is issued.

Good Luck!

[chrisartist]

The previous posters are perfectly correct in determining that you are working illegally in Thailand. However, how the authorities might view this situation is far from a simple matter to determine. This is because according to Thai law, one is deemed to be working if one exerts effort and uses knowledge, regardless of whether or not one receives financial or other benefit.

This definition entails that every single alien in Thailand who does not have a work permit is working illegally. This is because the definition entails that performing such activites as cleaning one’s teeth, going for a walk, riding a bicycle, or reading a book constitute working. Performing such activities requires that one exert effort and that one use knowledge. (Even walking and cleaning your teeth require that you use knowledge; you need to know that using some cleansing substance is appropriate and that you have to put the cleansing substance on a suitable tool for applying it to the teeth, and so on.)

So, basically, if the authorities don’t like what you are doing, for whatever reason, you are screwed, because they will always be able to cite some law that you are breaking.

However, obviously, this law is not applied literally, as is shown by the fact that there are plenty of aliens wandering around Thailand who fall foul of the Thai definition of work and who have not had charges brought against them.

It seems clear that the law is not meant to be applied literally (though it is meant to be possible to apply it if an alien does something that the authorities don’t like.) The trick is to try to determine how the authorities would view your situation. To do that, we need to determine the spirit in which the law is meant. We can start by considering the conditions under which someone is eligible for a work permit for employment. One is only eligible for a work permit if one is deemed to be doing a job that a Thai person could not do. Given that this is the case, we can conclude that part of the purpose of the Thai definition of work is to prevent aliens from taking jobs from Thais. We can go further by considering that part of the definition of work that states that it does not matter whether or not you receive remuneration or some other benefit when you perform an activity that requires the exertion of effort and the use of knowledge. This makes sense if you consider an example of helping your neighbour out by planting some rice. By helping your neighbour in this way, even though you do not get paid, you might be depriving a Thai person of earning a few baht for his daily somtam that he could earn by planting the rice that you planted.

On the basis of the above, we may conclude that the spirit in which the Thai definition of work is meant to be applied is that it is designed to prevent aliens from depriving Thai nationals of money that they could be earning if you were not doing the particular work that you are doing.

In your case, you are not so depriving any Thai national. You are doing a job that no Thai national could do and so you are not doing anything that a Thai national could get paid for if he were doing it. Hence, even though you are, strictly speaking, working, it would be unreasonable of the authorities to take action against you. However, whether or not the authorities would take this view in any particular case is unknown. Given that it is unknown how the authorities would react in any given case, it would not be worthwhile taking legal advice, because the lawyers will not know how the authorities will react in any particular case, either (though they may be able to offer you some informed speculation if they are aware of precedents.)

The fact that how your situation will be viewed is a matter of how it is perceived by particular authorities on a particular day, means that you are on dangerous ground. It is a 100% certainty that you are working illegally, but that may or may not be a problem, depending on how the authorities decide to interpret the spirit of the law on any particular occasion. It is not possible to be more precise than this. However, when in Thailand, it is always a good idea to keep as many people as possible in the dark about what you are doing to the greatest extent possible.

[Trevor]

Kate, what are you telling the Thai consulate in the UK -- Hull seems to be the easiest -- that you are doing in Thailand?

Any problems on your 90-day visa runs over tax clearance by being there cumulatively for 180 days in a 365-day period? My guess is most immigration officials won't make work for themselves, and therefore just stamp you out regardless ... but it's a risk.

Other options :

Call the neighbours' bluff by studying Thai or doing some voluntary work.

Move to Cambodia.

Check out how your status is treated in any other South-East Asian countries which appeal.

P.S. Thanks for asking such a great question.

Edited July 13, 2008 by Trevor

[Acky]

What's about living in LOS and trading stocks in a account in europe. No thaibank account, no income in LOS. Will this also be treated as "working" and requires a work permit?

Thanx

[Jimjim]

This question has been on here a few times before. As for the 4 employees thing, Sunbelt recently said that in Bangkok this is not necessary at the moment, but outside Bangkok it is. Not a question of law just a question of practice and current policies.

As for working illegally/legally. Yes, it's illegal technically according to the wording of the law to be in your apartment on the computer working in Thailand but getting all money from overseas. Illegal because you need a work permit and illegal because I think foreigners are not allowed to work from home but officially have to have a separate working place from their home.

However, all the times I've seen this in the past those that have actually tried to go down to the labour office and ask about it have either been given confused stares from many different staff, even those in high positions, or laughed out of the place and told not to worry about it. I believe one was told by an officer that technically it was illegal but they had no policy for such people and that they would not be in danger from their office or the police. Basically, they were told not to worry about it as it wasn't a concern. Just don't ruffle any feathers and you'll be fine was the message.

Of course the risk is up to you, but can anyone cite any case of anyone being arrested for this? I highly doubt it. The numbers doing this are not enough for the authorities to worry about, frankly. And they don't see it as being "that bad" so they don't worry about it. Only thing I could think of is if someone had a vendetta against someone doing this and called the authorities. Even if that, they would have to make several calls to the authorities before they'd bother to try and arrest the illegal worker and possibly give some tea money to make it happen.

[cmdrj0]

interesting but bordering on paranoia...any documented cases of this scenario?

[wasabi]

Some are adamant that it's illegal and that no proof towards it's legality has ever been demonstrated but can anyone point us to a website or document where immigration specifically states telecommuting for a company outside Thailand is illegal?

I personally contacted SunBelt and Siam Legal who both said it is legal.

[davejonesbkk]

Isn't is about time there was a sticky thread or something about this as it seems to pop up around once a month or so...

Some interesting posts, some right answers, some wrong and some halfway in between in a grey area, which is kinda like most things in Thailand.

I think Jims answer was the closest to reality though. If you walked into the Labour office and told them about your status they would wave you away (especially if it was just before lunch time ) as they have much, much more important things to do. Also has anyone actually though about how they would catch you even if they wanted to? What are they going to do? To catch someone at this would be practically impossible, heck if they could get access to your computer the English language skills of most cops/gov officials are pretty low so they would have a hard time going through your files....

Edited July 14, 2008 by davejonesbkk

[katyb]

I personally contacted SunBelt and Siam Legal who both said it is legal.

Now that's very interesting..... I did get legal advice ( from one of these two companies) and the answer I got was the opposite! ILLEGAL. But unlikely to be discovered or proven.

So officially, I would need a work permit and thus would need to set up a company here in order to get one.

Thanks for all of your replies and comments.

Kate

[britmaveric]

No way to prove what you are doing, however its illegal. I think best bet keep a low profile and go about your business and avoid the questions.