ArtVandelay Posted September 25, 2008 Share Posted September 25, 2008 I'd like to teach in Thailand (been there twice, really like it) but am still unclear on how the tax situation works. 1) Do the Thai schools take out taxes from farang teachers paychecks? and 2) What happens when I return home (to US in my case)..? Do I need to tell my embassy I am teaching abroad before I leave? What happens if I wait until I get back? Will I have trouble getting back in my country (with a wp in my passport)? Any advice is appreciated. Thanks in advance. Art Link to comment Share on other sites More sharing options...
lanny Posted September 25, 2008 Share Posted September 25, 2008 I'd like to teach in Thailand (been there twice, really like it) but am still unclear on how the tax situation works. 1) Do the Thai schools take out taxes from farang teachers paychecks? and 2) What happens when I return home (to US in my case)..? Do I need to tell my embassy I am teaching abroad before I leave? What happens if I wait until I get back? Will I have trouble getting back in my country (with a wp in my passport)? Any advice is appreciated. Thanks in advance. Art You may qualify for an exemption from Thai taxes for the first two years of teaching in Thailand. Your school should be able to help you with the necessary paperwork. Even though you will be working in Thailand, you still need to file a US tax return. You may be able to claim an exclusion here, too, but you need to file a return to claim it. Otherwise, the rules for paying US taxes are no different than for someone living in the states. Link to comment Share on other sites More sharing options...
Ijustwannateach Posted September 25, 2008 Share Posted September 25, 2008 Yup- after a couple of years of constantly living abroad, you can acquire a new tax status which gives you an extra exemption (up to about USD70,000), but you have to file for it- and even if you owe no taxes you are supposed to file, otherwise I suppose you are subject to some kind of bureaucratic penalties for not filing (but that's better than a penalty for not *paying*). "S" Link to comment Share on other sites More sharing options...
PeaceBlondie Posted September 25, 2008 Share Posted September 25, 2008 A little bit more on the details You do not need to tell the embassy. As a US citizen, you are subject to income tax assessments by the IRS, world-wide. If you file for it, you receive a foreign earned income exclusion, on more than $70,000 USD every year. In my case, I qualified immediately, under the residence test, rather than the physical presence test. If you teach in a Thai govt. school, you are also exempt for the first two years (but yuu need to claim the exclusion to get it). You are also subject to Thai income tax. Link to comment Share on other sites More sharing options...
lanny Posted September 25, 2008 Share Posted September 25, 2008 A little bit more on the detailsYou do not need to tell the embassy. As a US citizen, you are subject to income tax assessments by the IRS, world-wide. If you file for it, you receive a foreign earned income exclusion, on more than $70,000 USD every year. In my case, I qualified immediately, under the residence test, rather than the physical presence test. If you teach in a Thai govt. school, you are also exempt for the first two years (but yuu need to claim the exclusion to get it). . You are also subject to Thai income tax. Peace Blondie The exemption for teachers is from Thai taxes. You do not need to teach in a government school; all teachers qualify. Your school should be able to help with the paperwork. File and the school doesn't need to withhold taxes. Link to comment Share on other sites More sharing options...
TerryLH Posted September 25, 2008 Share Posted September 25, 2008 "Yup- after a couple of years of constantly living abroad, you can acquire a new tax status which gives you an extra exemption..." Do you really believe it takes a couple of years to quaiify for the exemption? Link to comment Share on other sites More sharing options...
WilliamJarvis Posted September 27, 2008 Share Posted September 27, 2008 (edited) A little bit more on the detailsYou do not need to tell the embassy. As a US citizen, you are subject to income tax assessments by the IRS, world-wide. If you file for it, you receive a foreign earned income exclusion, on more than $70,000 USD every year. In my case, I qualified immediately, under the residence test, rather than the physical presence test. If you teach in a Thai govt. school, you are also exempt for the first two years (but yuu need to claim the exclusion to get it). . You are also subject to Thai income tax. Peace Blondie The exemption for teachers is from Thai taxes. You do not need to teach in a government school; all teachers qualify. Your school should be able to help with the paperwork. File and the school doesn't need to withhold taxes. As far as I was aware, this applied in the case of UK teachers under the Double Tax Treaty between Thailand and the UK. I was not aware it also applied in the case of the USA. PB - Is that right? Edited September 27, 2008 by WilliamJarvis Link to comment Share on other sites More sharing options...
PeaceBlondie Posted September 27, 2008 Share Posted September 27, 2008 I defer to Lanny. I used the Thai-US treaty as well as the Earned Income Exclusion, and did not know I was exempt from Thai income tax as well. Mai bpen rai - in my case, the first Thai incompetent govt. school withheld Thai taxes even though I had no Thai tax ID number. I bet the Director's staff had a PeaceBlondie som tam party after I left, using my withholdings. Link to comment Share on other sites More sharing options...
ArtVandelay Posted September 29, 2008 Author Share Posted September 29, 2008 Thanks for all the advice. Best site on the internet for Thai teaching info. Link to comment Share on other sites More sharing options...
PeaceBlondie Posted September 29, 2008 Share Posted September 29, 2008 Thanks for all the advice. Best site on the internet for Thai teaching info. QUOTE OF THE DAY Link to comment Share on other sites More sharing options...
dr_Pat_Pong Posted September 30, 2008 Share Posted September 30, 2008 self praise and all that PB Link to comment Share on other sites More sharing options...
paulfr Posted October 2, 2008 Share Posted October 2, 2008 (edited) If you are a US citizen, you can claim an $80,000 exemption on foreign income when you file your return. Since pay is so low here [25-75Kbaht ~ $800 - 2500 /month] you will likely owe no US tax unless you have other income like pensions or a stock portfolio. I do not think you have to apply if you pass one of the residency or physical presence tests. Be warned that teaching here is challenging because you are working for Thais and they treat employees poorly; all employees Thai and farang. It is Asian culture. Try it for a year and see. You may have the personality to adjust well. But not all do. Good luck Edited October 2, 2008 by paulfr Link to comment Share on other sites More sharing options...
lanny Posted October 3, 2008 Share Posted October 3, 2008 If you are a US citizen, you can claim an $80,000 exemption on foreign income when you file your return. Since pay is so low here [25-75Kbaht ~ $800 - 2500 /month] you will likely owe no US tax unless you have other income like pensions or a stock portfolio. I do not think you have to apply if you pass one of the residency or physical presence tests. Not true! You are entitled to $82,400 (in 2007) exclusion for earned income but you must file a tax return to claim this. If you don't and IRS contacts you about your return, you may be denied the election to exclude this income. And remember, the statue of limitations for IRS to come after you doesn't start running until you do file! Link to comment Share on other sites More sharing options...
PeaceBlondie Posted October 4, 2008 Share Posted October 4, 2008 Thanks again to lanny. I overlooked that mistake. You must file and request the exemption. Link to comment Share on other sites More sharing options...
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