Us Retiree Tax Obligation In Thailand

[Tiger7Moth]

I have read several posts on related subjects but still am uncertain about certain aspects of my personal situation. So, I am hoping someone can refer me to a tax accountant in BKK.

Just for some background: I am receiving a pension and am under the impression that pension is not taxable by Thailand as it is already taxed in US and there is an agreement between Thailand and US.; I have just made a 401K withdrawal (a bit over 3 million baht, which I am mentioning because I am concerned it might raise some flag due to the amount if and when I deposit in my savings account in BKK- the amount received consists of my pre-tax contributions (ending 21 months ago), contributions by my employer (also ending 21 months ago), capital gains and reinvested dividends. I am not sure if any of these might be subject to Thai tax.

I have another 401K from which I can make a distribution in 1 year (as I will then be 59 1/2 years old). This one consists entirely of employee contributions (ending 12 years ago and capital gains and reinvested dividends). I have similar concerns here as for the 401K distribution (100 percent) I recently made.

Any help getting professional advise would be appreciated.

[lopburi3]

Thailand is only interested on current income for tax purposes (and there is also a tax treaty) so you should not have any problem. PWC is probably the number one accounting type firm here if you must have professional advice but believe they are set up for business rather than personal accounts.

[Ajarn]

You might want to PM PeaceBlondie about this. I think he has some expertise in this area, especially in regard to Amercans.

[Tiger7Moth]

Thailand is only interested on current income for tax purposes (and there is also a tax treaty) so you should not have any problem.  PWC is probably the number one accounting type firm here if you must have professional advice but believe they are set up for business rather than personal accounts.

<{POST_SNAPBACK}>

I will check my old e-mails. I believe I corresponded with PWC before I came to Thailand.

My biggest frustration is that governments are not at all ethical. So, they seem to interpret things any way they chose. In the case of 401K withdrawal, I am not sure, but, if my pre-tax contributions (which were earnings a long time ago, years ago) are taxed as income and I bring these funds into Thailand, it seems feasible (although not ethical) that Thailand might consider this to be income within the last year or two. Whereas, the funds came from income from work done years ago ( but, with taxes deferred as per US tax regulations). So, I could (but, I hope not) end up paying tax to Thailand for work done in US 10 years ago (which would be ridiculous, but, still could happen).

[chownah]

I'm interested in this too. On another thread it was mentioned but the answer not presented.

If I work in another country half the year and then come here for half the year and spend the money it is not taxed.....it was not made in Thailand...it was made in another country. There is no tax on importing money that I have ever heard of.

So, likewise I guess, if I have investments or sources of income for which I do not have to work and these are located in another country and I come here for part of the year and spend money it is likewise not generated in Thailand and not taxed here and again there is not a tax for bringing money into Thailand.

This is more or less my arguement. I could be wrong without a doubt. I bring money into Thailand from time to time by wire from my bank outside to my bank inside. Noone has ever indicated that bringing money into the country is taxed.

Edited May 20, 2005 by chownah

[Valjean]

I found this web site helpful http://www.protaxconsulting.com/ and in fact called up and talked to Marc one of the principles. Very helpful and knowledgeable. I am not an expert in this but I wonder if you need a good US accountant that understand US tax law because that's the tax return you're going to need to file. In my case Marc contacted someone in Thailand to get some info he didn't have. Understandable that he needs local people to advise. Moving to Thailand and will have Marc do my taxes come April.

Check out the article "Are You A US Person Thinking Of Accepting A Foreign Assignment? Some US Tax Matters You Should Know Before You Accept!"

http://www.protaxconsulting.com/html/articles.html

Good luck,

[PeaceBlondie]

Replying to the original poster: it sounds, from what you've written, that all your 401(k) withdrawals are ordinary income on your US Form 1040. I know nothing about Thai income tax, but can't see how they would have any claim on that money.

I believe that it's wise to keep documents showing what money you bring into Thailand from abroad, so that you can show it wasn't earned here.

I receive several pensions from the US government (I was an IRS tax auditor) and they're not taxable in Thailand so far as I know.

I hope that helps. Feel free to send me a PM if you have further questions.

[ProThaiExpat]

In solving problems regarding government regulations, one should move from the general principle to the specific issue.

The general priciple of tax law is that the state, province or country in which the income is earned, has the primary taxing authority. Applying this principle to all your tax questions up front, eliminates a lot of the projections or "what ifs" we all engage in.

Likewise, tax law enforcement requires criminal intent before it becomes a serious problem. Thus a reasonable belief based on established tax policy is a defense to such a charge.

The only real close question on income tax in Thailand is whether you are actually physically located in Thailand when the activity you engage in generates income. Those of us who earn income while on the internet and pay no tax to any country, while physcally located in Thailand are the ones the Thai government will go after first, although none have reported them doing it yet.

Efficacy is always an issue in tax collection. How much would the Thai government expend to collect income tax from falang earning money on the internet without paying tax in another country?

Our desire for certainty often drives us to seek a "black and white" answer to a legal question, when most legal questions and answers are found in the "gray area".

Following the general principle mentioned previously, don't worry about paying the Thai government any tax unless you are legally employed in Thailand.

Edited May 21, 2005 by ProThaiExpat