Tax Options Living In Thailand

[DDuval]

HI All

I have recently left the UK to come and work in Thailand. My question is as follows if I'm paid in the UK by a UK company and register as a non UK Tax Payer what taxes do I pay in Thailand and most of all whats deductible. Example Childcare costs, School costs, Medical Costs ?

Any advice would be helpful because ive looked at HMRC and it isn't very clear for me to continue the job in Thailand or go back to the UK because living in Thailand thus far with a western Family is very expensive

cheers

[Briggsy]

First question: Do you have a work permit in Thailand? If not, I don't see how you would be paying income tax.

[Soutpeel]

You are going to have h*ll of time convincing HMRC that you are non-resident in the UK for tax purposes if you are being paid in the UK by a UK company, and in fact you should be paying tax at source in the UK... so there is your first problem, before dealing with any Thai tax issues

[Monokuro]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Edited December 4, 2012 by Monokuro

[DDuval]

You are going to have h*ll of time convincing HMRC that you are non-resident in the UK for tax purposes if you are being paid in the UK by a UK company, and in fact you should be paying tax at source in the UK... so there is your first problem, before dealing with any Thai tax issues

Appreciate you quick answer. Already sorted. Been give a 3 year rebate yesterday now working on National insurance

[LongTimeLurker]

You are going to have h*ll of time convincing HMRC that you are non-resident in the UK for tax purposes if you are being paid in the UK by a UK company, and in fact you should be paying tax at source in the UK... so there is your first problem, before dealing with any Thai tax issues

That's not a problem, the UK company just has to inform HMRC that he's working overseas and they can pay him goss without income tax deductions although they may still have to deduct NI contributions for the first year.

[DDuval]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Excellent. First job tomorrow.

[Soutpeel]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Under the tax rules, the OP is liable for UK tax:

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

[DDuval]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Under the tax rules, the OP is liable for UK tax:

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

I know, I filled in the forms and told HMRC that I work in Singapore, Hong Kong, Australia and now Thailand all remotely on an Ad Hoc basis for a UK Company. HMRC have now classed me as non UK resident. This is where i'm up to...what next ?

[Soutpeel]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Under the tax rules, the OP is liable for UK tax:

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

I know, I filled in the forms and told HMRC that I work in Singapore, Hong Kong, Australia and now Thailand all remotely on an Ad Hoc basis for a UK Company. HMRC have now classed me as non UK resident. This is where i'm up to...what next ?

Well if you dont have a Thai WP how can you pay income tax in Thailand and if your working remotely without one, you are working illegally in Thailand BTW

[Soutpeel]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Under the tax rules, the OP is liable for UK tax:

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

I know, I filled in the forms and told HMRC that I work in Singapore, Hong Kong, Australia and now Thailand all remotely on an Ad Hoc basis for a UK Company. HMRC have now classed me as non UK resident. This is where i'm up to...what next ?

How long have you been out the UK ?

[DDuval]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

Under the tax rules, the OP is liable for UK tax:

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

I know, I filled in the forms and told HMRC that I work in Singapore, Hong Kong, Australia and now Thailand all remotely on an Ad Hoc basis for a UK Company. HMRC have now classed me as non UK resident. This is where i'm up to...what next ?

How long have you been out the UK ?

Been out of the UK 4 years and have arrived in Thailand on holiday one month ago. Currently weighing up my options. Not to happy with the costs of schools Fees for my Western daughter nor the Medical Fees.

I need advising on the following

What's the rate of income Taxes in Thailand?

What are deductible from income tax? School Fees, Medical Fees, car costs Etc

Please note, I want to understand how i will financially benefit from coming to Thailand before I commit to staying here.

thx in advance

[inthepink]

Soutpeel is almost certainly wrong with respect to your tax liability in the UK, you are unlikely to be liable for income tax there but he is right that you will be working here illegally (judging from what you have said on this thread anyway).

Even assuming that you could obtain a work permit and work here legally, it is not possible for anybody on here to say how or whether you will benefit financially from moving here - we don;t know where you live now and what taxes you are currently paying.

Edited December 4, 2012 by inthepink

[Soutpeel]

Soutpeel is wrong with respect to your tax liability in UK, you are almost certainly not liable for income tax there but he is right that you will be working here illegally (judging from what you have said on this thread anyway).

Even assuming that you could obtain a work permit and work here legally, it is not possible for anybody on here to say how or whether you will benefit financially from moving here - we don;t know where you live now and what taxes you pay.

Soutpeel was just quoting something I read, as he states he working through a UK company and being paid by them...

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

[DDuval]

Soutpeel is wrong with respect to your tax liability in UK, you are almost certainly not liable for income tax there but he is right that you will be working here illegally (judging from what you have said on this thread anyway).

Agree with your comments about WP, this is the first thing I will do when or If I commit to work in Thailand. Currently on long term holiday in Thailand

[Soutpeel]

Been out of the UK 4 years and have arrived in Thailand on holiday one month ago. Currently weighing up my options. Not to happy with the costs of schools Fees for my Western daughter nor the Medical Fees.

I need advising on the following

What's the rate of income Taxes in Thailand?

What are deductible from income tax? School Fees, Medical Fees, car costs Etc

Please note, I want to understand how i will financially benefit from coming to Thailand before I commit to staying here.

thx in advance

You dont state your income so no one can tell you what your tax would be, its similar to the UK on a sliding scale

Under Thailand tax rules....dont believe School fees, car costs are deductable and pretty sure medical isnt either, I certainly dont get any deductable on these items

[DDuval]

Guys lots of good advice there. Will weigh up my options over the next 4 weeks and decide if the LOS is for me and My family. Appreciate all your input.

[Soutpeel]

Soutpeel is wrong with respect to your tax liability in UK, you are almost certainly not liable for income tax there but he is right that you will be working here illegally (judging from what you have said on this thread anyway).

Agree with your comments about WP, this is the first thing I will do when or If I commit to work in Thailand. Currently on long term holiday in Thailand

But in your OP you said "I have recently left the UK to come and work in Thailand" now you saying your on holiday and you left the UK 4 years ago and you went to say in another post "Excellent. First job tomorrow".....I am confused....if your doing your first job tomorrow and your on holiday in Thailand then you will be working illegally tomorrow... ....further "it isn't very clear for me to continue the job in Thailand or go back to the UK because living in Thailand thus far with a western Family is very expensive"....So I am still very confused

Edited December 4, 2012 by Soutpeel

[anon210]

If you are a tax resident of Thailand, you would be subject to a progressive tax rate which varies from 10 % to 37 % for the highest bracket (above 4 million THB). http://www.rd.go.th/publish/6045.0.html

See below for the deductibles:

TAXABLE INCOME = Assessable Income - deductions - allowances

Deductible expenses allowed depend on the category of assessable income as follows: Category of Income Deduction Expenses I I a. Income from employment

(Category (1) and (2)) and income

from copyright (Category (3)) b. Income received from copyright

(Category (3)) and income from

dividends and interests (Category 4) c. Income from rental of property

d. Income from breach of hire-

purchase contracts or installment

sales contractsIncome from

liberal professions e. Income from liberal professions

f. Income derived from contract of

work whereby the contractor

provides essential materials

besides tools g. Income derived from business,

commerce, agriculture, industry,

transport, or any other income not

specified in a. to f. 40% of income but not

exceeding 60,000 baht

No deductions are allowed.

Actual and reasonable

expenses, or a lump sum

deduction of 10% to 30%

depending on the type

of rented property A lump sum deduction of

20%

Actual and reasonable expenses, or a lump sum deduction of 30% (except for the medical profession whereby 60% is allowed) Actual and reasonable expenses, or a lump sum expense of 70%

Actual and reasonable expenses, or 65% - 85% depending on the types of income <a name="table6" style="font-size: 13px;">

Allowances (Exemptions) allowed for the calculation of PIT Types of Allowances Amount

Taxpayer (and a partner of non-juristic partnership of body of persons)

Spouse

Child allowance (child under 25 years of age and studying at educational institution, or a minor, or an adjusted incompetent or quasi-incompetent person)

30,000 baht for the taxpayer

30,000 baht

15,000 baht for each (limited to three children)l

Additional education allowance (additional allowance for child studying in educational institution in Thailand)

Parents allowance

Life insurance premium

Contributions to approved Provident Fund or Retirement Mutual Fund (RMF)

Contribution to Long Term Equity Fund (LTF)

2,000 baht each child

30,000 baht for each of taxpayer’s and spouse’s parents if such parent is above 60 years old and earns less than 30,000 baht

Amount actually paid by taxpayer or spouse on the taxpayer's own life but not exceeding 100,000 baht each

Amount actually paid by taxpayer or spouse at the rate not more than 15% of wage, but not exceeding 500,000 baht

Amount actually paid up to 15% of wage, but not exceeding 500,000 baht in a tax year, provided that the invested unit is held for at least 5 years, except in the case of incapacity or death during the investment period

Home mortgage interest

Social insurance contributions

Charitable contributions Amount actually paid for the purpose of purchase or construction of a residential building in Thailand but not exceeding 100,000 baht

Amount actually paidby taxpayer or spouse

Amount actually donated

but not exceeding 10% of assessable income after all standard deductions and allowances

And for tax residence in the UK, cfr. the Dual Tax Treaty between UK and Thailand, article 4:

(2) Where by reason of the provisions of paragraph (1) of this Article an individual is a resident of both Contracting States, then his status shall be determined in accordance with the following rules:

(a) he shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him. If he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer (centre of vital interests);

(

if the Contracting State in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode;

© if he has an habitual abode in both Contracting States or in neither of them he shall be deemed to be a resident of the Contracting State of which he is a national;

(d) if he is a national of both Contracting States or of neither of them, the competent authorities of the Contracting States shall endeavour to settle the question by mutual agreement.

http://www.hmrc.gov.uk/manuals/dtmanual/DT18703.htm

[LongTimeLurker]

Soutpeel is wrong with respect to your tax liability in UK, you are almost certainly not liable for income tax there but he is right that you will be working here illegally (judging from what you have said on this thread anyway).

Even assuming that you could obtain a work permit and work here legally, it is not possible for anybody on here to say how or whether you will benefit financially from moving here - we don;t know where you live now and what taxes you pay.

Soutpeel was just quoting something I read, as he states he working through a UK company and being paid by them...

Non-residents (as opposed to domiciled non-residents, who are now subject to slightly different rules) are generally speaking only liable to UK income tax on income derived from:

• Property situated in the UK
  
• Any trade or profession carried on through a branch or agency in the UK
  
• Any employment the duties of which are performed in the UK
  

In my case:

recruited by a UK company in UK to specifically work on an overseas project.

Money paid in GBP in a UK bank.

No tax to pay as the company declared in advance to HMRC that I (and 20 others) was going overseas and that no work would be performed in UK. Never set foot in the UK office after the initial interview.

For Thai Tax http://www.rd.go.th/...ish/6045.0.html

Thai_Personal_income_tax_Calculator_v2(2).xls

[LongTimeLurker]

Soutpeel is wrong with respect to your tax liability in UK, you are almost certainly not liable for income tax there but he is right that you will be working here illegally (judging from what you have said on this thread anyway).

Agree with your comments about WP, this is the first thing I will do when or If I commit to work in Thailand. Currently on long term holiday in Thailand

But in your OP you said "I have recently left the UK to come and work in Thailand" now you saying your on holiday and you left the UK 4 years ago and you went to say in another post "Excellent. First job tomorrow".....I am confused....if your doing your first job tomorrow and your on holiday in Thailand then you will be working illegally tomorrow... ....further "it isn't very clear for me to continue the job in Thailand or go back to the UK because living in Thailand thus far with a western Family is very expensive"....So I am still very confused

He was referring to Monokuro's post advising him to open up a bank account offshore in IoM and responding "Excellent. First job tomorrow" as in, he will take action.

Edited December 5, 2012 by LongTimeLurker

[personchester]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

When permanently abroad and no longer resident in the UK any payments received in the UK i.e. wages, dividends, bank interests, pensions, rental income etc.. are taxable, then after the personal allowance is deducted the required tax will then be demanded and has to be paid, but any payments received abroad are not taxable in the UK when no longer resident in the UK.

Expats should invest their savings offshore in order to avoid "dividends & bank interests" taxation.

Taxation in Thailand depends on your work activity.

[Soutpeel]

You also have to be out the UK for a whole tax year to become tax exempt. I don't know if Thailand has a double tax treaty, so you might need to pay both.

Saying that though - if you are working online/remotely - I doubt the Thai tax office would ever find out about it.

Edit:

Also - what I would do if I was you, is setup an offshore bank account on the Isle of Man - but register it totally with your Thai details. Isle of Man accounts still accept BACS payments, so UK companies can still pay you easily - but it's not going to be registered to your UK persona.

When permanently abroad and no longer resident in the UK any payments received in the UK i.e. wages, dividends, bank interests, pensions, rental income etc.. are taxable, then after the personal allowance is deducted the required tax will then be demanded and has to be paid, but any payments received abroad are not taxable in the UK when no longer resident in the UK.

Expats should invest their savings offshore in order to avoid "dividends & bank interests" taxation.

Taxation in Thailand depends on your work activity.

This has always been my understanding as well....in the OP's case...working for a UK company, being paid in the UK, but not living in the UK...puts him under the UK tax man ?