Retirement Visa And Taxes

[djinn]

As I had a lot of useful infos onThaivisa in my quest for OA visa,I submit the following infos coming from a conversation with 2 expats having their industrial companies in Thailand.

1°When having a retirement visa (no imm OA),from January 1rst ,you will have to pay taxes in Thailand if you stay more than 183 days in the kingdom during 2004.Taxes to be payed on a theorical revenue of 65000 bahts/month .

2° The 800 000 bahts that have to be on a thai bank account cannot go back abroad (blocked??? Or spent here???)No precision given.

Have the administrators of the site some infos or comments on these assertions

Thanks in advance for your enlightments

djinn

[Roger13]

Dr Pat & George,

Any views on this post?

It sounds very logical?

AND - very worrying ...

Roger

[dr_Pat_Pong]

As I had a lot of useful infos onThaivisa in my quest for OA visa,I submit the following infos coming from a conversation with 2 expats having their industrial companies in Thailand.

1°When having a retirement visa (no imm OA),from January 1rst ,you will have to pay taxes in Thailand if you stay more than 183 days in the kingdom during 2004.Taxes to be payed on a theorical revenue of 65000 bahts/month .

2° The 800 000 bahts that have to be on a thai bank account cannot go back abroad (blocked??? Or spent here???)No precision given.

Have the administrators of the site some infos or comments on these assertions

Thanks in advance for your enlightments

djinn

You are supposed to live off that 800,000 baht, and have money to fall back on in case of emergencies. The funds are yours to deal with as you please, but being in funds a week before each application to extend may rile Immigration, and possibly prejudice your renewal. There has been no announcement about taxes from 01 January that I have heard.

[djinn]

Thanks for your answer Dr Pat.

For the 800 000 bahts your standpoint is logical.I disagree with the people who take back home all their money the next day they have their visa.

On the tax rumor,has Georges some comments????

[pitrevie]

My take on this is that any tax to be levied is only on income that is earned within the Kingdom. I am sure that my own government would be interested in any income that I received from any source but it isnt the policy to have double taxation. Therefore if you were being taxed on that income in Thailand your own tax authorities do not insist on double taxation. I think it only fair if you have a job or income in your host country that you pay tax on that income. I do not think they include your pension in this as that would be taxed at source

[wowpow]

I have had no problem exporting funds from Thailand to the UK though you have to state a reason such as 'personal expences'. I was charged 1% but maybe some banks have fixed charges and use SWIFT which charges me a fixed UK£20 to send any sum here. I heard that some were borrowing the 800,000 baht from friends to apply for retirement Visa so they changed it and require it come from abroad in overseas currency.

I have been advised that there is no tax liability for monies brought into the country whether tax has been paid in ones home county or not - many wise ones have offshore investments.

Tax is liable in income generated in Thailand, as one would expect.

[Dah fahrang]

....and with present interest rates on bank deposits being around 0.75%, that makes an 'income' of just 6000 baht on anassumed 800,000 baht deposit.

And that doesn't take into account tax relief, and sliding scale of tax rates based on income level. Probably work out at around B3000 for the year.

[dr_Pat_Pong]

Thanks for your answer Dr Pat.

For the 800 000 bahts your standpoint is logical.I disagree with the people who take back home all their money the next day they have their visa.

On the tax rumor,has Georges some comments???? <_<

George is away for a couple of days. Email him.

[Limbo]

This is very interesting! A foreigner living in Thailand pays already taxes, namely on -at least a part of- what he or she spends: the value added tax.

Most pensions are taxed in the 'home'-country and most of these countries have agreements with Thailand concerning the avoidance of double taxation.

Some private pensions are not taxed in the home country, because the pensioner is not longer resident there. It is not unreasonable that these pensions could be taxed in Thailand.

But what if you live of your savings? The non-crooks among you paid already

-probably several- taxes on these. If you not use your pension to live on but the money you saved earlier (the pension you receive now, you can add to your savings)?

At the moment it is not clear which position the Thai Government will take. Formally you have already to pay taxes (about 8%?) on income which is not taxed elsewhere.

I don't think the Thai Government wants to charge every retired foreigner here about 5000 Baht a month (8% of the required income). he system will be more sofisticated and more just.

Some indirect taxes for foreigners would certainly be justified. 5000 Baht is what you pay in road taxes in several European countries.

Have another 60 Baht beer!

[caughtintheact]

My take on this is that any tax to be levied is only on income that is earned within the Kingdom. I am sure that my own government would be interested in any income that I received from any source but it isnt the policy to have double taxation. Therefore if you were being taxed on that income in Thailand your own tax authorities do not insist on double taxation. I think it only fair if you have a job or income in your host country that you pay tax on that income. I do not think they include your pension in this as that would be taxed at source

1. If your home country does not have a tax treaty with Thailand, and you cannot prove that the money you bring here was taxed at source, then you could be liable for taxes.

2. Conversely, if your country has a tax treaty with Thailand, money brought in from abroad from a pension or savings that is taxed at source, will not be taxable here.

3. If you have income earned within the country, you cannot be on a retirement visa, because it does not permit you to work.

[lopburi3]

1. If your home country does not have a tax treaty with Thailand, and you cannot prove that the money you bring here was taxed at source, then you could be liable for taxes.

2. Conversely, if your country has a tax treaty with Thailand, money brought in from abroad from a pension or savings that is taxed at source, will not be taxable here.

3. If you have income earned within the country, you cannot be on a retirement visa, because it does not permit you to work.

1. The norm seems to be that current income coming in could be subject to tax but savings is not. But by law believe any money coming into Thailand could be taxed if not tax treaty exempted. But admit I am no expert.

2. Tax treaties set out very specific rules - they are not all the same. Read the fine print very closely.

3. You could well have tax required for money earned inside Thailand without working. Think about bank accounts for example.

[Thetyim]

A few months back there was something on this forum about having to pay tax on income/pension if it was brought into Thailand the same year .

I cannot find the thread now, does anyone remember it ?

[lopburi3]

A few months back there was something on this forum about having to pay tax on income/pension if it was brought into Thailand the same year .

I cannot find the thread now, does anyone remember it ?

Yes; and that was the primary basis of my "current income" comment. Believe it is listed on a web site of a major expat business tax/law firm but don't have the site at hand.

[seven]

Hello There !

I have just done some investigation on tax on money sent to Thailand for retirement purposes. I have only concentrated myself on the tax treaty between The Netherlands and Thailand since I am Dutch. But I would not be surprised if the same also applies in other tax treaties. Under the Dutch - Thai treaty it goes as follows:

1) Thailand is the party who can impose tax. Not the Dutch tax authority and that is good news for us.

2) So if we remit money to Thailand we are in principle taxable under Thai law unless you can prove that the money you remit is earned in the year (s) before. If you can prove that, and this is not too difficult, you are tax exempted.

I also heard that what I described under 2 is applicable to Thais bringing money into the country earned the year before. As for farangs ( not being Dutch), I think that much will depend on whether or not there is a tax treaty between Thailand and the country you currently live in. But that needs to be further investigated.

I hope the above helps.

Seven

[Maverick]

A few months back there was something on this forum about having to pay tax on income/pension if it was brought into Thailand the same year .

I cannot find the thread now, does anyone remember it ?

That was me. Seven is spot on - tax is due (I am told by me friendly (!) local Tax Accountant, medium sized firm not mickey mouse) if u are here 180 days in total or more AND bring the assessable income into Thailand IN THE SAME YEAR it is earnt (very important point). There may well be double tax treaties that affect the above, but curiously they didnt mention it at all but someone has mentioned it since in this forum and seven has confirmed that in his case there is one so I think my Accountant was a bit tardy. Being retired would not have any bearing at all - retirees would apprear to be in the frame as much as anyone else who spends 180 days or more here. See Revenue Code of Thailand section 41 for the full text. A thai tax year is a calender year by the way.

[dr_Pat_Pong]

A few months back there was something on this forum about having to pay tax on income/pension if it was brought into Thailand the same year .

I cannot find the thread now, does anyone remember it ?

That was me. Seven is spot on - tax is due (I am told by me friendly (!) local Tax Accountant, medium sized firm not mickey mouse) if u are here 180 days in total or more AND bring the assessable income into Thailand IN THE SAME YEAR it is earnt (very important point). There may well be double tax treaties that affect the above, but curiously they didnt mention it at all but someone has mentioned it since in this forum and seven has confirmed that in his case there is one so I think my Accountant was a bit tardy. Being retired would not have any bearing at all - retirees would apprear to be in the frame as much as anyone else who spends 180 days or more here. See Revenue Code of Thailand section 41 for the full text. A thai tax year is a calender year by the way.

The Thai tax year actually is 01 October to 30 September

[opalhort]

The Thai tax year actually is 01 October to 30 September

Dr. PP, I thought the Oct.-Sep. was the fiscal year of the Thai government, but when it comes to personal income tax it is 01 Jan. - 31 Dec.

or am I mistaken?

opalhort

[mrmnp]

Maverick is right on!! I read the same information in the Bangkok Post in one of their articles written by a law firm.

The critical criteria is the "in the year earned" and "brought into Thailand" The article opined that the tax department would have a difficult time determining the specie (origin) of funds taken from a pre-establish retirement fund into which additional funds were deposited on any regular basis.

Not awaiting the tax man to create a presumption to be rebutted by us that the funds were NOT earned in the year brought into Thailand, I immediately created a separate savings account into which this years retirement funds would be deposited, so I could prove that, when I bring this years earned funds into Thailand next year from that account, it was earned in the year previous.

For those not so fortunate as to have a years retirement payments in reserve, keep your fingers crossed that the tax man doesn't get the authority to create a rebuttable presumption.