Work Visa (work From Home)

[Locturian]

Hi guys

First of all, thank you for a great forum...

Although it may be a triviel and before asked question, I'll be so bold to to ask it anyway

First, let me introduce my self - I'm a 23 year old danish guy with a thai wife - I'm so fortunate to have arranged it with my work so I can work from Thailand over the Internet ( I work as a systems developer, mainly Internet applications).

Now, here's my problem - Which visa do I require to make my dream come true, and what is neccecary to optain it? I would like to stay as long as possible without having to "bend" the visa-rules...

Please guide me :-)

NB: I appoligize for typos or bad gramma - English is not my native tounge....

[Indo-Siam]

Hi -

Here is how it goes. You do not work in Thailand - remember that. Your employer is outside Thailand, and you are presumably paid outside Thailand, and YOU DO NOT WORK IN THAILAND.

Possibly, you oversee your work from Thailand, on the Intenet, during periods that you are not working. If you remember that, and you make it clear that you work for employer outside Thailand, and are paid outside Thailand, the Thai Revenue Department will not have any problem with you - just don't go digging any further. Don't let anyone tell you otherwise. Your post was just worded wrong, because English is not your native tongue. Don't argue, don't listen to anyone who tells you that you need a work permit. What you do in your own home, on the Internet - is not anyone else's business.

Now - assuming that you have a Thai marriage registration certificate, and that you and Thai wife live together, you can get a non-immigrant Class O visa, and then a non-immigrant entry permit - and you can then extend that entry permit by demonstrating that you are "supporting a Thai spouse." The easiest way to do this is to remit into Thailand, to a Thai bank account bearing your name, the lump sum of 400,000 baht. You will have to leave it in the account for a period of about 40 days - and will then be free to spend that money.

If you want help with the process of getting a non-immigrant entry permit extension - my company, and a lot of other similar firms, can assist you.

Cheers!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[Locturian]

Hi

Thanks for the reply... I'm really new at this and really unsertain on how to proceed - Not interested in pissing off the Thai Immigration... So I guess it's a BAD idea to repport to the Danish tax guys, that i work abroad? It was my plan cause I can save the 49% tax I pay now (yeah, we have the higest tax % in the world )

And, I don't have the "official" papers on the marriage right now, as there were some mess up last time I was in Thailand - Gonna be fixed, but not now.. And for the 400.000THB - That's alot of dough - Don't have that kinda spending money right now...

So my options are limited to a regular "Non immigation" visa? And I cannot state to anyone that I work from Thailand? Is there not any options for keeping it legit - Working from Thailand for a Danish employer that is?

Really appreciate the help

[Maestro]

So I guess it's a BAD idea to repport to the Danish tax guys, that i work abroad? It was my plan cause I can save the 49% tax I pay now (yeah, we have the higest tax % in the world

Your intention, as I understand it, is to transfer your legal, tax-paying residence from Denmark to Thailand. This is understandable. As your Danish employer is on record with the Danish tax authorities as paying a salary to you, presumably into a bank account in Denmark, it is obviously necessary for you to get on record with the Danish authorities, in particular the tax office, as having your legal domicile in Thailand.

There is probably a procedure to follow, some form to fill out and sign, in order to give up your legal residence in Denmark. Check it out with the appropriate office (municipal office?)

Then you need to establish legal residence in Thailand. Registering with the Danish embassy in Bangkok is one step, and may be sufficient for the Danish authorities. An extension of your permission to stay in Thailand, after entering on a non-O visa, for the purpose of supporting your Thai wife would give you an official Thai document, a certificate of some kind, I forgot what it is called, I believe something confirming your address in Thailand, but this may not be necessary to establish, for the Danish authorities, the fact that you have moved your domicile outside Denmark.

But is it necessary for you to pay income tax in Thailand on the monthly salary paid to you by your Danish employer into your Danish bank account? Officially, I understand, income earned abroad is taxable in Thailand only if you bring it into Thailand during the year in which it is earned. Therefore, if you are ever questioned by Thai authorities (e.g. Immigration Office) on the provenance of the money you use to cover your living expenses in Thailand and if you declare that you transfer money from your savings, you should not be liable for income taxes in Thailand. The advice given by Indo-Siam looks sound to me.

You are talking about living in Thailand for an indefinite period and you are disinclined to keep have a balance in a Thai bank account of at least 400,000 Baht once a year at the time of applying for an annual extension of your permission to stay. That leaves you with the option of starting out with a multiple-entry non-O visa you obtain from a Thai consulate in Denmark, valid for one year, do visa runs every 90 days, and when that visa expires go the Thai consulate in a nearby country and obtain a new non-O visa, but you may not always be able to get a multiple-entry visa.

If you are planning for the long term, transferring 400,000 Baht to a Thai bank account (savings account) in your name is the ideal solution and is not really that much money. Consider it a buffer for a possible emergency. It does not mean that you have to bring that same amount into Thailand every year if you do not spend that much during the year; it is sufficient to top up your account to be again over 400,000 Baht before every annual application for extension of stay.

---------------

Maestro

[Indo-Siam]

Another approach is to offically set up and work in Thailand. Two ways (and there may be others):

In corporate your own company in Thailand, as a contract staffing company, and then work for that company. Your Thai company then invoices your Danish employer monthly for your services. It pays whatever opereating costs it must (corporate tax - assume about 3% of gross billings); office rent; monthly bookkeeping,;etc), and then pays the rest out to you as salary. Once you havethe Thai marriageregistration certificate, your company need only register 1,000,000 baht capital, to qualify to sponsor your work permit. You still need to go outside Thailand to get your non-immigrant visa (necessary for the work permit). If you can pay peronal income taxes monthly on a salary of at least 40,000 baht, after a year or so, you will be able to extend your entry permit based on "support of a Thai spouse".

Or - if you will live in Bangkok, and it is worth it to you, I can give you employment as a consultant for a second company that I own here that is eligible to sppnsor a work permit. That Thai company will invoice your overseaes employer for whatever monthly amount is worked out. My company will deduct from the amount received certain overhead expenses, and 15,000 contribution to company general revenues. We will also employ your Thai wife. We will pay out to you as as salary all money received in excess of the overhead and company contribution. With the addition of your wife to the Thai payroll, this Thai company will qualify to sponsor you for an extended entry permit. We will also charge you a nominal rate for work permit and extended entry permit processing.

Only you can tell if the costs outlined in either of thesre two approaches are worth it to you, compared to the lower cost approach of simply operating on the basis of making 90 day visa runs - without having formal employment in Thailand. The 90-day approach was correctly described above by another poster.

Cheers!

Steve Sykes

Managing Director

Indo-Siam Group

Bangkok

[email protected]

www.thaistartup.com

[kudroz]

Thanks for the reply... I'm really new at this and really unsertain on how to proceed - Not interested in pissing off the Thai Immigration... So I guess it's a BAD idea to repport to the Danish tax guys, that i work abroad? It was my plan cause I can save the 49% tax I pay now (yeah, we have the higest tax % in the world )

Because you are not working in Thailand - nor working for a Thai company, the income you are earning from your Denmark employer will be taxed in Denmark. And if you bring some of that money into Thailand - you will also be liable to pay Thai taxes on the money you have brought into Thailand.

Although, because there is a Double Tax Treaty (DTT) between Denmark and Thailand - you will get a tax credit on the taxes you already paid in Denmark. (http://www.rd.go.th/publish/800.0.html)

It is my understanding that the Thai tax authorities are not very familiar with processing such cases - so it might be easier to just not bother with filing taxes with the Thai tax authorities at all; since you will end-up not paying taxes anyways because of the DTT.

[rishi]

In Denmark, salaries are taxed at the source, meaning OP would only get (at most) 51% of his salary put into his account/pocket... unless he gets himself set up in Thailand in such a way that the Danish authorities accept him as residing outside of Denmark for more than half of the tax-year.

No chance, the Danish employer can avoid withholding (minimum) those 49% ... and no chance OP will be refunded without submitting proper documentation, that he duly pays tax of that income somewhere else... The Danish RD knows as least as many tricks as the Thai RD.

So - IMHO - the better approoach for OP is to get his Thai paperworks properly done.. The extra expenses should easily counterweight the mony saved by paying tax in Thailand rather than Denmark.

Assuming OP actually has an arrangement with a Danish employer as good as his OP suggests - a monthly income of 40,000 baht shouldn't be much of a problem - (inasmuch as this amount corresponds to the standard, public unemployment insurance payment).

[kudroz]

So - IMHO - the better approoach for OP is to get his Thai paperworks properly done.. The extra expenses should easily counterweight the mony saved by paying tax in Thailand rather than Denmark.

Assuming OP actually has an arrangement with a Danish employer as good as his OP suggests - a monthly income of 40,000 baht shouldn't be much of a problem - (inasmuch as this amount corresponds to the standard, public unemployment insurance payment).

My understanding is a person’s liability for income tax is based on his or her status as a resident or a non-resident. A person who is resident during a taxation year is subject to income tax on his or her worldwide income from all sources. Generally, a non-resident person is only subject to income tax on income from sources inside his country of citizenship.

Most of the OECD member countries will tax you on your income from your country of citizenship regardless of your residence.

Being reconized as a non-resident for tax purposes is not something easy. You have to sever all your significant residential ties and make sure that the centre of your vital interests is not in your country of citizenship. They want to make sure that you are not avoiding taxes for a predefined period of time with the intend to return.

If you have properties, bank accounts, dependants, dwelling place, spouse or common-law partner you have significant residential ties with your country of citizenship and they might consider you a resident for tax purposes. Since you are employed in Denmark - you have a major economic tie that might make you a factual resident for tax purposes.

The residence status of an individual can only be determined on a case by case basis after taking into consideration all of the relevant facts. I would suggest you contact a tax specialist who can advise you on your specifics.

*please note that the residence I am reffering to is the residence for tax purposes. You are automatically recognized a resident of Thailand for tax purposes if you aggregate a living in Thailand of more than 183 days per calendar year. You can be a resident for tax purposes in more than one (1) country.

[kudroz]

Now for the practical advise, if you want to save money and lower your taxes, you have to make sure the money isn't in your name. If you incorporate a company in Thailand (a juridical entity) with his residence in Thailand for tax purposes (the control and the "mind and management" of the Thai company has to be in Thailand) your company will be liable to pay taxes only in Thailand.

The bottom line is that you want to form a Private Thai Ltd. CO. that will invoice your current employer in Denmark for the equivalent of the salary you are currently receiving. Then your Private Thai Ltd. CO. will employ you and pay you a salary.

This sounds really complicated but it can be done swift and sharp with the help of a firm like Indo-Siam. I would suggest you contact Steve Sykes over there.

Edited May 7, 2006 by kudroz

[Maestro]

In Denmark, salaries are taxed at the source

I didn’t think about the withholding tax.

There you are, then, Locturian. Set up your own consulting company in Thailand, with yourself as employee and General Manager. Bill your Danish employer as a company. Draw a salary from your Thai company. Charge as much of your expenses as your accountant will allow you to your company account.

This will save you a lot of money and it will be perfectly correct and legal.

---------------

Maestro

[Locturian]

Thanks for all the input...

I recently talked to the Danish Tax office and they did not inform me of any speciel rules tied to me giving up paying tax here... Yes, the tax is drawn directly from my salary (Exactly 41% and 8% to some work fond). I was my understanding that if (yes, they DID inform me of this) my employer sends a letter to the tax office requesting that I could be freed of paying tax in Denmark, that this would be possible. The only demand was, that I had to spend at least 183 (odd number?) days away from Denmark. Maby I should call again, just to be sure...

I've given it some thought as to creating my own company in Thailand and billing my boss for the amount each month, but, I have some unfinished loans in the Bank that would give me some trouble - If I have an income in Denmark that is...

And, I'm not so familiar with having a company in Thailand, but in Denmark it's not so easy. You have to keep books, paperwork on each dime you spend, and file a repport of this each quarter. Tried it before, and to be honest, it got quite messy as I am not the best with keeping books and filing paperwork...

Why does everything in this world have to be so.. argh...

[Maestro]

I recently talked to the Danish Tax office and they did not inform me of any speciel rules tied to me giving up paying tax here... Yes, the tax is drawn directly from my salary (Exactly 41% and 8% to some work fond). I was my understanding that if (yes, they DID inform me of this) my employer sends a letter to the tax office requesting that I could be freed of paying tax in Denmark, that this would be possible. The only demand was, that I had to spend at least 183 (odd number?) days away from Denmark. Maby I should call again, just to be sure...

That’s a very reasonable rule. Obviously, that’s written in a Danish law, the tax law, or whatever. When you call them, ask them for the name of the law, what article in the law, where you can find the law on the Internet; they will be happy to tell you, and then you can look it up yourself to put your mind at ease.

---------------

Maestro

[Steve2UK]

Thanks for all the input...

I recently talked to the Danish Tax office and they did not inform me of any speciel rules tied to me giving up paying tax here... Yes, the tax is drawn directly from my salary (Exactly 41% and 8% to some work fond). I was my understanding that if (yes, they DID inform me of this) my employer sends a letter to the tax office requesting that I could be freed of paying tax in Denmark, that this would be possible. The only demand was, that I had to spend at least 183 (odd number?) days away from Denmark. Maby I should call again, just to be sure...

I've given it some thought as to creating my own company in Thailand and billing my boss for the amount each month, but, I have some unfinished loans in the Bank that would give me some trouble - If I have an income in Denmark that is...

And, I'm not so familiar with having a company in Thailand, but in Denmark it's not so easy. You have to keep books, paperwork on each dime you spend, and file a repport of this each quarter. Tried it before, and to be honest, it got quite messy as I am not the best with keeping books and filing paperwork...

Why does everything in this world have to be so.. argh...

183 days is just over half the year - 365 days divided by 2............. OK?

I've run my own small company in the UK and I'm a bit disorganised with the paperwork - just like you. But, it's easy with a good (and cheap) accountant - you'll need a Thai-speaker to fill out the Thai forms and follow the Thai tax rules, anyway........ No big deal for you to leave it all to that person - possibly set up and run by Indo-Siam.

Good luck