Will I have to pay taxes on my social security or pension

[NancyL]

Bangkok Bank does withhold taxes from the interest payments they post to our accounts. I think there is some provision for claiming that money back from the Thai gov't (?) or the bank (?), but I've just been claiming it as foreign tax paid when I file our U.S. federal tax returns. I figure it all balances out. Don't know if this is right, though, but the amount of money is fairly small and we haven't been audited (yet!)

[lopburi3]

Bangkok Bank does not normally withhold tax on regular savings accounts below the 20k amount as stated previously - suspect you are talking fixed deposit accounts (or some other special catagory - as you likely keep a large amount on deposit for visas) where they indeed do withhold tax but that can be claimed back.

[TallGuyJohninBKK]

Interestingly, right now, typical Thai bank interest rates available to farangs would leave you lucky to get 2.5%.

If you apply that against an 800,000 baht deposit, without factoring in compounding, it works out to 20,000b for the year.

So, with the way interest rates are going these days, it's certainly possible to keep an extension of stay-based 800K deposit and not necessarily crack the 20,000 baht per year interest threshhold for Thai tax withholding.

I opened a new savings account just this week, and the Thai bank in question just days before my opening had cut their rates, including from 2.5% down to a new 2.3% on the account, which requires maintaining a minimum 100,000 baht balance, and will only pay interest if the monthly balance remained above that amount.

They had another 2.5% account with a much lower balance requirement, but it only credited interest twice a year, as opposed to a monthly interest credit with the account I chose.

[mahjongguy]

"...I've just been claiming it as foreign tax paid when I file our U.S. federal tax returns."

Per the IRS, if you have the opportunity to re-claim withholding then you are obligated to do so.

So, you should claim the entire amount of interest earned as foreign income, not just the amount you received. Then go to the Finance Ministry, get a Tax Identification Number, and file (usually in March) for a refund. I've been told it's an easy process.

[Felt 35]

That depends on what country you come from, you don't pay tax in Thailand from your pension, You don't pay tax on your pension if you come from Australia,any other country I don't know!

Is that both government pension and private super pension?

For Thailand no pension is taxable.

Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.

http://www.rd.go.th/publish/6045.0.html

[lopburi3]

There are bilateral tax agreements in place that modify above rules and the US has one of them - federal pensions are taxed at source and are not subject to Thai tax per agreement. And in practice Thailand does not tax money brought into the country by foreigners in any case.

[pmarlin]

That depends on what country you come from, you don't pay tax in Thailand from your pension, You don't pay tax on your pension if you come from Australia,any other country I don't know!

Is that both government pension and private super pension?

For Thailand no pension is taxable.

Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand.

http://www.rd.go.th/publish/6045.0.html

It's not that simple. Thailand has tax treaties with several other countries that specifies how that countries citizens are to be treated when it comes to taxation. For example an American can live here 365 days a year and his Retirement pension and Social security From outside Thailand is NOT taxed by the Thai Government. Likewise some Thais getting US benefit checks like death benefits, widows benefits are not taxed by the US government if they are living here in Thailand.

[Arkady]

Thai tax law requires those resident in Thailand for over 180 days in a tax year to pay tax on any income earned overseas if they remit to Thailand within 12 months of the income arising. In actual fact there is no checking on when this sort of income arose. It is more of an issue for things like capital gains on overseas stock sales through Thai brokers. In that case you have be careful not to remit profits back to Thailand within 12 months.

[Pib]

Interestingly, right now, typical Thai bank interest rates available to farangs would leave you lucky to get 2.5%.

If you apply that against an 800,000 baht deposit, without factoring in compounding, it works out to 20,000b for the year.

So, with the way interest rates are going these days, it's certainly possible to keep an extension of stay-based 800K deposit and not necessarily crack the 20,000 baht per year interest threshhold for Thai tax withholding.

I opened a new savings account just this week, and the Thai bank in question just days before my opening had cut their rates, including from 2.5% down to a new 2.3% on the account, which requires maintaining a minimum 100,000 baht balance, and will only pay interest if the monthly balance remained above that amount.

They had another 2.5% account with a much lower balance requirement, but it only credited interest twice a year, as opposed to a monthly interest credit with the account I chose.

I've never had tax withheld on interest earned by my Bangkok Bank regular savings accounts (i.e., the ones that can come with debit cards if desired), but I've never exceeded Bt20K interest earned per year...but I have earned around Bt10K interest a couple of times....as mentioned no withholding tax.

However, but, on my Bangkok Bank traditional "fixed savings" accounts 15% tax is withheld on "any" amount of interest earned; it does not have to exceed Bt20K interested earned. That's Thai law. Now I mentioned "traditional" as some Thai banks have some special fixed accounts that are a variant of a traditional fixed account and apparently they don't withhold tax under certain conditions/criteria.

[TallGuyJohninBKK]

Pib, I do seem to remember some distinction being made between regular savings accounts vs fixed deposit accounts in the other main threads on Thai bank account tax withholding.

At any rate, the new account I opened also was a regular Thai savings account, not fixed deposit, so presumably they're correct about no withholding for interest up to 20,000b per year.

[Pib]

Pib, I do seem to remember some distinction being made between regular savings accounts vs fixed deposit accounts in the other main threads on Thai bank account tax withholding.

At any rate, the new account I opened also was a regular Thai savings account, not fixed deposit, so presumably they're correct about no withholding for interest up to 20,000b per year.

Yeap, no withholding tax on a regular savings account up to Bt20K interest earned per year.

But on a traditional "fixed" account which pays the significantly higher interests rates a 15% withholding tax to interest earned applies to any amount of interest earned even if say Bt1,000 interest earned....they would pay the Bt1,000 interest to your account and in a simultaneous transaction withhold 15% or Bt150 and send it to the govt tax coffers....you end up with a net interest of Bt850. But you can get the Bt150 withheld easily refund each year by filing a tax refund request with your local revenue office as discussed in other threads.

[TallGuyJohninBKK]

Re the issue of saving vs fixed term accounts, right now, from my recent informal survey of Thai bank deposit rates, there seem to be a variety of regular savings accounts on offer with as good or better interest rates than most of those same banks' fixed term deposits.

I don't mean the banks' routine, regular savings accounts. But several of them seem to have particular non fixed term accounts on offer with 2.3 to 2.5% rates, whereas to get those same rates with fixed term deposits, you'd have to go out to four or five years of terms. And even then, you wouldn't do any better than 2.5% typically, but would at least match it.

[GOLDBUGGY]

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If you mean in Thailand, then no, you do not have to pay Thai tax on US income... Uncle Sugar will take care of that on the US end...

The Canadian Beaver will do it for you in Canada to.

[gk10002000]

They are exempt from taxes here but you will still get hit at the usual rates back home (assuming you are from the U S)

While saying they are exempt from Thai taxes is nice, the Thai Tax form says no such thing. It says list "all" income. I know many have taken that to mean income from Thai sources only, such as teaching. I have looked into this before and never got anyting formal that says US income, of any type is exempt from Thai taxes.

[meatboy]

Interestingly, right now, typical Thai bank interest rates available to farangs would leave you lucky to get 2.5%.

If you apply that against an 800,000 baht deposit, without factoring in compounding, it works out to 20,000b for the year.

So, with the way interest rates are going these days, it's certainly possible to keep an extension of stay-based 800K deposit and not necessarily crack the 20,000 baht per year interest threshhold for Thai tax withholding.

I opened a new savings account just this week, and the Thai bank in question just days before my opening had cut their rates, including from 2.5% down to a new 2.3% on the account, which requires maintaining a minimum 100,000 baht balance, and will only pay interest if the monthly balance remained above that amount.

They had another 2.5% account with a much lower balance requirement, but it only credited interest twice a year, as opposed to a monthly interest credit with the account I chose.

I've never had tax withheld on interest earned by my Bangkok Bank regular savings accounts (i.e., the ones that can come with debit cards if desired), but I've never exceeded Bt20K interest earned per year...but I have earned around Bt10K interest a couple of times....as mentioned no withholding tax.

However, but, on my Bangkok Bank traditional "fixed savings" accounts 15% tax is withheld on "any" amount of interest earned; it does not have to exceed Bt20K interested earned. That's Thai law. Now I mentioned "traditional" as some Thai banks have some special fixed accounts that are a variant of a traditional fixed account and apparently they don't withhold tax under certain conditions/criteria.

I and the wf.have many fixed term accs.and have some idea of what they mean by not exceeding the 20k.limit.

I posted this in the banking forum[see bank interest rates] but here goes again.on any acc.that pays interest we have an allowance of around 140,000bht. so to ilistrate 5million bht.invested for 12xmonths @ 3%=150,000earned before tax.

your tax deducted would be 150,000 x 15%=22,500bht you can then claim up to 20,000bht.back thus leaving you with a tax liability of 2,500bht.to pay.we all or most of us know that anything to do with finance they have to complicate things.

Edited June 8, 2014 by meatboy

[ubonjoe]

They are exempt from taxes here but you will still get hit at the usual rates back home (assuming you are from the U S)

While saying they are exempt from Thai taxes is nice, the Thai Tax form says no such thing. It says list "all" income. I know many have taken that to mean income from Thai sources only, such as teaching. I have looked into this before and never got anyting formal that says US income, of any type is exempt from Thai taxes.

The Thai tax law is written such that only income earned from working and rental income earned outside Thailand is taxable income.

[ableguy]

as a usa retiree you are allowed to earn 35000 US dollars tax free, however I do not get that and still a private pension from usa still deduct tax have written evert where complaining to no avail, so get a refund every year but still a pain in the ass.

[Langsuan Man]

as a usa retiree you are allowed to earn 35000 US dollars tax free, however I do not get that and still a private pension from usa still deduct tax have written evert where complaining to no avail, so get a refund every year but still a pain in the ass.

Source for your statement regarding $35K .please, As well as the source of your a private pension from usa still deduct tax .

It is called withholding and YOU determine how much based upon the IRS Form W-4 that you submit and is withheld from either earnings, pensions, IRA distributions, or US Social Security. All you have to do is submit a new W-4 to whoever manages your private pension telling them that you want 0 withheld and then you will not have to file to get the money back (refund)