Has declaring income for retirement visas got tax implications?

[Card]

When you use the 65000 baht per month or above route (rather than 800,000 baht in the bank) for extending a retirement visa mean that you should also fill in a tax form (or be asked to by the tax dept) even if you already pay tax on the whole income in your home country, as I do? I know there is a double taxation agreement between Thailand and the UK, but how does this declaration of income fog the issue?

[mahjongguy]

"...how does this declaration of income fog the issue?"

It doesn't. You won't be required to file a tax form in Thailand for that situation.

Retirees who have bank deposits here earning interest from which 15% tax has been withheld may file a tax form if they wish to have that amount returned. Example: 800,000 baht earned 16,000 baht interest in a fixed account from which 2,400 baht was withheld by the bank and forwarded to the tax authority.

[Zanarski]

If you reside in Thailand for 180 days or more in any tax year and during that tax year remit income to Thailand that is earned or received in that tax year, then you could be liable to income tax. If you paid income tax in your "home country" and an agreement exists between Thailand and that country covering that income, then this can be used as a credit against Thai tax liability. If you claim a refund of tax paid on a fixed deposit account, the tax office may wish to audit you tax affairs before issuing any refund.

[Card]

If you reside in Thailand for 180 days or more in any tax year and during that tax year remit income to Thailand that is earned or received in that tax year, then you could be liable to income tax. If you paid income tax in your "home country" and an agreement exists between Thailand and that country covering that income, then this can be used as a credit against Thai tax liability. If you claim a refund of tax paid on a fixed deposit account, the tax office may wish to audit you tax affairs before issuing any refund.

Yes, I realise this, but thanks.

So if I don't claim a refund then I am not obligated to file a tax return when I remit income that has already been taxed in the UK to Thailand?

[ubonjoe]

If you reside in Thailand for 180 days or more in any tax year and during that tax year remit income to Thailand that is earned or received in that tax year, then you could be liable to income tax. If you paid income tax in your "home country" and an agreement exists between Thailand and that country covering that income, then this can be used as a credit against Thai tax liability. If you claim a refund of tax paid on a fixed deposit account, the tax office may wish to audit you tax affairs before issuing any refund.

That is the general requirements. It is only the money brought into Thailand that was earned that tax year.

There is also certain types of income that is not taxable. A pension is one of them.

[Zanarski]

The agreement with the UK certainly covers pensions taxed exclusively in the originating country but company and personal pensions are only covered by the double taxation part of the agreement. Pay tax in UK and use the credit to offset Thai tax liability. Company pensions are regarded as a taxable income in Thailand.

[ubonjoe]

No pension is taxable here.

[dinger]

If you reside in Thailand for 180 days or more in any tax year and during that tax year remit income to Thailand that is earned or received in that tax year, then you could be liable to income tax. If you paid income tax in your "home country" and an agreement exists between Thailand and that country covering that income, then this can be used as a credit against Thai tax liability. If you claim a refund of tax paid on a fixed deposit account, the tax office may wish to audit you tax affairs before issuing any refund.

That is the general requirements. It is only the money brought into Thailand that was earned that tax year.

There is also certain types of income that is not taxable. A pension is one of them.

I have seen this stated several times and am confused. So if I earn money in my home country pay tax on that money in my home country and then bring it into Thailand the same tax year I am liable for tax in Thailand? How do they seperate what was earned this tax year and what came from last tax year

[ubonjoe]

If you reside in Thailand for 180 days or more in any tax year and during that tax year remit income to Thailand that is earned or received in that tax year, then you could be liable to income tax. If you paid income tax in your "home country" and an agreement exists between Thailand and that country covering that income, then this can be used as a credit against Thai tax liability. If you claim a refund of tax paid on a fixed deposit account, the tax office may wish to audit you tax affairs before issuing any refund.

That is the general requirements. It is only the money brought into Thailand that was earned that tax year.

There is also certain types of income that is not taxable. A pension is one of them.

I have seen this stated several times and am confused. So if I earn money in my home country pay tax on that money in my home country and then bring it into Thailand the same tax year I am liable for tax in Thailand? How do they seperate what was earned this tax year and what came from last tax year

Money earned in the past would typically be money from savings, pension funds and etc.

They don't look for money coming in. You would have to declare it in order for them to know about it.

[Zanarski]

I am sorry but you are wrong, read the tax law or the guidelines. Each clearly show that pensions are taxable. State pensions are exempt as you indicated. If people remit non state pension income into the country in the same tax year as it was received without declaring it, they are breaking the law.

[ubonjoe]

I am sorry but you are wrong, read the tax law or the guidelines. Each clearly show that pensions are taxable. State pensions are exempt as you indicated. If people remit non state pension income into the country in the same tax year as it was received without declaring it, they are breaking the law.

I have and it is clear that retirement pensions are not taxable, Basically only income from working is taxable plus rental income and such.

[dinger]

I am sorry but you are wrong, read the tax law or the guidelines. Each clearly show that pensions are taxable. State pensions are exempt as you indicated. If people remit non state pension income into the country in the same tax year as it was received without declaring it, they are breaking the law.

Just so I get this correct. You are saying that if I have a Non State Pension in my home country and pay tax on that money as I receive it, then send the already taxed money to Thailand in the same tax year, I owe the Thai Goverenment tax onmoney that has already been taxed?

[Time Traveller]

If you reside in Thailand for 180 days or more in any tax year and during that tax year remit income to Thailand that is earned or received in that tax year, then you could be liable to income tax. If you paid income tax in your "home country" and an agreement exists between Thailand and that country covering that income, then this can be used as a credit against Thai tax liability. If you claim a refund of tax paid on a fixed deposit account, the tax office may wish to audit you tax affairs before issuing any refund.

That is the general requirements. It is only the money brought into Thailand that was earned that tax year.

There is also certain types of income that is not taxable. A pension is one of them.

I have seen this stated several times and am confused. So if I earn money in my home country pay tax on that money in my home country and then bring it into Thailand the same tax year I am liable for tax in Thailand? How do they seperate what was earned this tax year and what came from last tax year

Ubonjoe is making this confusing. All income - both earned and unearned - is liable for tax if it is remitted into thailand the same year it was received.

Often you would not need to pay tax in thailand due to double taxation treaties. That is, if the income already had tax withheld or paid in the source country. However for that to apply you normally need to file a Thai tax return and then use the foreign tax credits against any thai tax liability. Not filing is the same as evading tax.

On the other hand, some incomes which has tax with held can be excluded from tax filing. Everyones situation is different so please speak to an account before making decisions based on the comments in this thread

[Zanarski]

Thailand Revenue code (Law)

Section 40, Item 1

Pensions are included as taxable income. It's there in black and white, I wish it was not, but there it is. However, I was wrong to say that pensions are referred to as taxable in the guidelines. I'll certainly bring it up with the tax office again when I go next year.

[ubonjoe]

Thailand Revenue code (Law)

Section 40, Item 1

Pensions are included as taxable income. It's there in black and white, I wish it was not, but there it is. However, I was wrong to say that pensions are referred to as taxable in the guidelines. I'll certainly bring it up with the tax office again when I go next year.

"Section 40 Assessable income is income of the following categories including any amount of tax paid by the payer of income or by any other person on behalf of a taxpayer.

(1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.^4"

I think the translation would have to be checked.for the word pension.

In the context it is used I think it is this definition of pension that would apply .

"Pension (lodging)"

http://en.wikipedia.org/wiki/Pension_(lodging)

Are you employed while on a pension in the context we are discussing?

[paddyjenkins]

So just to avoid doubt, for retires it would be safer to use the 800,000 savings to obtain the visa rather than declare 65k income per month to obtain it

[ubonjoe]

So just to avoid doubt, for retires it would be safer to use the 800,000 savings to obtain the visa rather than declare 65k income per month to obtain it

It makes no difference. If you have the income that is what you should use.

[Zanarski]

Thailand Revenue code (Law)

Section 40, Item 1

Pensions are included as taxable income. It's there in black and white, I wish it was not, but there it is. However, I was wrong to say that pensions are referred to as taxable in the guidelines. I'll certainly bring it up with the tax office again when I go next year.

"Section 40 Assessable income is income of the following categories including any amount of tax paid by the payer of income or by any other person on behalf of a taxpayer.

(1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.^4"

I think the translation would have to be checked.for the word pension.

In the context it is used I think it is this definition of pension that would apply .

"Pension (lodging)"

http://en.wikipedia.org/wiki/Pension_(lodging)

Are you employed while on a pension in the context we are discussing?

I would certainly be very happy to be proved wrong as I could have a big tax bill at the end of the year, and who want's that?

[mahjongguy]

"So just to avoid doubt, for retires it would be safer to use the 800,000 savings to obtain the visa rather than declare 65k income per month to obtain it"

No, it's not "safer". It's a choice, and applicants for retirement extensions make that choice according to various personal and logistical reasons. Some don't have the cash or hate to keep it here, and have to deal with getting an income declaration from their Embassy every year. Some have lots of cash back home but little or no income.

Taxes don't figure into it because they don't apply. The only exception might be someone who lives here more than 180 days a year yet works offshore and their salary is paid directly into a Thai bank account. That person needs to file a Thai tax form even though a tax treaty might negate (or lessen) any tax owed to Thailand.

[Time Traveller]

Thailand Revenue code (Law)

Section 40, Item 1

Pensions are included as taxable income. It's there in black and white, I wish it was not, but there it is. However, I was wrong to say that pensions are referred to as taxable in the guidelines. I'll certainly bring it up with the tax office again when I go next year.

"Section 40 Assessable income is income of the following categories including any amount of tax paid by the payer of income or by any other person on behalf of a taxpayer.

(1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.^4"

I think the translation would have to be checked.for the word pension.

In the context it is used I think it is this definition of pension that would apply .

"Pension (lodging)"

http://en.wikipedia.org/wiki/Pension_(lodging)

Are you employed while on a pension in the context we are discussing?

Ubonjoe, I have to ask how moderators on this site can give out misleading tax advice, then when it's shown from the tax website the law which refutes your claim, you then question the accuracy of the translation?

Refuse to believe it if you want, but foreign income brought into thailand in the same year is taxable . Whether you declare it or not does not change the law.

[ubonjoe]

Thailand Revenue code (Law)

Section 40, Item 1

Pensions are included as taxable income. It's there in black and white, I wish it was not, but there it is. However, I was wrong to say that pensions are referred to as taxable in the guidelines. I'll certainly bring it up with the tax office again when I go next year.

"Section 40 Assessable income is income of the following categories including any amount of tax paid by the payer of income or by any other person on behalf of a taxpayer.

(1) Income derived from employment, whether in the form of salary, wage, per diem, bonus, bounty, gratuity, pension, house rent allowance, monetary value of rent-free residence provided by an employer, payment of debt liability of an employee made by an employer, or any money, property or benefit derived from employment.^4"

I think the translation would have to be checked.for the word pension.

In the context it is used I think it is this definition of pension that would apply .

"Pension (lodging)"

http://en.wikipedia.org/wiki/Pension_(lodging)

Are you employed while on a pension in the context we are discussing?

Ubonjoe, I have to ask how moderators on this site can give out misleading tax advice, then when it's shown from the tax website the law which refutes your claim, you then question the accuracy of the translation?

Refuse to believe it if you want, but foreign income brought into thailand in the same year is taxable . Whether you declare it or not does not change the law.

I posted the info and explained what I based my opinion on as far as pension income being taxable and you now have brought in another subject from an earlier post. I did not question the translation I merely said it should be checked which means looking see what it says in Thai. The usage of the word pension is what I questioned because pension does have 2 definitions and it's usage in the Thai text would be important.

I even agreed that if you earn taxable income and bring it into the country during the year it is earned it is taxable.

[Time Traveller]

Ubonjoe, I have to ask how moderators on this site can give out misleading tax advice, then when it's shown from the tax website the law which refutes your claim, you then question the accuracy of the translation?

Refuse to believe it if you want, but foreign income brought into thailand in the same year is taxable . Whether you declare it or not does not change the law.

I posted the info and explained what I based my opinion on as far as pension income being taxable and you now have brought in another subject from an earlier post. I did not question the translation I merely said it should be checked which means looking see what it says in Thai. The usage of the word pension is what I questioned because pension does have 2 definitions and it's usage in the Thai text would be important.

I even agreed that if you earn taxable income and bring it into the country during the year it is earned it is taxable.

yeah ok you corrected me. Sorry

[chiang mai]

I suspect the rules on the taxation of pensions varies by country, in the case of the UK however, UK state pensions can only be taxed in the UK, dunno about Swaziland et al.

Other income must be both earned and remiited in the same tax year for a potential liability to Thai tax to arise.

[paddyjenkins]

So just to avoid doubt, for retires it would be safer to use the 800,000 savings to obtain the visa rather than declare 65k income per month to obtain it

It makes no difference. If you have the income that is what you should use.

If there is any chance at all that pension income is taxable in Thailand, I,e, the 65k a month, then it most certainly would make a difference as savings, is, the 800k, would be far less likely to be taxable if that money is not declared as a form of income.

[ballbreaker]

So just to avoid doubt, for retires it would be safer to use the 800,000 savings to obtain the visa rather than declare 65k income per month to obtain it

It makes no difference. If you have the income that is what you should use.

If there is any chance at all that pension income is taxable in Thailand, I,e, the 65k a month, then it most certainly would make a difference as savings, is, the 800k, would be far less likely to be taxable if that money is not declared as a form of income.

In the case of US pension and social security payments the answer is no they are not taxable.

The issue is addressed in the US-Thailand tax agreement Ariticle 20.

Check if your home country has tax treaty with Thailand.

[Estrada]

The agreement with the UK certainly covers pensions taxed exclusively in the originating country but company and personal pensions are only covered by the double taxation part of the agreement. Pay tax in UK and use the credit to offset Thai tax liability. Company pensions are regarded as a taxable income in Thailand.

I recently went to the tax office in order to pay tax if necessary on my pension incomes. However they told me that they do not tax ANY pension income if you are a retiree.

[chiang mai]

The agreement with the UK certainly covers pensions taxed exclusively in the originating country but company and personal pensions are only covered by the double taxation part of the agreement. Pay tax in UK and use the credit to offset Thai tax liability. Company pensions are regarded as a taxable income in Thailand.

I recently went to the tax office in order to pay tax if necessary on my pension incomes. However they told me that they do not tax ANY pension income if you are a retiree.

I believe they don't really know at the local level, a local tax office wouldn't even begin to know what draw down is.

[Estrada]

I am sorry but you are wrong, read the tax law or the guidelines. Each clearly show that pensions are taxable. State pensions are exempt as you indicated. If people remit non state pension income into the country in the same tax year as it was received without declaring it, they are breaking the law.

You are wrong, I already discussed this with several Senior Officials in the Thai Tax Office, and they told me that no pension incomes are taxable.

[dinger]

Yes I have a point here but first let me ask this question. Is money in my savings account in another country taxable when I

bring it into Thailand?

[chiang mai]

No.

And before you go there, accountancy rules involve FIFO, LIFO, FILO etc,