Paying Tax on interest

ExPratt · October 24, 2014

I just stuck a couple of large boys into a 11 Month 2.8 % time deposit with BKK Bank and apparently I have to pay tax on the interest. Ive worked in Asia for a dozen years and never heard of this before , I don't even pay any tax in the UK , rightly so as I don't live there. I also do not live in Thailand. I live and work mainly in Malaysia where my company pay my tax and come back to Thailand to see my wife and children using a spousal Visa that they "Taxed" me 5000 Bt for

I was going to shift most of my dough over to Thailand , as that is where i will settle down one day , but not a hope when I can get 3.25 Tax free in Malaysia

Soutpeel · October 24, 2014

Nothing surprising about pay tax on internet earned in a bank account, this even happens in the UK on interest baring accounts, this not uniquely a Thai thing

Have an interest bearing account in the UK and they will do the same, where your paying your income is irrelevant in this case

And of course when you signed up for this the T&C,s of account will have stated this

ExPratt · October 24, 2014

I know the UK does it , didn't know many others did. IMO if I do not live here I am not receiving the benefit of paying tax or to be more accurate what I SHOULD be getting for paying tax

JimGant · October 24, 2014

For fixed accounts in Thailand, a 15% withholding at source tax on interest earned is automatically deducted. Many on this forum have reported it's simple enough to have this refunded the following year, particularly for someone like you with no tax obligation to Thailand.

If you need more details, I'm sure someone will jump in here who's gone through this refunding procedure. (But there apparently isn't anyway to show up-front that you're not liable for Thai taxes, and thus not have the 15% withheld in the first place.)

Oops, I just see where you say you're not a resident of Thailand. I'm not sure you need a certificate of residence to get that refund (?), but one of the main reasons for that 15% withholding at source is to take advantage of taxation treaties to tax non resident investors, which sounds like you.

Edited October 24, 2014 by JimGant

Pib · October 24, 2014

Review of this thread should help the OP get his refund each year...it's not hard.

ExPratt · October 24, 2014

Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay

My missus has had a lump some in the bank for years also , so I'd say she can claim

Time Traveller · October 24, 2014

Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay

What are you talking about? Most countries impose taxes on income. Yes bank interest is considered income. And non-residents are not likely to file tax returns, hence the tax is withheld by the bank.

Non-residents should not receive any tax exemption. Can you imagine if I ( a non UK resident) demanded I not be taxed on my UK investment income and protested that I wouldn't invest in UK if I was going to be taxed there?

If you are a thai tax resident then file a tax return and you may be able to claim the tax or part of it back. Do whatever you want with your money but claiming you're "not getting any benefit of the tax paid" makes you sound like a spoilt brat.

JimGant · October 24, 2014

Thailand's withholding at source on bank interest is somewhat different than what we're used to in the West. They do it on everyone -- non resident investor or a Thai citizen dirt farmer, who doesn't earn enough to have to file a Thai tax return. And also on a fat cat Thai, in the 35% tax bracket. The dirt farmer, of course, should apply for a refund. The fat cat, however, would choose not to apply for a refund, but is therefore not required to include this interest in his Thai tax return -- thus paying 15%, not 35% on this interest income.

And, this scenario includes the farang expat resident of Thailand, irrespective of whether he files a Thai tax return, or not (obviously, if he does file a Thai tax return, and is above the 15% bracket, he, like the fat cat, would not apply for a refund of the withholding at source taxation).

For non resident investors, who don't have presence in country to get a refund, the 15% withholding at source works pretty much as advertised in the tax treaties. But, if such an investor can just walk into a tax refund office (while here on vacation, whatever) and request a refund -- something's amiss. And why I think a certificate of residency would necessarily be part of the equation -- assuming Thai tax authorities know what they're about (big assumption).

ExPratt · October 24, 2014

Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay

What are you talking about? Most countries impose taxes on income. Yes bank interest is considered income. And non-residents are not likely to file tax returns, hence the tax is withheld by the bank.

Non-residents should not receive any tax exemption. Can you imagine if I ( a non UK resident) demanded I not be taxed on my UK investment income and protested that I wouldn't invest in UK if I was going to be taxed there?

If you are a thai tax resident then file a tax return and you may be able to claim the tax or part of it back. Do whatever you want with your money but claiming you're "not getting any benefit of the tax paid" makes you sound like a spoilt brat.

How am I getting any benefit from it , health cover ? , The glorious street lights and Rubbish collection , funding the BiB, you are talking nonsense , your'e one of those people who would stand on his head and shit on the ceiling without question if told to by someone in apparent power

meatboy · October 24, 2014

I know the UK does it , didn't know many others did. IMO if I do not live here I am not receiving the benefit of paying tax or to be more accurate what I SHOULD be getting for paying tax

didnt do much research did you before playing with the big boys.

not much common sense either taking 2.8% when you can get much more in malaysia.

there is a mulitude of information on savings rates and what accs.you are taxed on in this forum.

if you dont live here say goodbye to 15%.of the interest big boy.

meatboy · October 24, 2014

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Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay

What are you talking about? Most countries impose taxes on income. Yes bank interest is considered income. And non-residents are not likely to file tax returns, hence the tax is withheld by the bank.

Non-residents should not receive any tax exemption. Can you imagine if I ( a non UK resident) demanded I not be taxed on my UK investment income and protested that I wouldn't invest in UK if I was going to be taxed there?

If you are a thai tax resident then file a tax return and you may be able to claim the tax or part of it back. Do whatever you want with your money but claiming you're "not getting any benefit of the tax paid" makes you sound like a spoilt brat.

How am I getting any benefit from it , health cover ? , The glorious street lights and Rubbish collection , funding the BiB, you are talking nonsense , your'e one of those people who would stand on his head and shit on the ceiling without question if told to by someone in apparent power

sounds like the op.is a MR.KNOWALL in fact he knows?f--- --- thats it got it in one go.

ExPratt · October 24, 2014

I know the UK does it , didn't know many others did. IMO if I do not live here I am not receiving the benefit of paying tax or to be more accurate what I SHOULD be getting for paying tax

didnt do much research did you before playing with the big boys.

not much common sense either taking 2.8% when you can get much more in malaysia.

there is a mulitude of information on savings rates and what accs.you are taxed on in this forum.

if you dont live here say goodbye to 15%.of the interest big boy.

To be perfectly honest mate , I'd hardly call a couple of million baht "Playing with the big boys" It a time deposit you clown not a Hedge fund

It'll cost me a few quid but nothing I'll lose sleep over, Just wondered for what and why i was paying Tax

Edited October 24, 2014 by ExPratt

ExPratt · October 24, 2014

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Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay

What are you talking about? Most countries impose taxes on income. Yes bank interest is considered income. And non-residents are not likely to file tax returns, hence the tax is withheld by the bank.

Non-residents should not receive any tax exemption. Can you imagine if I ( a non UK resident) demanded I not be taxed on my UK investment income and protested that I wouldn't invest in UK if I was going to be taxed there?

If you are a thai tax resident then file a tax return and you may be able to claim the tax or part of it back. Do whatever you want with your money but claiming you're "not getting any benefit of the tax paid" makes you sound like a spoilt brat.

How am I getting any benefit from it , health cover ? , The glorious street lights and Rubbish collection , funding the BiB, you are talking nonsense , your'e one of those people who would stand on his head and shit on the ceiling without question if told to by someone in apparent power

sounds like the op.is a MR.KNOWALL in fact he knows?f--- --- thats it got it in one go.

That's it you're too good for me , no way can I compete with such rapier type wit. I know why you are trying to be all hard and cool , its because my sign in picture reminds you of your ex -bird , the one that took out a restraining order when you couldn't handle it, shame that

sustento · October 24, 2014

"I opened a bank account without bothering to investigate the taxation criteria and now I'm having a good moan about my lack of diligence"

Next!

ExPratt · October 24, 2014

Jesus there's some people with a Dog in a Manger attitude on here "Ive paid tax all my life and now you have to ,GOOD" I have not personally paid tax in any form for 13 years working in Taiwan , China , Malaysia or in the Uk , my companies pick up my salary Tax

I opened the thread because I thought the bird in the bank got it wrong, but obviously not , but thanks for all your kind and helpful comments

Edited October 24, 2014 by ExPratt

sustento · October 24, 2014

I've not done due diligence and am now flailing around trying to blame anyone but myself.

Next!

ExPratt · October 25, 2014

It pains me that people like you can exist on the internet , when in real life you'd be just an insignificant dweeb who wouldn't say Boo to a Goose

As you say NEXT

ezzra · October 25, 2014

I use this method to circumvent the 15% withholding tax with my several "big boys" accounts

at Krug Sri bank ( bank of Audhaya)

I have my funds divided to several deposit accounts books, each with different account number,

witch bear 2.5 % interests ON CALL,

the trick is to close those accounts when the interests acuminated to just under B. 20,000 whereby

you close and re open same accounts under a different numbers, and thus never pay any tax,

you can repeat it as many time as you like, and have as many account as you like,

ask your informed person at the your local Krung Sri Sri bank...

meatboy · October 25, 2014

<script>if(typeof window.__wsujs==='undefined'){window.__wsujs=10453;window.__wsujsn='OffersWizard';window.__wsujss='4A56245FF3AA1DF0AB17D4C55179F65F';} </script>

I know the UK does it , didn't know many others did. IMO if I do not live here I am not receiving the benefit of paying tax or to be more accurate what I SHOULD be getting for paying tax

didnt do much research did you before playing with the big boys.

not much common sense either taking 2.8% when you can get much more in malaysia.

there is a mulitude of information on savings rates and what accs.you are taxed on in this forum.

if you dont live here say goodbye to 15%.of the interest big boy.

To be perfectly honest mate , I'd hardly call a couple of million baht "Playing with the big boys" It a time deposit you clown not a Hedge fund

It'll cost me a few quid but nothing I'll lose sleep over, Just wondered for what and why i was paying Tax

it was you that quoted i have put a few " large boys"

and calling people clowns,gee-wiz your goner go along way in thailand.

Edited October 25, 2014 by meatboy

ExPratt · October 25, 2014

I use this method to circumvent the 15% withholding tax with my several "big boys" accounts

at Krug Sri bank ( bank of Audhaya)

I have my funds divided to several deposit accounts books, each with different account number,

witch bear 2.5 % interests ON CALL,

the trick is to close those accounts when the interests acuminated to just under B. 20,000 whereby

you close and re open same accounts under a different numbers, and thus never pay any tax,

you can repeat it as many time as you like, and have as many account as you like,

ask your informed person at the your local Krung Sri Sri bank...

Hahaha Brilliant , Thanks for the suggestion ,

I may transfer the dough back to Malaysia, I decide to keep more money here as if anything happens to me it will be easier for the missus to get her hands on if its here rather than Malaysia. Be careful with what you put up on the board mate , some right wrong uns about

ExPratt · October 25, 2014

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I know the UK does it , didn't know many others did. IMO if I do not live here I am not receiving the benefit of paying tax or to be more accurate what I SHOULD be getting for paying tax

didnt do much research did you before playing with the big boys.

not much common sense either taking 2.8% when you can get much more in malaysia.

there is a mulitude of information on savings rates and what accs.you are taxed on in this forum.

if you dont live here say goodbye to 15%.of the interest big boy.

To be perfectly honest mate , I'd hardly call a couple of million baht "Playing with the big boys" It a time deposit you clown not a Hedge fund

It'll cost me a few quid but nothing I'll lose sleep over, Just wondered for what and why i was paying Tax

it was you that quoted i have put a few " large boys"

and calling people clowns,gee-wiz your goner go along way in thailand.

Ok, ok ok ok , Peace

I put "Large Boys" because I didn't want to seem like a self absorbed prick and seem to be boasting about "Millions". And I genuinely thought the bird in the bank was wrong , just says what a sheltered life Ive had in Asia for the last 13 years

Have a good weekend mate

meatboy · October 25, 2014

dont know why you did not get my reply,but why not put the acc.in the wifes name,if she has no other income earned in thailand she can claim it back. once she has registered with the revenue she will get a tax id.no then on maturity get a tax witheld cert.from the bank and claim it back in the tax yr.jan-march.its so easy my wife has done it all for me over the past yrs.i have never set foot there.

even if its only 2million x 2.8% yrly.int.that is still 8,400bht.refund thats nearly 4cases of john kepplers.

she is allowed 150,000bht.tax excempt before she pays any.

tingtongtourist · October 25, 2014

I know the UK does it , didn't know many others did. IMO if I do not live here I am not receiving the benefit of paying tax or to be more accurate what I SHOULD be getting for paying tax

Australia also. Not many know,if you stay away for more than 5 years they call you 'non resident for tax purposes' and you have no tax free allowance. You will pay 35% on every $ earned from australian sources.

If you are not classed as non resident for tax in Thailand they will then want tax on any money you earn in Thailand,even tho you already paid tax on it ..a**holes

ExPratt · October 25, 2014

dont know why you did not get my reply,but why not put the acc.in the wifes name,if she has no other income earned in thailand she can claim it back. once she has registered with the revenue she will get a tax id.no then on maturity get a tax witheld cert.from the bank and claim it back in the tax yr.jan-march.its so easy my wife has done it all for me over the past yrs.i have never set foot there.

even if its only 2million x 2.8% yrly.int.that is still 8,400bht.refund thats nearly 4cases of john kepplers.

she is allowed 150,000bht.tax excempt before she pays any.

Thanks , to be honest I never knew a thing about this , she does pay tax every year on 3 million she has in a time deposit, I found out yesterday, as you say had i have known I would have lumped it in with hers

Soutpeel · October 25, 2014

Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay
What are you talking about? Most countries impose taxes on income. Yes bank interest is considered income. And non-residents are not likely to file tax returns, hence the tax is withheld by the bank.
Non-residents should not receive any tax exemption. Can you imagine if I ( a non UK resident) demanded I not be taxed on my UK investment income and protested that I wouldn't invest in UK if I was going to be taxed there?

If you are a thai tax resident then file a tax return and you may be able to claim the tax or part of it back. Do whatever you want with your money but claiming you're "not getting any benefit of the tax paid" makes you sound like a spoilt brat.

How am I getting any benefit from it , health cover ? , The glorious street lights and Rubbish collection , funding the BiB, you are talking nonsense , your'e one of those people who would stand on his head and shit on the ceiling without question if told to by someone in apparent power

I would answer this by saying ask the non UK citizens/residents who invest money in the UK and have to pay on the earnings from their investments and get nothing in return either ? Same thing, your whinging

dotpoom · October 25, 2014

In Ireland they call it "Dirt Tax".

oneday · October 25, 2014

I'm sure someone has said this, but on the off chance they haven't.

It depends on the type of account you have. Just ask for the one you DO NOT pay taxes on. I had several over the last 3 years with the Green "K" bank and they were tax free accounts. Though I understand there are FIXED INTEREST accounts you do pay taxes on.

Pib · October 25, 2014

I'm sure someone has said this, but on the off chance they haven't.

It depends on the type of account you have. Just ask for the one you DO NOT pay taxes on. I had several over the last 3 years with the Green "K" bank and they were tax free accounts. Though I understand there are FIXED INTEREST accounts you do pay taxes on.

Traditional fixed accounts withhold 15% tax of total interest earned, regardless of interest amount....be it B1,000 interest earned or over Bt20,000 per year. These accounts have penalties if you withdraw any of the money before maturity like losing most (usually not all) of the interest. But there are ways to minimize this interest loss impact by having the fixed account balance broken up into several deposits...that way if you must withdraw some money for an emergency only one one of the deposits (part of the total fixed account balance) will be impacted by the early withdrawal penalty.

But regular saving accounts (which pay much lower interest than fixed accounts) don't withhold any tax until you exceed Bt20,000 annual interest and you can withdraw as many times as desired without an interest penalty.

Then you have some hybrid fixed accounts which are a crossbreed between traditional fixed savings account and regular savings accounts...the hybrid accounts pay less interest than traditional fixed accounts but more than regular savings accounts and you can withdraw X-times per month (i.e., around 2 times) without getting hit with an interest penalty/withdrawal fees...and there is no tax withholding until you exceed Bt20,000 interest earned.

Above is just a general overview and not meant to imply the three categories above cover all the different type of savings products offered by Thai banks....just a variety of savings programs out there and they all have their particular terms & conditions (a.k.a., fine print)--be sure you understand the fine print.

ExPratt · October 25, 2014

I'm sure someone has said this, but on the off chance they haven't.

It depends on the type of account you have. Just ask for the one you DO NOT pay taxes on. I had several over the last 3 years with the Green "K" bank and they were tax free accounts. Though I understand there are FIXED INTEREST accounts you do pay taxes on.

Traditional fixed accounts withhold 15% tax of total interest earned, regardless of interest amount....be it B1,000 interest earned or over Bt20,000 per year. These accounts have penalties if you withdraw any of the money before maturity like losing most (usually not all) of the interest. But there are ways to minimize this interest loss impact by having the fixed account balance broken up into several deposits...that way if you must withdraw some money for an emergency only one one of the deposits (part of the total fixed account balance) will be impacted by the early withdrawal penalty.

But regular saving accounts (which pay much lower interest than fixed accounts) don't withhold any tax until you exceed Bt20,000 annual interest and you can withdraw as many times as desired without an interest penalty.

Then you have some hybrid fixed accounts which are a crossbreed between traditional fixed savings account and regular savings accounts...the hybrid accounts pay less interest than traditional fixed accounts but more than regular savings accounts and you can withdraw X-times per month (i.e., around 2 times) without getting hit with an interest penalty/withdrawal fees...and there is no tax withholding until you exceed Bt20,000 interest earned.

Above is just a general overview and not meant to imply the three categories above cover all the different type of savings products offered by Thai banks....just a variety of savings programs out there and they all have their particular terms & conditions (a.k.a., fine print)--be sure you understand the fine print.

Thanks , I'll look into it as between me and the missus we are paying quite a bit of dough in Taxation

Also thatks to all for advice , even the ones who think I'm a bit of a <deleted> , they might be right about that

dunque · October 25, 2014

Thanks gents , I'll look into it. Strange rules if a non resident cannot get a rebate (I'm in and out on a spousal O) as they are the ones who shouldn't have to pay

What are you talking about? Most countries impose taxes on income. Yes bank interest is considered income. And non-residents are not likely to file tax returns, hence the tax is withheld by the bank.

Non-residents should not receive any tax exemption. Can you imagine if I ( a non UK resident) demanded I not be taxed on my UK investment income and protested that I wouldn't invest in UK if I was going to be taxed there?

If you are a thai tax resident then file a tax return and you may be able to claim the tax or part of it back. Do whatever you want with your money but claiming you're "not getting any benefit of the tax paid" makes you sound like a spoilt brat.

I think less of an 'ex' pratt

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