Taxes on retirement Pension from abroad

[soundtrack]

Can anybody help me ?

In case i ask my Country in Europ to pay my pension in Thailand how much do i have to pay for this revenue here in my new residence in Thai?

The taxes in my Country are about 30%. They will be cancelled due to an agreement between the two Countries on the groung of double taxation.

I appreciate any help you can give me

[ubonjoe]

Moved to the business forum

[Soutpeel]

if your being taxed in your own country at source you will not be taxed in Thailand

if you do register for tax in Thailand the top tax rate is 35% for amounts above +/- USD 125,000 p.a.

[Naam]

if you can get rid of your home country's tax on your retirement payments then you don't have to worry about Thai income tax. no retiree pays any income tax in Thailand. that applies to his retirement entitlements from abroad as well to potential additional investment income outside Thailand.

[JAS21]

The taxes in my Country are about 30%. They will be cancelled due to an agreement between the two Countries on the groung of double taxation.

That is not the case in the UK ... are you absolutely sure that is the case in your country ... I am a little surprised. There has been a lot of discussion on TV recently concerning the UK .. if I understood correctly if you remit income to Thailand in the year that that you earn it then you could pay two lots of tax ... I'm sure someone will enlighten me on this. Pension money may be treated differently.

[soundtrack]

That is not the case in the UK ... are you absolutely sure that is the case in your country ... I am a little surprised. There has been a lot of discussion on TV recently concerning the UK .. if I understood correctly if you remit income to Thailand in the year that that you earn it then you could pay two lots of tax ... I'm sure someone will enlighten me on this. Pension money may be treated differently.

I asked my Consulate and I was told that I can avoid tax payment in my Country only if i present a document certifying that I asked to be enlisted in Thailand fiscal office and I will pay the due taxes here .

[Torrens54]

if you can get rid of your home country's tax on your retirement payments then you don't have to worry about Thai income tax. no retiree pays any income tax in Thailand. that applies to his retirement entitlements from abroad as well to potential additional investment income outside Thailand.

Just a crazy thought... What if you "declared" your Overseas Pension as "Income" and in fact, paid Tax here in Thailand on it, would it be a way of gaining access to Thai Medical/Hospital coverage?

[soundtrack]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

if you can get rid of your home country's tax on your retirement payments then you don't have to worry about Thai income tax. no retiree pays any income tax in Thailand. that applies to his retirement entitlements from abroad as well to potential additional investment income outside Thailand.

Just a crazy thought... What if you "declared" your Overseas Pension as "Income" and in fact, paid Tax here in Thailand on it, would it be a way of gaining access to Thai Medical/Hospital coverage?

I do not know and I doubt that Thais have a Medical coverage as we intend it

[Naam]

if you can get rid of your home country's tax on your retirement payments then you don't have to worry about Thai income tax. no retiree pays any income tax in Thailand. that applies to his retirement entitlements from abroad as well to potential additional investment income outside Thailand.

Just a crazy thought... What if you "declared" your Overseas Pension as "Income" and in fact, paid Tax here in Thailand on it, would it be a way of gaining access to Thai Medical/Hospital coverage?

your thought is not crazy but based on logic. unfortunately paying income tax in Thailand does not entitle you to any Thai government medical care.

[Naam]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

if you can get rid of your home country's tax on your retirement payments then you don't have to worry about Thai income tax. no retiree pays any income tax in Thailand. that applies to his retirement entitlements from abroad as well to potential additional investment income outside Thailand.

Just a crazy thought... What if you "declared" your Overseas Pension as "Income" and in fact, paid Tax here in Thailand on it, would it be a way of gaining access to Thai Medical/Hospital coverage?

I do not know and I doubt that Thais have a Medical coverage as we intend it

[Soutpeel]

That is not the case in the UK ... are you absolutely sure that is the case in your country ... I am a little surprised. There has been a lot of discussion on TV recently concerning the UK .. if I understood correctly if you remit income to Thailand in the year that that you earn it then you could pay two lots of tax ... I'm sure someone will enlighten me on this. Pension money may be treated differently.

I asked my Consulate and I was told that I can avoid tax payment in my Country only if i present a document certifying that I asked to be enlisted in Thailand fiscal office and I will pay the due taxes here .

if there are reciprocal tax agreements in place you will not pay tax twice on the same money, therefore if you pay tax on the money in your country and remit the same your year are not required to pay tax in Thailand

this is exactly what your consulate is telling you in a round about way, if you don't want to pay tax in your own country on your pension then you need to register as a tax payer in Thailand and you can pay your tax there, but you need to prove your paying the tax

[AyG]

OP, it would be helpful if you were to name the country paying your pension. Also, is it a private pension? Or is it a state pension (i.e. paid by the government)? Otherwise answers will just be speculative.

[changnaam]

I believe that if you remit the funds to thailand in the following year you will not be liable for tax in thailand. For example if you hold a guernsey pension which pays gross ( no tax) but don't send the funds until the following year to thailand then they are free of tax.

I have never heard of anyone having to pay thai income tax on pension but as far as rules go I think they should be taxed if sent in same year, and not taxed elsewhere.

[JimGant]

I have never heard of anyone having to pay thai income tax on pension but as far as rules go I think they should be taxed if sent in same year, and not taxed elsewhere.

Thai tax authorities would have too hard a time discerning whether or not a personal wire transfer into Thailand contained 'this year's earnings,' or 'last year's earnings' -- or no earnings at all, just a draw down of your savings account. So, they just ignore any money coming in from abroad.

However, some folks have their pensions direct debited to their Thai bank -- a prima facie case that those are this year's earnings. If Thai tax authorities were clever -- big assumption -- they'd identify these funds and have banks slap a percentage withholding on them (just as banks now do with fixed investment accounts). Then, it's up to you to sort this out with the bank and/or tax authorities by waving the double taxation treaty -- if it's applicable to your situation. Better yet, don't direct debit, but have a middleman bank in your homeland to launder, er, filter your pension. Certainly no reason now to do anything -- except to keep such a scenario in mind.

Awhile back there was a thread that discussed the dropping of the 'not in the same year' escape clause from some recent Thai legislation. That seemed to have been shot down, as I've seen no more discussion on this.

But the Thais sure could subject a lot more income to taxation, if, indeed, they eliminated this clause. Yes, the private wire transfer could still be explained away as a savings account drawdown (but maybe, then, you'd have to prove it). And for Brits and Yanks, any government pension is protected from Thai taxation by treaty (but not private pensions or annuities). Still, I hate the idea of proving source of funds to avoid any withholding by the bank -- or the subsequent goatrope of getting a refund.

But what's curious is the FATCA agreement between Thailand and the US: It's reciprocal, meaning Thailand will begin to receive from the IRS information on earnings in the US by its citizens. But this information is worthless if these earning aren't direct deposited into Thailand, as the Thais will sidestep this by claiming it's last year's earnings being sent. And if correctly set up, Thai tax authorities won't be able to disprove this-----

------ but if they drop the 'not in the same year' clause from the law, what a nice new source of tax revenue.

Maybe then we'll see no more talk about a property tax.

[gk10002000]

This thread brings up a question I had not considered before. If I retire in Thailand, retirement extension visa thingy, do I have to file any tax paperwork with Thailand? All my investment and income money comes from the USA and is based there. I know what the USA IRS will do, but I had not thought Thailand would care or need to know anything except what I certify on my income qualification affidavit from the USA embassy.

[Soutpeel]

This thread brings up a question I had not considered before. If I retire in Thailand, retirement extension visa thingy, do I have to file any tax paperwork with Thailand? All my investment and income money comes from the USA and is based there. I know what the USA IRS will do, but I had not thought Thailand would care or need to know anything except what I certify on my income qualification affidavit from the USA embassy.

here is a simplest answer..if your "resident" in Thailand for more than 180 days per year your resident for tax purposes, ergo if they really pushed the law in Thailand, which we know they don't, you should be submitting a tax return in Thailand, whether you owe them anything is a secondary question.

like the road rules and helmet laws in Thailand compliance with the income tax rules appears to be optional and not enforced, not saying it will not be in the future.

Edited March 19, 2015 by Soutpeel

[Naam]

This thread brings up a question I had not considered before. If I retire in Thailand, retirement extension visa thingy, do I have to file any tax paperwork with Thailand? All my investment and income money comes from the USA and is based there. I know what the USA IRS will do, but I had not thought Thailand would care or need to know anything except what I certify on my income qualification affidavit from the USA embassy.

you don't have to do anything. period!

[JAS21]

Well I wish that I could get out of paying tax in the UK (pensions and house rental) and pay it here instead ... I would be somewhat better off. Today I went to claim back my with holding tax. Had to wait all of 5 minutes to be seen. The kind lady filled in my form for me ... took about 10 minutes ... and I was out of there.

This year all she wanted was the certificates showing the Interest and the Tax paid, along with my Tax ID. No passport. Yellow book etc. I had received the tax form through the post earlier this year.

[billd766]

Well I wish that I could get out of paying tax in the UK (pensions and house rental) and pay it here instead ... I would be somewhat better off. Today I went to claim back my with holding tax. Had to wait all of 5 minutes to be seen. The kind lady filled in my form for me ... took about 10 minutes ... and I was out of there.

This year all she wanted was the certificates showing the Interest and the Tax paid, along with my Tax ID. No passport. Yellow book etc. I had received the tax form through the post earlier this year.

The problem with HMRC in the UK is that they deem ANY income earned in the UK is subject to UK income tax, pensions included once you get past the tax threshold and they are like the British Bulldog of the past. Once they get their teeth into you they just won't let go.

Having said that I had a problem with my UK tax coding this week so I called the HMRC self employed tax people up in Scotland and the call was answered inside 2 minutes. I explained the problem and the lady looked up my tax return, identified the problem and fixed it for me. She also found a couple of other minor pension problems and fixed them too. They are a very nice bunch of people.

My big problem when I hung up was eating the double portion of humble pie as the problem was of my own making but I did learn that

1. I MUST check and recheck my tax return every time.

2. Once you send that return in HMRC don't check it so if you screw up as I did it will be YOUR fault as it was mine.

[prakhonchai nick]

It is not just us farangs that receive pensions from overseas. There are many Thai widows here, who receive pensions from their former husbands occupational pension schemes. Payments from the UK DWP for Bereavement Benefits, Widowed parents Allownace etc are not taxed at source, but invariably UK occupational pensions are, and at 20% on the full amount. No personal allowances given.

It is possible to claim using a double taxation agreement, but on the Foreign pensions, Thai tax can quickly add up, and the saving paying Thai tax is often very small. Add to that the extreme complications in having Thai widows deal with the Thailand revenue department, and it is probably better to just pay the UK 20% tax.

[topt]

It is not just us farangs that receive pensions from overseas. There are many Thai widows here, who receive pensions from their former husbands occupational pension schemes. Payments from the UK DWP for Bereavement Benefits, Widowed parents Allownace etc are not taxed at source, but invariably UK occupational pensions are, and at 20% on the full amount. No personal allowances given.

It is possible to claim using a double taxation agreement, but on the Foreign pensions, Thai tax can quickly add up, and the saving paying Thai tax is often very small. Add to that the extreme complications in having Thai widows deal with the Thailand revenue department, and it is probably better to just pay the UK 20% tax.

This came up in another thread and there was a reference to the double taxation agreement document. From memory there is no double tax agreement for UK pensions other than some govt. (as in civil service/armed forces or similar) so most would have no choice anyhow. I will try and see if I can find it just in case I have remembered incorrectly.

Edit - see here https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/356800/Digest_of_Double_Taxation_Treaties.pdf bottom of page 37 note 4.

[prakhonchai nick]

It is not just us farangs that receive pensions from overseas. There are many Thai widows here, who receive pensions from their former husbands occupational pension schemes. Payments from the UK DWP for Bereavement Benefits, Widowed parents Allownace etc are not taxed at source, but invariably UK occupational pensions are, and at 20% on the full amount. No personal allowances given.

It is possible to claim using a double taxation agreement, but on the Foreign pensions, Thai tax can quickly add up, and the saving paying Thai tax is often very small. Add to that the extreme complications in having Thai widows deal with the Thailand revenue department, and it is probably better to just pay the UK 20% tax.

This came up in another thread and there was a reference to the double taxation agreement document. From memory there is no double tax agreement for UK pensions other than some govt. (as in civil service/armed forces or similar) so most would have no choice anyhow. I will try and see if I can find it just in case I have remembered incorrectly.

Edit - see here https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/356800/Digest_of_Double_Taxation_Treaties.pdf bottom of page 37 note 4.

Many Thai widows, have until quite recently been given the Personal Allowance of circa £10,000. which has in effect meant they paid no tax on their widows pensions.

Now the IR require confirmation from the Thai tax authorities that they are aware of the pensions, and will tax them in Thailand, if the UK are to give a tax refund.

[coppywriter]

So, at the end of the day, do we need to pay Thai tax on UK pensions (government/private) that are paid into a UK bank? and only drawn down by an ATM transaction, I am still a bit confused, sorry.....

[orientalist]

Here's what the Revenue Dept says:

" 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

 

In practice, the tax people don't hassle foreigners on retirement visas. They might, however, if you claim a big tax refund on Thai bank withholding tax. Then the onus would be on you to prove you can live here without recourse to foreign funds. There is a topic on this somewhere. I think it is very, very unlikely that you'll have problems importing funds via ATM.

[meatboy]

On 27/2/2560 at 5:39 PM, coppywriter said:

So, at the end of the day, do we need to pay Thai tax on UK pensions (government/private) that are paid into a UK bank? and only drawn down by an ATM transaction, I am still a bit confused, sorry.....

uk.gov./private pensions paid through your uk.bank are subject to tax after your personel allowance.

i have the same paid in the uk.and i transfer my yearly exs.from the uk.to thailand once a yr.there is no tax taken in thailand on income from the uk.

now i have many thai.bank accounts [fixed] that tax is witheld by the thai bank,but at the end of the tax yr,dec31st.i can claim a refund on all interest witheld up to my thai personel allowance which is 190,000bht.all interest over that amount is as per.ratio.

tax.web.WWW.RD.GO.THY