How To Become Tax Resident In Thailand ?

[frog555]

Hello,

 

1. Can we become a tax resident in Thailand ?

The incomes coming from Hong Kong.

With a visa Non-Immigrant O (child). (eventually Elite Card)

 

2. If it is possible, is the process easy or would I lose all my hair left ?

 

3. Is there other thai taxes (based on the personal incomes from abroad) than the personal income tax ?

 

 

Thank you :)

 

 

 

 

 

[LivinLOS]

You can (and legally should) declare income earnt within the same year and remitted to Thailand.. You will pay Thai income tax on it. 

 

However, you cannot work to obtain that income without a work permit, it must be residual income (stocks, dividends, rental yields, etc). 

 

Its possible, but will be very unusual hence may be difficult (I have been told incorrectly I couldnt pay tax without a work permit) because all you have to do is not remit the money this year, and its not taxed.. How anyone defines which money you own in a bank account is this years dollars and which is last years dollars, please explain to me. 

thailand has many taxes, import, sales, etc.. But as relates to income for residual earnings not work that would I understand be all. This isnt something I went through with so others will report with more clarity. Its the earnings without work and paying tax when you dont really need to pay tax as your not working, where it all gets 'thai'.. 

[frog555]

17 minutes ago, LivinLOS said:

You can (and legally should) declare income earnt within the same year and remitted to Thailand.. You will pay Thai income tax on it. 

 

However, you cannot work to obtain that income without a work permit, it must be residual income (stocks, dividends, rental yields, etc). 

 

Its possible, but will be very unusual hence may be difficult (I have been told incorrectly I couldnt pay tax without a work permit) because all you have to do is not remit the money this year, and its not taxed.. How anyone defines which money you own in a bank account is this years dollars and which is last years dollars, please explain to me. 

thailand has many taxes, import, sales, etc.. But as relates to income for residual earnings not work that would I understand be all. This isnt something I went through with so others will report with more clarity. Its the earnings without work and paying tax when you dont really need to pay tax as your not working, where it all gets 'thai'.. 

 

"because all you have to do is not remit the money this year, and its not taxed.. How anyone defines which money you own in a bank account is this years dollars and which is last years dollars, please explain to me. "

 

I have just read a documentation about this point. 

I find it surprising. It would just need to wait for 1 year and these dividends would not be taxed.

 

The matter for me is that I would prefer to pay the tax in Thailand than in my own country.

 

[LivinLOS]

^^ Yes the laws are made by the wealthy who often have non thai sourced income.. This system means they dont have to contribute. 

 

How is the money earnt ?? 

 

[frog555]

5 minutes ago, LivinLOS said:

^^ Yes the laws are made by the wealthy who often have non thai sourced income.. This system means they dont have to contribute. 

 

How is the money earnt ?? 

 

 

The money is earnt by a offshore company in Hong Kong.

No work in/related to Thailand.

[LivinLOS]

Makes no different where the work is performed.. What your trying to do, despite the evasive answers, is clearly illegal. 

 

To work for an offshore company while in Thailand, and pay Thai Tax you must have a work permit.. Doesnt matter where the company is, where the clients are, etc.. Online work is work.. Get something set up with an umbrella company..

 

Have a word with Ozzi at iglu.in.th but I suspect he wont allow you to self declare (eg set an income from your own offshore company to yourself). Cost is 30% of gross last time I checked. 

Edited January 10, 2017 by LivinLOS

[wordchild]

if the money is earned within an offshore company, and is NOT related to work you perform in Thailand, then you can perfectly legally be both tax resident in Thailand and also with a little bit of planning incur no tax liability (in Thailand) for earnings that you remit into Thailand from the offshore company.

 Say the dividends are   paid to you offshore within calendar year 2017, simply hold these offshore until 1st Jan 2018,  and then remit into Thailand anytime after that date. There will then be no tax liability, in Thailand, and no obligation even to declare it.  There is no obligation to declare because ,as far as Thailand is concerned, its not considered to be income; you are bringing your  capital or savings into country not current earnings.

To be safe best to keep records in case you are ever subject to audit. But if you have no other, Thai sourced, income then this would be highly unlikely. I know a couple of people who keep meticulous records and separate bank accounts for Thai earned  and foreign remitted funds. If you have significant Thai sourced earnings (and  a Thai tax liability) its probably worth doing this, most people I know however are not so careful.

    

Edited January 10, 2017 by wordchild

[Naam]

3 hours ago, LivinLOS said:

How anyone defines which money you own in a bank account is this years dollars and which is last years dollars, please explain to me. 

the definition is clear when you transfer (like me) the amount budgeted for expenses of the current year during the first days of january. as simple as that... assuming of course you have the cash accumulated.

[jojothai]

I understand that if you stay in Thailand more than 6 months in a tax year then you are considered to be resident for tax purposes. As such you will be subject to tax on any earnings in Thailand and earnings remitted from abroad in the same tax year. (as stated by the others). You may also be caught for double taxation if you have already paid tax outside Thailand and there is no treaty governing this with Thailand.

eg UK pension income is considered to be earnings and residents here can be subject to thai tax if remitted in the year earnt.

 

If you become resident and remit money then I think you should make sure that you can account for when it was earnt. As the others have stated, do not remit it in the year earnt.

 

I query the reasoning for wanting to become resident for tax purposes in Thailand.

Is it because you don’t want to be considered resident in Hong Kong and pay tax there?

If you are earning the money in Hong Kong then you need to establish the tax obligations there.

Tax residence in Thailand may not help you avoid paying tax where the money is earnt.

My understanding is that all individuals, whether a resident or non-resident of Hong Kong, are subject to Hong Kong salaries tax on Hong Kong-sourced employment income.

Investment Income is a separate subject that you would need to look at .

Go to the HK gov websites and some of the articles provided online by specialist tax consultants.

 

It is likely to be important for you to figure out the Hong Kong tax situation properly, because you may get complications with your HK offshore bank , etc  when they request the declaration for tax residence under the new Common Reporting Standard - starting  in Hong Kong 2017.

[LivinLOS]

1 hour ago, Naam said:

the definition is clear when you transfer (like me) the amount budgeted for expenses of the current year during the first days of january. as simple as that... assuming of course you have the cash accumulated.

 

So its calendar year, not previous 12 months ?? 

 

I have many different accounts so its easy to put some incoming into one.. While sending any I need from another.. Without co mingling.. But laways used to make me smile at the idea that 'oh no, thats nto the money I made in the last year, those dollars are the ones I made in 98'.. If it all comes from the same account, its not like the computer digits have a date record. 

[Naam]

Just now, LivinLOS said:

So its calendar year, not previous 12 months ?? 

yes

[Morakot]

1 hour ago, LivinLOS said:

 

So its calendar year, not previous 12 months ?? 

 

 

Yes, or more precisely a "tax year" which in Thailand is identical to the calendar year.

[frog555]

Offshore company in HK, no sell in HK, then no tax in HK.

 

I want to take the benefit from HK to Thailand, and pay the tax in Thailand, and become taxe resident in Thailand.

And then not pay the taxe in Europe.

 

(I will be out of Thailand 4 months a year.)

 

I see this case as legal.

[userabcd]

Is income taxable, that which has been remitted to Thailand in the same calendar year as having been earned abroad, if one has been living in Thailand for less than 180 days of the calendar year?

Edited January 10, 2017 by userabcd

[jonw8uk]

8 minutes ago, frog555 said:

Offshore company in HK, no sell in HK, then no tax in HK.

 

I want to take the benefit from HK to Thailand, and pay the tax in Thailand, and become taxe resident in Thailand.

And then not pay the taxe in Europe.

 

(I will be out of Thailand 4 months a year.)

 

I see this case as legal.

 

How to become non resident for tax back home in (France from your username?!) Europe?

 

Do they have a double taxation treaty with Thailand?

Edited January 10, 2017 by jonw8uk
typo

[frog555]

1 hour ago, jojothai said:

 

I query the reasoning for wanting to become resident for tax purposes in Thailand.

 

In case of an offshore company, there is no tax in Hong Kong.

[frog555]

11 minutes ago, jonw8uk said:

 

How to become non resident for tax back home in (France from your username?!) Europe?

 

Do they have have a double taxation treaty with Thailand?

 

Yes there is such a treaty :

http://www.elitax.com/income-tax-treaty-france-thailand/

 

I haven't read it yet.

[Naam]

22 minutes ago, userabcd said:

Is income taxable, that which has been remitted to Thailand in the same calendar year as having been earned abroad, if one has been living in Thailand for less than 180 days of the calendar year?

no.

[jonw8uk]

13 minutes ago, frog555 said:

 

Yes there is such a treaty :

http://www.elitax.com/income-tax-treaty-france-thailand/

 

I haven't read it yet.

 

So, will you be in France for the other 4 months? thus maintaining tax liability there?
I don't see why you seek to pay tax here...Usually with a tax treaty, if the tax rate is less in Thailand, you will still have to pay the rest to the french tax authorities.

If you are not resident for tax in France, and can stay non tax resident in thailand, by not bringing in the money for a year, then being tax free seems possible?

 

My experience is only with UK tax, so apologies if France treats taxation differently :)

Edited January 10, 2017 by jonw8uk

[LivinLOS]

34 minutes ago, Naam said:

no.

If the income was made from working while in Thailand, even if for an offshore company, then it would. 

 

For work done inside the kingdom is taxed from day 1. 

 

The issue here is the OP wants to get tax law benefits while avoiding labour law obligations at the same time. If you want to come here and work, online or off, get a work permit. 

Edited January 10, 2017 by LivinLOS

[frog555]

1 hour ago, jonw8uk said:

 

So, will you be in France for the other 4 months? thus maintaining tax liability there?
I don't see why you seek to pay tax here...Usually with a tax treaty, if the tax rate is less in Thailand, you will still have to pay the rest to the french tax authorities.

If you are not resident for tax in France, and can stay non tax resident in thailand, by not bringing in the money for a year, then being tax free seems possible?

 

My experience is only with UK tax, so apologies if France treats taxation differently :)

 

I think that when you get a tax residence in another country than your own country, you would not pay any tax in your own country (if the incomes don't come from your own country).

That's why some people get a tax residence in Cyprus, Malta, ... or live in HK.

Nevertheless, you make me doubt now.

 

- You are citizen of A.

- You live in B more than 183 days (and has nothing any more in A) then you are tax resident in B.

- You have incomes from C (taxed in C if not offshore)

- Incomes from C will be taxed in B as well. In that case, the treaty (between B and C) enter in action.

 

I think that the matter is where is the tax residence.

The treaty between the country of citizenship and the country of effective residence will define if there is only one tax residence (where the effective residence is) or not.

Then we consider the treaty with the country of residence and the country source of the incomes, to know where to pay the taxes.

 

It is how I understand the things.

 

So UK is different than this logic ?

 

"""

If you are not resident for tax in France, and can stay non tax resident in thailand, by not bringing in the money for a year, then being tax free seems possible?

"""

Maybe it would be possible.

That's what for guys who live in Malta for exemple.

(that would not be my purpose.)

 

The few months out of Thailand would be to visit family in France and trips.

I have nothing in France.

 

Edited January 10, 2017 by frog555

[jonw8uk]

So you need to first determine your tax status in France.  You need to know if visiting for a few months effects that, it would in the UK......

 

For me I'm not resident in the UK for tax, and maintain that by not visiting for more than 30 days in any tax year (there are other things that can effect uk tax status too)

 

So now, wherever I work I pay tax there (or not - middle east for example) and then maintain non taxable status in Thailand by not bringing into the Thailand within a year.

 

where is your business making money? you have tax liabilities there?

[frog555]

24 minutes ago, jonw8uk said:

So you need to first determine your tax status in France.  You need to know if visiting for a few months effects that, it would in the UK......

 

For me I'm not resident in the UK for tax, and maintain that by not visiting for more than 30 days in any tax year (there are other things that can effect uk tax status too)

 

So now, wherever I work I pay tax there (or not - middle east for example) and then maintain non taxable status in Thailand by not bringing into the Thailand within a year.

 

where is your business making money? you have tax liabilities there?

 

In France, in order to be not a fiscak resident :

be in France less than 183 days,

and no wife, no kid, no investment, no work, ... in France.

 

My business makes money all over the world, only few % in France, at distance.

Then it would not be a problem.

 

 

[mahjongguy]

If your country of citizenship needs evidence that you are a tax resident of Thailand, you need only to go to the Department of Revenue here and provide proof that you were in-country for more than 180 days in the previous year. They will provide you with a Tax Identification Number which will serve as your evidence. You need not have income taxable in Thailand.

 

As an example, I know of a Dutch citizen who did exactly that so as to avoid payment for national health insurance.  

[frog555]

15 minutes ago, mahjongguy said:

If your country of citizenship needs evidence that you are a tax resident of Thailand, you need only to go to the Department of Revenue here and provide proof that you were in-country for more than 180 days in the previous year. They will provide you with a Tax Identification Number which will serve as your evidence. You need not have income taxable in Thailand.

 

As an example, I know of a Dutch citizen who did exactly that so as to avoid payment for national health insurance.  

 

Thank you for this information.

 

"You need not have income taxable in Thailand."

Do you mean :

- you don't need to have income taxable in Thailand.

?

(Sorry, my english is much basic)

 

[Naam]

3 hours ago, LivinLOS said:

If you want to come here and work, online or off, get a work permit. 

do you have a work permit for handling your investments online?

[Naam]

3 hours ago, jonw8uk said:

 

So, will you be in France for the other 4 months? thus maintaining tax liability there?
I don't see why you seek to pay tax here...Usually with a tax treaty, if the tax rate is less in Thailand, you will still have to pay the rest to the french tax authorities.

If you are not resident for tax in France, and can stay non tax resident in thailand, by not bringing in the money for a year, then being tax free seems possible?

 

My experience is only with UK tax, so apologies if France treats taxation differently :)

he does not seek to pay taxes here! he seeks to become a tax resident of Thailand and avoid taxes in France as well a in Thailand.

[Naam]

2 hours ago, frog555 said:

If you are not resident for tax in France, and can stay non tax resident in thailand, by not bringing in the money for a year, then being tax free seems possible?

"""

Maybe it would be possible.

not maybe, it is possible!

[Naam]

4 hours ago, frog555 said:

 

Yes there is such a treaty :

http://www.elitax.com/income-tax-treaty-france-thailand/

 

I haven't read it yet.

don't let those without any experience confuse you. your plan being income tax free is workable and legal. there's also no need to worry about any potential hair loss. stay am minimum of 183 days in any calendar year in Thailand and you are automatically a tax resident. however, for the coming CRS (Common Reporting Standard) your bank and/or service provider which handles your offshore company might ask for additional proof. worst case scenario is demanding a TIN (Tax Identification Number). but acquiring a TIN isn't a problem.

[jonw8uk]

37 minutes ago, Naam said:

don't let those without any experience confuse you. your plan being income tax free is workable and legal. there's also no need to worry about any potential hair loss. stay am minimum of 183 days in any calendar year in Thailand and you are automatically a tax resident. however, for the coming CRS (Common Reporting Standard) your bank and/or service provider which handles your offshore company might ask for additional proof. worst case scenario is demanding a TIN (Tax Identification Number). but acquiring a TIN isn't a problem.

 

Of note too, is that Thailand hasnt signed up for CRS.  HSBC asked for my TIN here, but accepted that as they aren't covered by the standard, i dont need to provide it.