Withholding tax on bank account

[GreasyFingers]

Interest was paid into my Kaskorn bank account in December but they also deducted a Withholding tax. This is the first year that it has happened and the bank has advised me that:

1. they cannot reimburse the tax, and

2. that it cannot be recovered from the Tax Office.

I had previously been advised by the bank (in reply to an email) that tax is only withheld where the amount of interest is THB20,000 or over. The bank call center says the tax is levied on all interest on all farang accounts. My interest was about THB13,000 and the tax withheld THB1900. Not a large amount but would cover beer for a few days.

 

If what I have been told there are thousands of farangs being hit with this tax. As I said earlier it has not happened in the 4 previous years. Can anyone advise if it can be recovered.

 

I am on a retirement extension so no work permit or other income to interest the Tax office.

 

 

[johng]

  On 2/7/2017 at 7:20 AM, GreasyFingers said:

1. they cannot reimburse the tax, and

2. that it cannot be recovered from the Tax Office.

Expand  

1 no they can't

2 I'm sure you could

3 I think someone made "a balls up" at your branch  but they don't want to admit it.

[ubonjoe]

You can claim a refund of the taxes deducted at the local Thai revenue department office. You would first have to apply for a tax ID number. Then file a tax return to get the refund. You can find info here. http://www.rd.go.th/publish/6045.0.html

[meatboy]

this is a right balls up by some incompetant staff, i have never ever paid tax other than on deposit/fixed accs.

ask the bank to give you a certificate showing the tax witheld,if they wont phone head office.

if you get the certificate then you will get all you need to know,on here.

[KhunBENQ]

  On 2/7/2017 at 8:47 AM, meatboy said:

i have never ever paid tax other than on deposit/fixed accs.

Expand  

And that seems to be the point.

I just went through 12 old(void) fixed deposit account books: all interest taxed.

I have four old normal savings account: no tax entries found.

 

The OP does not detail what accounts this is about.

 

And sure the withholding tax will be reimbursed by the tax office.

 

  On 2/7/2017 at 7:20 AM, GreasyFingers said:

I had previously been advised by the bank (in reply to an email) that tax is only withheld where the amount of interest is THB20,000 or over. The bank call center says the tax is levied on all interest on all farang accounts.

Expand  

Strange information. Does not fit any of my observations.

(although I never had more than 20000 interest on a normal savings account).

 

[GreasyFingers]

  On 2/7/2017 at 8:52 AM, KhunBENQ said:

The OP does not detail what accounts this is about.

Expand  

Just a normal savings account

[GreasyFingers]

  On 2/7/2017 at 8:17 AM, ubonjoe said:

You can claim a refund of the taxes deducted at the local Thai revenue department office. You would first have to apply for a tax ID number. Then file a tax return to get the refund. You can find info here. http://www.rd.go.th/publish/6045.0.html

Expand  

Could be a lot of trouble to go to as I am not sure how to interperate the section on Interest, typical tax talk. Will have to decide how thirsty I will be.

[Pib]

A traditional Fixed saving accounts is taxed at 15% regardless of the amount of interest earned.  Earn Bt1K in interest and your tax is Bt150.  Earn Bt100K in interest and your tax is Bt15K.   Etc....etc....etc.  

 

By fixed savings account that you are talking a fixed interest period of 3 months, 5 months, 9 months, 12 months, etc......just whatever period that fixed account is for.   I too have always paid 15% tax on the half dozen or so fixed savings accounts I have had.  And I have claimed/received a full refund at my local tax revenue office....no problem.

 

Now "regular savings" accounts are not taxed "until" they exceed Bt20K per year interest earned.    Once again, you can obtain a refund by applying for it at your local tax revenue office during the Jan-Mar yearly tax return/refund filing period.

 

And I'm not sure about this at all, but for a "regular" savings account if you earn "over Bt10K per 6 months" (i.e., the mid year interest payment), the bank will assume you will also earn over Bt10K interest during the second half/end of year interest payment which means you will earn over Bt20K interest per year.  Instead of hitting you with an tax payment covering the whole year, they instead hit you twice  a year during the interest payment time.

[GreasyFingers]

  On 2/7/2017 at 1:02 PM, Pib said:

Now "regular savings" accounts are not taxed "until" they exceed Bt20K per year interest earned.    Once again, you can obtain a refund by applying for it at your local tax revenue office during the Jan-Mar yearly tax return/refund filing period.

Expand  

Is it a difficult process to claim the refund if you do not have a tax ID and know nothing about the tax system here.

[chiang mai]

  On 2/8/2017 at 12:47 AM, GreasyFingers said:

Is it a difficult process to claim the refund if you do not have a tax ID and know nothing about the tax system here.

Expand  

Not true, it's very simple.

 

Take your passport and visit the tax office and ask for a tax ID, they will check to ensure you are indeed tax resident here by spending more than 183 days per year in Thailand. Fifteen minutes and a cup of free coffee later you will have your tax ID.

 

To obtain a tax refund: obtain letter of tax paid from bank, after 1 January each year,.

 

Visit tax office and tell them you want to file a tax return to reclaim tax paid on bank accounts - 10 minutes of simple form filling which they may well do for you and you're all done.

 

Wait for cheque in the post four weeks later.

 

 

[GreasyFingers]

  On 2/8/2017 at 12:57 AM, chiang mai said:

Not true, it's very simple.

 

Take your passport and visit the tax office and ask for a tax ID, they will check to ensure you are indeed tax resident here by spending more than 183 days per year in Thailand. Fifteen minutes and a cup of free coffee later you will have your tax ID.

 

To obtain a tax refund: obtain letter of tax paid from bank, after 1 January each year,.

 

Visit tax office and tell them you want to file a tax return to reclaim tax paid on bank accounts - 10 minutes of simple form filling which they may well do for you and you're all done.

 

Wait for cheque in the post four weeks later.

 

 

Expand  

Thanks mate, will do.

[Pib]

As already said by chiang mai, obtaining a tax ID/refund is an easy process.  

 

See below TV thread talking the process by many different people.   I found my local tax office to be extremely helpful.....basically filled out the forms for me....I just had to sign....always got my full refund over the next month or so.  

 

 

[meatboy]

  On 2/8/2017 at 1:00 AM, GreasyFingers said:

Thanks mate, will do.

Expand  

as its been said very easy,just in case a TIN.is mentioned its your TAX ID.NO. 13no's.

and dont forget go to your bank and ask for the TAX WITHELD CERTIFICATE.

[rak sa_ngop]

Think carefully before going ahead with a tax rebate.

 

Call me ultra-cautionary but I have decided to forgo a 3,000 baht withholding tax claim just to stay under the radar.

 

One of my UK investment companies asked me for my tax number in 'the country of my residence' and I replied 'none, as I have no taxable income in Thailand'.

 

So far so good!

 

 

[chiang mai]

  On 2/8/2017 at 6:05 AM, rak sa_ngop said:

Think carefully before going ahead with a tax rebate.

 

Call me ultra-cautionary but I have decided to forgo a 3,000 baht withholding tax claim just to stay under the radar.

 

One of my UK investment companies asked me for my tax number in 'the country of my residence' and I replied 'none, as I have no taxable income in Thailand'.

 

So far so good!

 

 

Expand  

The purpose of that request was to prove your tax residency, not to set you up to be taxed etc.

[rak sa_ngop]

  On 2/8/2017 at 6:10 AM, chiang mai said:

The purpose of that request was to prove your tax residency, not to set you up to be taxed etc.

Expand  

Yes, but that information supplied to the UK can now be shared around the world.

 

And anybody residing in Thailand for more than 6 months a year is considered to be 'a tax resident'.

 

Who knows what will happen in the future in LOS with respect to foreign income (profits, interest and dividends).

 

I am happy in my decision.

[lkn]

  On 2/8/2017 at 12:57 AM, chiang mai said:

Take your passport and visit the tax office and ask for a tax ID, they will check to ensure you are indeed tax resident here by spending more than 183 days per year in Thailand. Fifteen minutes and a cup of free coffee later you will have your tax ID.

Expand  

Does that mean that you cannot get a tax ID if you stay less than 183 days, and have to forego reclaiming the withholding tax?

 

 

[chiang mai]

  On 2/8/2017 at 8:09 AM, lkn said:

Does that mean that you cannot get a tax ID if you stay less than 183 days, and have to forego reclaiming the withholding tax?

 

 

Expand  

You cannot be tax resident if you stay here less than 183 days per year, whether or not you can get a tax ID is a different matter, and I don't know if you can but I doubt it unless you are say a non-resident  business owner who owes tax.

[topt]

  On 2/8/2017 at 12:57 AM, chiang mai said:

Not true, it's very simple.

 

Take your passport and visit the tax office and ask for a tax ID, they will check to ensure you are indeed tax resident here by spending more than 183 days per year in Thailand. Fifteen minutes and a cup of free coffee later you will have your tax ID.

 

To obtain a tax refund: obtain letter of tax paid from bank, after 1 January each year,.

 

Visit tax office and tell them you want to file a tax return to reclaim tax paid on bank accounts - 10 minutes of simple form filling which they may well do for you and you're all done.

 

Wait for cheque in the post four weeks later.

 

 

Expand  

I don't want to put the OP off but depending on his local tax office (and language competency) it may take him a little longer than that - especially if he leaves it until closer to the end of March when all the locals may be trying to close off their tax obligations. This I found from my original experience but it would have been easier had I known the correct office to start with. Once there I remember having to wait several hours.

 

If he is going to claim for last year I would strongly suggest taking action as soon as possible.

[orientalist]

My experience is that it takes a few weeks if I file early in January but 2-3 months if I file in March, when they are busier. Also, they require a copy of all your passport pages, presumably (I could never get a consistent answer on this) to check whether you are in fact tax resident in Thailand and entitled to claim a refund. I was never asked for this by the front-office staff who helped me fill in the return, but I would get an official letter 2 weeks later - all in Thai - requesting me to send passport copy and other documents by fax. The small text at the bottom of this letter says that if you don't provide the requested documents within X weeks they will take appropriate action (i.e. bin your refund).