Able To Claim Back Thai Income Tax?

[1Lucky]

A friend of mine recently told me that there was some taxation agreement between thailand and the UK which meant if you worked in thailand for a couple of years you don't have to pay thai tax for those years/can claim it back.

Is this true and if so (a) what are the conditions that apply and ( how do you go about claiming it back?

If this is true I will be extremely grateful for your replies.

Best Xmas wishes to all.

Lucky

[Maestro]

You’ve got to pay income tax somewhere. The bilateral taxation agreement is to avoid double taxation: if you get taxed in both countries, you can claim back the tax of one country.

Example: you are a tax-paying resident in Thailand, have a savings account in the UK, have tax on your UK interest withheld in the UK, declare this interest as income on your Thai tax declaration. Now you can claim back the tax withheld in the UK.

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Maestro

[1Lucky]

That's not how my teacher friend explained it. Basically he reckoned a number of teachers at an international school have been able to claim back all their thai tax - they're not paying it in the UK as they're only working and living here. Sounds a bit unlikely to me but if it were true it would be an excellent xmas present.

Lucky

[lanny]

I don't know what the tax treaty with the UK says but the US treaty has a provision like this. If, and this is the key, if you are a teacher, you do not have to pay Thai income taxes for the first two years in Thailand. There is some paperwork required for this but is not difficult.

Basically, you have to give the Thai tax authorities a statement that you are still a resident in the US, for tax purposes. This includes a document you get from the IRS. The downside to this is that it prevents you from claiming the foreign tax credit on the basis of bona fide residency. You must qualify under the physical presence rule, which means you cannot go back to the states for two or three months during the summer break.

[astral]

A copy of the Dual Tax Treaty is available from HM Stationery Office.