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ubonr1971

Repayment of loan to my bank account over several yrs. Do I need to pay tax?

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The wife and I invested money in a business and its been successful to date. Years ago we decided to invest half the funds each and I lent her the shortfall of funds as she didnt have enough at the time. The business is in her name and I dont work at all and dont have a WP. At the time of establishing the business we decided to arrange a simple loan contract. I thought I could fall back on this if questioned by authorities (immig/ labour dept) about the money being credited to my account (ie loan repayments from her). 

 

But now I thinking perhaps I should declare this on my tax return somehow. I dont want to be caught up in money laundering B.S. Im now getting large monthly deposits from her and dont want any red flags raised

 

I dont want to report it as 'income' bc then that implies that Im working. Im confused about what to do here. I thought I would ask here before referring to my tin pot accountant. 

 

Can I safely assume that databases from the tax office and immig/ labour dept are not linked?

 

thanks

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The rent on the loan is income and taxable.

Does she only pay back the loan or parts of the profit of the company? Does she own all the shares or do you have some? 

 

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You can declare the income and pay taxes on it if you want to. You would first need to get a tax ID number. If by chance you have a yellow house book the ID number on it would be used.

No problem with any authority for doing it.

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2 hours ago, ubonjoe said:

You can declare the income and pay taxes on it if you want to. You would first need to get a tax ID number. If by chance you have a yellow house book the ID number on it would be used.

No problem with any authority for doing it.

I have a tax id already when I was doing the 30k a month teaching gig. 

 

I dont really want to declare it and pay taxes. I wish I knew if I technically have to or not... They are quite large monthly credits every month so maybe I should...

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7 hours ago, ubonr1971 said:

I dont want to report it as 'income' bc then that implies that Im working.

Working and receiving income are very different. You can own a company or part of a company (as you do) in Thailand without working there and I suggest you speak to an accountant.

 

Many people earn interest on investments, dividends, etc. It's taxable but doesn't require a work permit. Only the actual working requires a work permit.

 

I do understand your hesitance as you're opening yourself up to extra scrutiny from those who are most definitely 'out to get you' but if you're really not working at all then you have nothing to worry about.

 

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There is a difference between a return of capital and income. If the money received is a genuine loan repayment, and you can show this, then it is not income and therefore not taxable. IMO.

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3 hours ago, DoctorG said:

There is a difference between a return of capital and income. If the money received is a genuine loan repayment, and you can show this, then it is not income and therefore not taxable. IMO.

I agree with your comment. I have an executed loan contract witnessed by an attorney in thailand. I suppose I will show it to my accountant and see what she says. cheers

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Is the loan money tax paid ? Didyou earn it in Thailand or bring it in from offshore ?

Dividends are a different story. They are taxable but in saying that if you make a contract on the loan & include interest on the loan (up to 18% per annum) this would help reduce the tax liability.

Anything returned above the actual loan amount is taxable.

The tax department here will treat you fairly & will even help you claim any tax deductions

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If you have no other taxable income in Thailand, and the interest – which as posters have said it, is the taxable part – is under the income tax limit; you don't need to declare the income.

 

The official homepage for Thai income tax is here, and the is a personal income tax calculator here.

 

You don't need a Work Permit to obtain an income, if the income don't originate from work.

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