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mjakob007

Taxation on expats resident in Thailand

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I am seeking clarity on taxation laws that impact foreigners in thailand.

 

A foreigner who spends more than 6months in thailand during a year is deemed to be a resident in thailand for tax purposes? Which period is considered a year, Is it Jan-dec or apr-mar?

 

if one is resident in thailand, is income earned abroad subjected to tax in Thailand? 

Does that tax exposure change if such income is earned in Isle of Man or jersey?

 

If a resident has paid taxes overseas, does it become taxable when that money is imported to thailand for consumption/living expenses?

 

appreciate to hear from experience of veterans in the country

 

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IOM, Jersey or tibuktoo makes no difference.

 

January to December.

 

As the above post says, 100% correct.

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It also depends from where you are. If you are swedish like me. We have a double-taxation-agreement between our two countries who clearly says that "WHERE YOU EARN YOUR MONEY THAT IS WHERE YOU SHOULD PAY YOUR TAXES"....

 

I.e. my pension is taxable of course in Sweden....

 

glegolo

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Posted (edited)

Just work on the principle that income may be taxed but capital is not. So to avoid any problems with, say interest on bank capital, just have your bank transfer any interest to a separate account from the capital. Then you can transfer to Thailand any amount from the capital account with no fear of avoiding tax because it is not income. This would be espevially important where your bank is offshore with no liability for say UK taxation which would avoid being taxed in Thailand due to double taxation agreements.

Edited by Card

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17 hours ago, glegolo said:

It also depends from where you are. If you are swedish like me. We have a double-taxation-agreement between our two countries who clearly says that "WHERE YOU EARN YOUR MONEY THAT IS WHERE YOU SHOULD PAY YOUR TAXES"....

 

I.e. my pension is taxable of course in Sweden....

 

glegolo

Hi, Australia also has a Double Tax Agreement with Thailand. And I am taxed an extra 5 % in Australia which goes to the Thai Tax Office, through the Aust Tax Office. 
this only applies to personal income, not pensions or superannuation income or company profits/ income.

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Jersey 🇯🇪 does Not enjoy a DTA with Thailand 🇹🇭

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20 hours ago, glegolo said:

It also depends from where you are. If you are swedish like me. We have a double-taxation-agreement between our two countries who clearly says that "WHERE YOU EARN YOUR MONEY THAT IS WHERE YOU SHOULD PAY YOUR TAXES"....

 

I.e. my pension is taxable of course in Sweden....

 

glegolo

Same Same for the UK.

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22 hours ago, mjakob007 said:

A foreigner who spends more than 6months in thailand during a year is deemed to be a resident in thailand for tax purposes? Which period is considered a year, Is it Jan-dec or apr-mar?

 

if one is resident in thailand, is income earned abroad subjected to tax in Thailand? 

Does that tax exposure change if such income is earned in Isle of Man or jersey?

 

If a resident has paid taxes overseas, does it become taxable when that money is imported to thailand for consumption/living expenses?

 

appreciate to hear from experience of veterans in the country

Income year, or tax-year, is 1st January to 31st December, you are tax-resident in the country you stay for 183+ days within any 12-month period.

 

You can find the Thai personal income tax rules here.

You can find a .pdf-booklet with further tax explanations here.

You can find a personal income tax calculator here.

You can find all Thai double taxation agreements here.

 

"...is income earned abroad subjected to tax in Thailand?"

All income earned abroad are subject to Thai income tax, but only if transferred into Thailand the same calendar year (i.e. tax year) as earned. See Double Taxation Agreement (DTA) between Thailand and the state in question where the income originates from for further details, some income might be agreed to be taxed in the state from where the income originates. If the DTA between Thailand and Great Britain and Northern Ireland includes Isle of Man and/or Jersey, the islands are covered by that agreement, otherwise income might be fully income taxable in both States.

 

Foreign income transferred into Thailand later than the calendar year it's earned, is considered as tax free savings. I.e. if a foreign income is earned in November and is transferred in December it's personal income taxable; whilst if the foreign income from November is transferred into Thailand in January, it's considered tax-free savings.

 

"If a resident has paid taxes overseas, does it become taxable when that money is imported to thailand for consumption/living expenses?"
Yes, all foreign income transferred same calendar year as earned are personal income taxable in Thailand. However, you need to check the Double Taxation Agreement (DTA) between the country from where the income originates and Thailand. If there is no DTA the income might be double taxed, i.e. taxed both in country of origin, and in Thailand. If there is a DTA some income might be taxed in the country of origin only, or in Thailand only. An example could be retirement pension, which in principle is personal income taxable in Thailand, but a number of countries might have a DTA where the retirement pension remain income taxable in the other State. Dividends from stock holdings might however be income taxed in Thailand only, mening that the other state cannot tax more than 10 percent of the paid out dividend.

 

I hope this answers you questions...🙂

 

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22 hours ago, topt said:

For taxes Jan-Dec

As long as you remit said income after the year it was earned then currently the Thai revenue people should not bother you. That means if it is paid to your account wherever in December you can remit it to Thailand in January and have no liability.

In practice even if you remitted it during the actual year paid to you the Thai revenue people are not chasing people for tax. Monthly pensions being a classic example.

 

The only real variation is if there is some sort of DTA in place which makes it beneficial to you to pay tax in Thailand and not in your home jurisdiction. Otherwise as the previous poster mentioned no reason to pay anything.

 

There have been plenty of threads about this even recently. Have you looked?

"the Thai revenue people are not chasing people for tax. Monthly pensions being a classic example."

That's not a very good example. Have you heard about "double taxation treaties" between countries? You never pay tax in Thailand if there's a treaty between your home country and Thailand. You pay tax where the pension was earned. 

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5 hours ago, Brickbat said:

Hi, Australia also has a Double Tax Agreement with Thailand. And I am taxed an extra 5 % in Australia which goes to the Thai Tax Office, through the Aust Tax Office. 
this only applies to personal income, not pensions or superannuation income or company profits/ income.

I am a little confused.

 

Are you making your money back in Oz, as you said; And I am taxed an extra 5 % in Australia which goes to the Thai Tax Office, through the Aust Tax Office.

this only applies to personal income, etc, etc, etc.

 

So reading into this further, I would say you are working and earning an income here because incomes worldwide are taxable back in Oz, well so I have heard.

 

I only pay tax back in Oz, where I make some extra coin and I pay nothing here.

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9 minutes ago, Max69xl said:

"the Thai revenue people are not chasing people for tax. Monthly pensions being a classic example."

That's not a very good example. Have you heard about "double taxation treaties" between countries? You never pay tax in Thailand if there's a treaty between your home country and Thailand. You pay tax where the pension was earned. 

Incorrect again - no such thing as never. 

As has been posted on here many times before the UK has no DTA on normal pensions only government - and that does not mean the state pension. 

Since the OP is talking about the Channel Isles/IOM there is a good chance he may be UK non resident which I think makes it a very good example.......

If you had bothered to read my full post instead of trying to pick holes you would see I mention DTAs anyway. 

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On 6/27/2020 at 7:40 PM, mjakob007 said:

A foreigner who spends more than 6months in thailand during a year is deemed to be a resident in thailand for tax purposes?

I believe the correct terminology is a 'non resident' for tax purposes, i.e. on your worldwide income, i.e. regardless if it's your coming from within or outside Thailand, it's anywhere in the world and it goes back to your country of citizenship.

 

On 6/27/2020 at 7:40 PM, mjakob007 said:

if one is resident in thailand, is income earned abroad subjected to tax in Thailand? 

Does that tax exposure change if such income is earned in Isle of Man or jersey?

As you are not a citizen of Thailand I don't see what Thailand has to do with you earning a crust from overseas, although your citizenship country will want the tax on it. 

 

On 6/27/2020 at 7:40 PM, mjakob007 said:

If a resident has paid taxes overseas, does it become taxable when that money is imported to thailand for consumption/living expenses?

I don't see why, after all, you are paying taxes overseas, which your country of citizenship should receive or offset come tax time.

 

An example from my own experience. I am a non resident of Australia, I reside in Thailand, have done for the past 4.5 years, I make some money within Australia from here, doing some consultancy work from time to time, I send the report via email in a PDF file attachment to the client, the funds are paid into my Australian bank account. I pay tax in Australia as a non resident, i.e. 32c in the $, nothing to Thailand. I transfer money to Thailand to live on a couple of times a year at the most, however mostly once in a lump sum.

 

Also there are other benefits for 'non residents' who invest their savings in the stock market in Australia, as the stocks purchased don't have tax payable on them when you sell them for a gain, e.g. no capital gains tax, or no tax paid when you receive your dividend payment from the shares you hold, however if your shares aren't fully franked, i.e. they don't withhold the tax when paying you, then you have to pay that tax when tax time comes around.

 

Other countries might have a similar set up ?

 

But my take on your questions are no, zero, nothing, but always best to do your own research on Google relating to your country's tax system and or talk to an accountant.

 

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It is actually quiet easy,

 

You pay tax in thailand as well in the country where your world income does fall according to the rules.

Since most have a non-immigrant visa the world income falls in yhe country they last had registered thir domicilie.

 

Depending on the economic treaties between countries you can deduct the income tax paid in thailand from the income tax to be paid at the country your world income falls.

 

If this is not the case then you have to pay tax again over the income and assets (house, car and so on) that you already had paid tax over.

 

 

The games is simple and the revenue department always wins.

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