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is transfer of money to support Thai wife subjected to income tax?


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I am staying on non IMM "O" yearly extension based on marriage.

Since several years I make therefore monthly transfers of minimum 40.000 Baht/month to my account here in Thailand

My Thai wife made exceptionally some money and she declared this to-day to the Thai tax authorities

Now the Thai tax authorities warned my wife that this is "income" and therefore I am subjected to tax...

My pension is already taxed in my home country and there is a treaty with Thailand to avoid double taxation.

What is the experience of other TVF members making money transfers to comply with Immigration Laws?

What if 2 months before applying for extension I deposit 400.000 Baht in my account : is this then also taxable income?

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I find it would be absolutely weird that they would think that transfers between married persons should be taxable!

 

I would try and make sure transfers to Thailand were not income in any case.

 

They have already come up with compulsory insurance, that does not insure, for Visas. I hope this is not the next mutation! 🙂

 

 

(I avoided being in Thailand more than the 180 days in 2018 when taking some Pensions (UK), as I thought it would be just to complicated to explain if required in Thailand. This however gave me about 5 years worth of Legitimate funds I could demonstrate against ongoing transfers to Thailand, as savings.

 

My intention was to remain UK tax resident,  whilst in discussion with HMRC on this subject, I asked about my pensions, that looking at the UK/TH Tax treaty, as they were pensions from Government Service, were covered under the treaty (1981 from memory). They advised that sometimes tax authorities require the tax to be paid, and then it should be refund immediately as it is covered under the treaty. The wording in the UK treaty is a bit vague about other pensions, compared with the US treaty which last time I looked was crystal clear that pensions were not taxable.

 

So as a plan, to avoid any future complications, assuming fortunate to have at least a years TH budget in Home country...

 

Not to transfer to Thailand from the account  that I receive current in year income remitted to in home country.  (That bank is very poor for doing SWIFT anyway)

Only show proof of income source from the previous year(s), or earlier.

Transfers come from savings, any "income" is purely in home country.

 

When I was practicing transfers to Thailand, I sent by SWIFT the amount of a pension from 12 months previously, though no direct link, but thought it may be easier to demonstrate source if called for in the future, for the 40k/month)  

 

I always wondered if I get the lottery up would I have to wait till the following January to send the wife's half 🙂. Just in case.

 

 

 

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17 hours ago, Tanoshi said:

Double taxation reciprocal agreements mean you don't pay tax in Thailand on your already taxed income.

Not necessarily. For example most (not all) UK pensions do not fall under the DTA. 

Depends on each country.

@UKresonant already mentions this above

Edited by topt
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1 hour ago, topt said:

Not necessarily. For example most (not all) UK pensions do not fall under the DTA. 

Depends on each country.

@UKresonant already mentions this above

He's referring to the often misunderstood requirement to pay tax in Thailand after becoming resident for tax purposes after 180 days. That only applies to nationalities who's Country do not have a dual taxation reciprocal agreement with Thailand. 

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33 minutes ago, Tanoshi said:

He's referring to the often misunderstood requirement to pay tax in Thailand after becoming resident for tax purposes after 180 days. That only applies to nationalities who's Country do not have a dual taxation reciprocal agreement with Thailand. 

Read his comment again specifically regarding treatment of pensions. I was replying to your comment which is not 100% accurate and basically he was saying similar.

Perhaps I should have added that in practice it is not currently actioned by the Thai Revenue but it theoretically could be - if they could prove it was current calendar year income which would in many cases be impossible. And before anybody chips in yes I know it will be on the individual to prove the opposite. 

 

However if you have a specific DTA that works in your favour not an issue as you say :thumbsup:

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I get a pension from the NZ  govt. paid direct into my Thai account. It is not taxed in NZ as I have been out of the country for more than 180 days so I declare it here and "pay my tax". Every year the allowable deductions exceed my income so there is nothing to pay but I can show that I am a taxpayer should immigration ever ask. I have another income which is taxed in NZ so I do not declare that for my Thai tax. I am better off because I would be paying tax on  my pension income in NZ.

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1 hour ago, topt said:

Perhaps I should have added that in practice it is not currently actioned by the Thai Revenue but it theoretically could be - if they could prove it was current calendar year income which would in many cases be impossible.

Misunderstood!

That is in reference to a person resident for tax purposes for the required 6 months.

It is not applicable to income already taxed in your home Country, with whom Thailand has a reciprocal tax agreement with and then transferred to Thailand.

 

I'm registered for tax purposes, because I reclaim tax paid on the interest from my bank accounts.

Inland revenue can clearly see I transfer funds from the UK into my account, but it's not eligible for tax in Thailand, why - because the income wasn't earned in Thailand and the UK has a double taxation agreement with Thailand, so it isn't taxable here.

The interest on my Thai banks however is regarded as income derived in Thailand and automatically taxed @15%, however as this is below the 'personal tax allowance', I can reclaim it.

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I have no idea who is "Misunderstood"? However you still seem to be completely missing the point of my original comment 

53 minutes ago, Tanoshi said:

Inland revenue can clearly see I transfer funds from the UK into my account, but it's not eligible for tax in Thailand,

I presume you mean UK Inland Revenue and if so I don't understand the relevance however potentially it is eligible for tax in Thailand as per below -

56 minutes ago, Tanoshi said:

and the UK has a double taxation agreement with Thailand, so it isn't taxable here.

For the 3rd time this is not 100% correct. Pensions (other than certain govt. pensions which does not include the State pension) are not covered under the UK DTA with Thailand.

See here  https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/710099/DT_Digest_April_2018.pdf

Scroll down for Thailand (page 34), heading "Other Pensions/Annuities and go to far right and read Note 4.......

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1 hour ago, topt said:

I have no idea who is "Misunderstood"? However you still seem to be completely missing the point of my original comment 

I presume you mean UK Inland Revenue and if so I don't understand the relevance however potentially it is eligible for tax in Thailand as per below -

For the 3rd time this is not 100% correct. Pensions (other than certain govt. pensions which does not include the State pension) are not covered under the UK DTA with Thailand.

See here  https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/710099/DT_Digest_April_2018.pdf

Scroll down for Thailand (page 34), heading "Other Pensions/Annuities and go to far right and read Note 4.......

Read the very top line of that document that you posted the link to:

This Digest is only a guide to possible entitlement to double taxation relief for certain types of UK income received by non-residents of the UK who are residents of the territories listed in the table.

You are not a resident of Thailand, you only have temporary permission of stay.

 

If you are confused, I suggest you visit your local tax office who can explain why your foreign income is not taxable in Thailand. I'm lucky, the niece is the boss at mine and speaks good English.

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If I read this correctly & your wife made an income in Thailand obviously she would need to declare over a certain amount.

Monies you sent from abroad to your account I presume are "tax paid" at source so you can give some to her without further tax liability on her behalf.

Legally, if your money sent has never been taxed you may need further clarification as is a grey area

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34 minutes ago, Tanoshi said:

You are not a resident of Thailand, you only have temporary permission of stay.

As you yourself mentioned you are tax resident if spending over 180 days here in a calendar year. 

 

38 minutes ago, Tanoshi said:

If you are confused,

I'm not but thanks for asking.

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