Welcome to this afternoon’s webinar, Tax Rules for Expats in Thailand. This is kind of a hot topic, not only because of some of the tax rule changes that our partner here will be talking about in just a minute, but it’s tax filing season is almost upon us. So this is a very timely opportunity to get up to speed.
So let’s dive in. Without further ado, I wanted to introduce Carl Turner. Carl is the co founder of Expat Tax Thailand. And like Bontai’s service model, Carl’s Thai team focuses on what they do best, which is helping expats. understand and comply with my personal income tax law. So with that, Carl, I will turn it over to you.
Great. Thanks for that, Mark. Yeah. Thanks for taking the time to join today. So as Mark mentioned, I’m the co founder of Expat Tax Thailand. And the purpose of the presentation is just to provide you with up to date information. So here at Expat Tax Thailand, we help individuals understand their Thai tax filing obligations so they can make better informed decisions.
So as Mark mentioned, we’re Thai registered, Thai majority owned, specializing in helping expats file personal income tax. And also provide ongoing advice. All of the accountants, Thai accountants are authorized and regulated through the Federation of Accounting Professionals. So the areas that we’ll go through today is we’ll go through the income tax rules.
What’s taxable? What’s not? And we’ll give you a definitive answer on who needs to file and who doesn’t need to file. Then we’ll touch on double taxation agreements, which is a long topic, but we’ll explain that in simple simple explanation and then offer some simple, easy Tips for you to follow and strategies.
Then we’ll get into the Q and a session and feel free as Mark mentioned, to put it, your questions in the Q and a box. And we’ll aim to try and get to as many as we can today. There’s been quite a few that have come by email. So we’ll go through those as well. If you do need more information on tax you can look at our YouTube channel.
We’ve got many videos on capital gains or crypto or double taxation agreement for different countries. So feel free to take a look on there. And. Yep. So who will benefit from watching this webinar and joining live anyone who is in Thailand that is living in Thailand and has overseas assets, or anyone who’s looking to relocate to Thailand and considering having an income in the future.
In Thailand. So we do have many, many questions on our website. We’ve got over 200 questions that we’ve answered on there. So you might be able to find questions if you’re watching this, watching the recording, feel free to take a look on there. If you’d like to be kept up to date with any future changes regarding tax, feel free to sign up to our tax alerts.
Because there are potential changes in hand to move to worldwide taxation, for example. So sign up to our tax alerts and we’ll keep you up to date. Just a quick disclaimer before we start. The information provided is for information purposes only. It doesn’t constitute professional or tax advice, financial advice.
Shouldn’t be acted upon in isolation. It’s just to explain the rules. And it’s not specific advice for individuals. So let’s get started on to what’s, what tax changes have actually been announced. So the revenue in Thailand, they issued these two documents on here in September 23 and November 23. I’ll explain, I’ll touch on what they actually explain in English.
So first one was published. In October, 2023, and that was the, um, Paul 161 document is regarding offshore income remitted to Thailand. So it’s regarding it came into force on the 1st of January, 2024, and it’s significant, has a significant impact for Thai tax residents who receive overseas. Remittance and it really makes a big difference for people that are remitting in foreign source income.
So sources like investment, capital gains, pension income, rental property income, if they’re remitting those from overseas, it means it has to be filed on a Thai tax return for Thai tax residents. Second document was actually explaining regarding If you have cash in the bank in previous tax years, so who are these new rule changes actually affect.
So anyone that lives in Thailand, 180 days or more in a calendar year, their class is a Thai tax resident, and then it looks like your visa type. So basically any visa type in the future. So if you have LTR visa, then you are excluded from foreign source income if you remit in the income in the next tax year.
Let’s have a look at what else. So if you’ve got a smart visa, DTV visa, you follow the same rules, retirement permanent residence, a business visa. If you remit in foreign source income, you have to file on a high tax return if it’s not excluded. So when is the Thai tax year? We get a lot of questions on this.
So if the key dates are for the start, the tax year starts on the 1st of January, 2024, it’s a calendar year and finishes on the 31st of December. So for last year, 2024, this has to be filed by the 31st of March. If you file in paper based. Can I just ask is the. Is the camera showing fully or is it showing Mark on there just to make sure that the viewers can see the screen?
Or is it okay? Is it showing up okay on the screen? Am I on full screen? It looks okay to me, Carl. There is sometimes a little bit of a lag. On the, from the internet, but it looks okay. All right, I’ll carry on then. Okay. So there’s an official document that was produced in July last year from the revenue department to explain how foreigners pay tax in Thailand.
And we’ve actually just released a video. To actually discuss with the Revenue Department. So we had an exclusive interview with one of the senior lawyers from the Revenue Department to ask questions from them about how this will be administered. So it’s going ahead and it’s already been put in for 2024.
Let’s go through the definitive answer. Who doesn’t need to file? So this will hopefully put a few people’s mind ease. So if you spent less than 180 days in Thailand, you’re a non Thai tax resident. So if you didn’t have domestic income, so what is domestic income? So if you don’t have a, if you’ve got a Thai rental property or you have a Thai salary, This is domestic income.
It doesn’t matter how many days you are in Thailand, then you need to file. But if you spend less than 180 days and you have no Thai income, you don’t need to file a Thai tax return. Also, if you remain 180 days or more, And you don’t have accessible income, you don’t need to file, or if you bring in less than the minimum threshold to file.
So there are thresholds. If you bring in less than that, you don’t need to file. Also, if you bring in or transfer pre 2024 cash in the bank. So I’ll explain that in more detail further on. Or if you’ve got excluded income sources. So, if The double taxation agreements, we’ll explain that in the future as well, excludes certain income.
You don’t need to put that on a tied tax return, you don’t need to file this. So let’s talk through some of the excluded income sources. So this is a better slide. So if you have U. S. Social Security or You have a civil service or military pension from any country that’s got a double taxation agreement with Taiwan.
So there’s 61, then you don’t need to file a Thai tax return for those income sources. Also Canadian pensions under the double taxation agreement that’s excluded. Cash in the bank from pre 2024, like I mentioned earlier. Or if you have investments that have made a loss or not made a gain, you sell those, you don’t need to file on a Thai tax.
Return. So who does need to file a TITAX return? So if you’ve got a domestic income, like I mentioned earlier, rental property or salary, or if you stay 180 days or more and you bring in, so remit, transfer, overseas income sources above the minimal thresholds. So these things like if you’ve got a pension, dividends, you know, if you’ve got rental income, you sell an investment and you bring in the capital gain.
This needs to be filed on a Thai tax return. So what about this double taxation agreements and claiming tax credits? What if you’ve been taxed already on this income? Well, you may be able to claim tax credits for the tax you’ve paid in another jurisdiction. It depends. You’ve got to look at the specific double taxation agreement, see what the wording says.
So you still have to file a tax return but you can claim back the tax credits potentially. And let’s talk about the filing threshold. So for pensions, it’s pretty low. So if you bring it in less than 220, 000 Thai Baht of pension income per year and you’re married and you’re filing jointly. You don’t need to file a tax return if you’re bringing in less than that.
And if you’re single, it’s on the 120, 000 type of income from pensions before you have to file a tax return regardless if you’ve got tax to pay or not. Other types of income, let’s say you’ve got investment capital gains or rental property. Overseas and you bring the income in, if you’re married and you file in jointly, you only have to bring in 120, 000 Thai Baht of income and you have to file regardless if you’ve got tax or not.
So let’s talk through the different types of income that’s taxable in Thailand. So there are eight different categories. This is section 40 of the revenue code, if anyone wants to take a look. So this explains all the different income sources. So you can see on that pensions, salary. investment capital gains, dividends, things like rental property income, they’re all on there, property sale or any other income like crypto capital gains, things like this.
We’ve already gone through what kind of income isn’t taxable. So let’s just recap again, gift loans, inheritance from overseas, civil service pensions, losses from investments cash from pre 2024. If you don’t live in Thailand, 180 days or more. And you receive an income, you can remit that to someone because it was earned in an anti tax year.
So does everyone have to file a tax return? Well, no. I explained that earlier. What it means is only if you meet the criteria to file. So one, you have domestic income. Or two, you remain 180 days or more and you remit in over the minimum thresholds. If you don’t meet these criteria, you don’t need to file a tax return and you don’t need a TIN.
So how and when to file, let’s say you do need to file, you’ll need to get a Thai tax ID number so you don’t automatically get one you need to apply for that at your local revenue office, or you can use a paid service like ourselves, and then you’ll need to file a Thai tax return so it’s 91 which need to be filed by the end of March start of April if it’s online, you can file yourself.
at your local revenue office, paper based, or you can file online through the revenue’s website. Or you could use a service like Expat Tax Selling where we can file online for clients. So there’s many options for people. Like I mentioned, we do have a TIN service if people would like a tax ID number and they don’t want to go through the bureaucracy of going to the local office.
We can obtain that on their behalf. And we do offer tax filing services all online, fully remote, three levels of service. So everything from people with small retirement pensions all the way through to complicated cases, we can take care of. So let’s talk about tax credits and double taxation agreements.
Now, this is a topic we could talk for. So I’ll try and keep it short. So the purpose of the double taxation agreement is really just to set out taxing rights for certain types of assets. So it allows people to really have a clear understanding how things will be taxed. For example, if you’re living in Thailand and you’ve got us assets, or you live in in Thailand, you’ve got UK or Australian assets.
It explains how these are taxed. Now it’s not, you’ve got to really look at this. It’s not necessarily on your nationality. It’s to do with where your assets are located in their jurisdiction. So let’s say I’m a Brit and I’ve got a pension in Singapore. I look at the Singapore Thai double taxation agreement, not the Thai UK double taxation agreement.
And anything that’s set in the double taxation agreement takes precedence over the local tax rules. So there are 61 double taxation agreements. We’ve researched them all. They’re all on our website. If you take a look and we’ve actually produced webinars on for various different countries. So all the usual suspects, US, Australia, UK, Switzerland, Canada, South Africa, Sweden.
So if you’d like. To look at those videos, if you’ve got information, you’d like more information, there’s a lot explained on there. So let’s go through the common allowances and deductions. So I get this question quite a lot. Now, what are the, what does everyone receive and what can you claim for? So if you, if you do know you have to file a Thai tax return and you’ve got income.
First of all, you can take off your allowances and deductions. So let’s go through that in simple terms. Everybody gets 60, 000 personal allowance. And then if you are married and your spouse does not have an income, then you can claim their allowance. So that’s 60, 000 Thai Baht. An income is anything over 30, 000 Thai Baht per year in Thailand.
Child allowance. So if you’ve got you can claim 30, 000 Baht per child. Also adopted. Children you can claim as well. If they’re born after 2018, you get an extra allowance for a second child onwards. Health insurance. Very important question that we get quite often is it’s got to be a Thai local health insurance provider.
It cannot be international. We can claim up to 25, 000 Thai Baht of the premium. If you have a life insurance, Thai life insurance with a. period, a term of 10 years or more, you can claim up to a hundred thousand Thai Baht, but that includes the health insurance as well. And then one important thing that people, we get a lot of questions on is what if you’re 65 or older?
So if you’re 65 or older, you get an extra 190, 000 allowance on top of your personal allowance as well. But if your spouse is over 65, you don’t get that as well. I just thought I’d explain that. So let’s talk about the income tax brackets. So if you look at the income tax brackets, you can see it’s the same as most.
It is progressive. So the first 150, 000 is not non, is exempt from tax after you’ve gone, taken off your allowances and deductions. And then you go into the next bracket, which is 5 percent on the next 150, 000 off of income and so on. So if you bring it in over 5 million type art of income over and above your allowances and deductions, then the tax rate is 35%.
Yep, so we’ll go through the, let’s go through the tips and strategies. So simple things for people to follow are, you know, you need to calculate the income tax for all the different asset classes. So if you’ve got capital gains, for example, that’s taxed. You do the calculation different to if you bring in pension income.
And if then, if you bring in property rental income, so you need to separate out all of your income sources and calculate. What you are actually remitting him from each source to calculate the tax. If you’ve got tax credits available, we need to have a look at the double taxation agreement to see if you can claim some of the tax that you’ve already paid elsewhere.
If you’re remitting in those really important that you keep. Good track records showing everything that’s been remitted to Thailand and the source of the money because that’s always asked when we file a Thai tax return. And also the exchange rates and things like this. And really a good tip is to try and use the non taxable assets as well.
Make the most of your pre 2024 cash in the bank that you can Deplete over time in a first in first out method, rather than bringing in a new pension income, if possible, if you’ve got the options. Also, you could bring in investment losses or low capital gains before you start bringing in, you know, rather than cashing part of all your portfolio, it might make sense to take out some of the lower performing funds so that you’ve got less of a capital gain and income.
So there is some planning you can do to reduce down your tax and plan accordingly. So I think the easiest way to go through this in detail is to go through the case studies. So we’ve got four different case studies. We’ll go through these, then we can get into the Q and A, but I think this will really help people.
So the first case study, so it’s a 65 year old married. They sold the property in 2023 when they stayed in Thailand less than 180 days. So they sold the property overseas. Now the current year. This day 181 days and they bring in 5 million Thai baht from that sale that occurred in a non Thai tax year property made 50 percent gains.
So there’s a lot of capital gains on there. What’s the outcome? Well, because the person sold the asset. In a non Thai tax year. So they sold it when they weren’t a Thai tax resident, then it means there’s no tax in Thailand. There’s not assessable income. The sale happened in a non Thai tax year. They don’t need to file that.
They don’t need a Thai tax ID. They can remit that any time in the future without any tax implication, less any interest from that point onwards, let’s go through the second case study. This is regarding investment capital gains. So 65 year old. Married, they sell shares and these equity investment portfolio in 2024.
So last year they bring the money to Thailand. They stayed in Thailand 190 days. So they’re a Thai tax resident. They sold the equivalent of 50, 000 or 40, 000 pounds in tech shares. And they’ve got an all time game at 40 percent on those shares. They send the full amount to Thailand. What does this look like on a Thai tax return?
So they’ve sent 1. 7 million Thai baht to Thailand and of that, those shares that they sold, there’s 40 percent capital gain. How do we start looking at this? So what we do is we look at a simple Thai tax table. I will explain this rather than showing it on the screen. So with this person, They would get, because they’re 65 and older, or they’re 65 plus, they would get 190, 000 allowance for themselves, personal allowance to get the spouse allowance and so that they get those allowances already.
Then we add in The capital gain amount into there, which is 400, a thousand Thai baht. So for this example, they bring in 1. 7 million with their allowances and deductions. It means they’ve only got a 1, 800 tax bill. So you can see for a lot of people, they don’t really need to worry, even if they bring in a substantial amount because of their allowances and deductions.
So if you would like to go through a free tax calculation service, we do actually have that. We’ve got. Experts where you can book in for a 15 minute call, go through your own tax calculation to see how much tax you potentially may need to pay. We’re happy to help people with this. Feel free to, to use the link on the website.
Let’s go through another case study. So If you bring in pension income. So we’ve got two examples here for pension income. So this one’s for a low pension income requirement, just to show people that don’t really need to worry. So if you bring in in 600, 000 Thai Baht and you are 65 years old and you live in Thailand.
More than 180 days a year. And you remit that money from overseas, whether it’s from Australian superannuation or UK pension, for example, or, or net pension from the Netherlands, for example the married. Spouse doesn’t have an income and they’ve got local medical insurance. Well, the benefits of being 65 or older is you get quite a lot of allowances.
You would get again, 60, 000 personal, the spouse, age allowance, a hundred thousand because they’re bringing in a pension income and the medical insurance. So the total allowances and deductions for this example is 435, 000. So just. Because they are over the minimum threshold of 220, 000, they would need to file a TITAX return.
So just because they don’t have tax to pay doesn’t mean they don’t have the file. So because they’re over that threshold, remember we mentioned that at the start of this presentation there’s a threshold, a minimum threshold they would need to file a TITAX return. For a simple case like this, our essential tax filing would be the most suitable.
But for this example, for they bring in 600, 000 Thai Baht with their allowances and deductions, they’d only have 750 Baht of tax to pay. So they could use our service to file the need to tin. But the reality is if they’ve paid tax in another jurisdiction, they might be able to claim that tax back as well.
Now, if they had a higher pension income, we’ll explain that as well. So let’s assume someone brings in 2 million Thai Baht per year from. Pension income and they are 62 years old. So they don’t get that age allowance and they’re not, they’re not married. Let’s see how that looks on the tax return. So they would only have a personal allowance, 60, 000 plus the, because they’re bringing in income 100, 000 and they don’t have anything else on there.
So on, if they brought in 2 million Thai baht, In this example, then the tax would be 16%. So you can see it really makes a difference with the age and how much you are remitting in. But if they do have tax paid on these pensions dependent on the double taxation agreement, they may be able to claim the tax credits.
For the tax that’s owed in Thailand. So we’d have to file, but we can potentially claim the tax credits on there. So it might not be as bad as it looks. Now, if they were 65 plus and they were married, for example, with the allowances and deductions, that would bring it down to 254, 000, so 12%. So it makes a big difference if you do have allowances and deductions.
So again, if you would like to keep up to date with any changes, it looks like there will be changing the. Tax code in the future, feel free to sign up to the tax alerts. If you would like to go in more detail than a 15 minute call, and we can have tax consultations as well to go through your own situation and you know, they’ve sent K bank has sent out information regarding CRS and FATCA recently.
I don’t think people need to panic, but. You know, the information is being freely shared now with other common reporting standard countries. So there’s more than 120 signed up. So it’s important that people do comply. So what are the implications if people don’t declare a Thai tax return? So the easy solution is to comply and not have any problems.
But let’s talk about implications. If you don’t file on time, so let’s say you file. In May, rather than in by the deadline and the 8th of April, then you would be charged 1. 5 percent for each month that you miss the tax. If, for example, people don’t file and the revenue department sent an audit, somebody to say, we we’ve seen that you’ve received, it looks like income.
Can you prove it? And you can’t, or you show that it is income. You can get a penalty up to 200 percent of the tax that’s owed plus 1. 5 percent per month for every month that’s been owed. Plus a fine and obviously further implications regarding visas. And obviously it’d be a criminal offense as well. So really it’s quite easy to comply.
And the majority of people, it’s more of an admin issue rather than a punitive tax issue. So it’s important that they comply and, and follow the rules in the kingdom. So we’ve got quite a lot of questions that have come in by email. So I’ll go through those first, and then we can go into the Q& A that have come in live.
So I receive a lump sum pension from Pension Plans in Switzerland, Pillar 2, Pillar 3a. Switzerland withholding tax was paid on the payouts as I’m arisen abroad. The money was transferred from a Swiss account. Payments are now being made to Thailand for my living expenses. transfers tax free as the money is already taxed.
So what you’ve got to do is you’ve got to look at the specific double taxation agreement. Just because you paid tax in another jurisdiction doesn’t mean that it’s tax free and also it doesn’t mean you don’t have to file a tax return. So for this example, You’d have to file a Thai tax return for the income that’s been remitted from those two pensions.
And then you could potentially claim the tax credit for the withholding that’s been taken on the Swiss Swiss pensions. So it doesn’t mean you don’t have to file even if tax has been paid, unfortunately. We’re drawing money from my IRA in the US for purchasing property here in Thailand. Will this be assessed?
Would this thing? be an investment into Thailand here currently on a nono visa. Would it be worth the effort to convert to an LTR visa? So this is an example of US IRAs actually classed as pension income, which sounds strange, but that’s the way it is. If you remitting the IRA, then you have to file that as income in Thailand.
It doesn’t really matter what you are bringing the money in for. If you bring it in to purchase property or. Used to buy a new car or send to your spouse, for example, still you remitting in the money, then IRA would be need to put down on the Thai tax return. So if you’re in Thailand 180 days or more, you’d need to file that amount on a Thai tax return.
If the amount you bring in is over 220, 000 Thai baht. Would it be worth the effort to convert to an LTR visa? So the LTR visa, which Mark knows a lot better than I know, is all to do with If you get the LTR visa, then you are exempt from foreign source income if you bring in the income in the next tax year.
So potentially, if you do have income sources which are not taxed elsewhere or do you have a tax implication in Thailand? It might be worthwhile exploring an LTR visa, for example, because if you did get that, you could receive the IRA into your overseas account and then in the next tax year remitting the income and it would not be accessible income in Thailand.
That’s the benefit of this LTR visa for the tax purposes. A question here on superannuation. So it’s a long question but I think it’s important to get it because for many questions about Aussie supers. So the person here mentions that it’s already taxed at 15 percent on the way in on contributions and the money’s locked up until 60 or further.
There’s no tax in Australia when you withdraw once you get to the preservation age. Now the problem is When they do get to this age and they remit into Thailand, the rules in Thailand show that you are remitting in pension income. The double taxation agreement between Australia and Thailand does not exclude superannuation pensions.
So what does this mean? It means if you remit, transfer, Australian superannuation into Thailand and you are a Thai tax resident. So you, so you get an income from your super or you take a lump sum after preservation age in and you bring that into Thailand. You have to file that on a Thai tax return. Now on this question, someone asks, is it worthwhile lobbying an audience with the revenue department?
The reality is with Aussie supers. If you move to Spain, or you move to the UK, or you move to USA, it’s the same rule. They see it as income, so they don’t will follow the same rules just because it’s tax exempt or tax free in the country in another country. It doesn’t mean when you remit that into Thailand, it is that it follows the same benefits.
So fortunately, unfortunately this is one way if you do remit that in, it is accessible income. The good thing is if you, it depends on your age, you do get the allowances and deduction, so maybe you can manage it out that way. And it could be another example when the LTR visa might be suitable. Okay, how will gift be treated that is remitted from overseas to a Thai tax resident?
Such a gift will be remitted only from close relatives. So let’s talk about gifting. We get a lot of questions on gifting. So the Thai inheritance tax rules for domestic inheritance is 100 million Thai baht per person. So let’s say I died and I leave. 105 million baht to my wife. That means the a hundred million Thai baht is the allowance.
Five, sorry, 5 million of that would be over the allowance. So that would be taxable with inheritance tax rules in Thailand. So what gift tax rules are for is really, you can gift up to 20 million Thai baht to your spouse per year, but this is to reduce down your overall estate for inheritance tax purposes.
It’s not a way to reduce down your personal income tax. So if. You can gift up to 10 million Thai Baht to a non non spouse, non ascendant descendant, but this doesn’t mean that it doesn’t fall under income tax rules. This is just regarding your inheritance tax rules and gift tax rules. So it’s slightly different.
A gift has to be a gift without reservation of benefits. So if I gift to somebody and then I benefit from that anytime in the future, like a. Gift and then live in the property or gift and then receive the money back in the future. It’s not a gift. It’s a gift with reservation of benefit. So using gifting for income tax planning is not really that beneficial to be quite frank.
What do you say about all my, to my British friends living here that tell me that they’re just going to ignore the title? Tax law, and they don’t have the manpower or technology to catch them. Well, with our exclusive interview with the revenue department that we were releasing it was quite clear that they’re taking this serious, expect people to file if they have a tight personal income tax liability, everything’s linked now.
With immigration, the amount of days that you’re in Thailand to your bank, to common reporting standards, to your overseas accounts and the Thai revenue department are actively investing time, effort, money into AI as well to help track this as well. So it’s more important in my opinion to stay compliant because they can audit up to five tax years as well.
So it’s quite easy to follow. I think it’s better to stay compliant rather than just. Putting your head in the sand, to be quite honest. Question here, I’m 71 years old and I live in Thailand. I transfer my pension here to Thailand every month. It’s taxed in America. Do, does the fact I’m taxed in America, do I still need to pay a tax here in Thailand?
I file a Thai, an American tax return every year. So for all of the American listeners and, and people that have joined live, you need to really focus on the US Thai double taxation agreement, because It’s a bit of a nuance with that compared to other countries in terms of if you remit transfer pensions into Thailand, and you are a Thai tax resident, they’re actually taxable in Thailand, and you can claim back the money that you’ve paid on your US tax return.
So it’s a slightly different nuance. Just because you pay tax in another jurisdiction or you’re going to pay tax doesn’t mean you don’t have to file a Thai tax return. But for Americans, it follows the same rules as other countries. If you’ve got investment capital gains, let’s say you’ve got a brokerage account, for example, and you make a gain and you send money to Thailand, you have to file a Thai tax return.
You can offset the tax paid in US on the taxes paid here. So I hope that’s useful. I read some news that the Thai Revenue Department is drafting additional legislation to require individuals residing 180 days or more for global income tax. It’s a major change for foreigners residing, may decide to leave or opt out for elsewhere.
Would you mind giving an opinion on this? So I think it’s important not to speculate on things like this until we know more details. Being part of common reporting standards means you have to adhere. to OECD rules. First was to get rid of this loophole, which was keeping money overseas for one complete tax year.
That’s gone now. Then it will be moving towards a worldwide taxation basis. Now, until we see the details, I don’t think people should worry or panic because we don’t know how it will look. For example, Cyprus is part of Common Reporting Standards and one of the founding members for OECD, but is quite favorable for dividends and retirement income at five percent, for example.
So you can be part of a worldwide global taxation basis and have favorable tax code. We don’t know how it will look. It will not happen for 2025. It might be 2026 or 27. We will keep people up to date with any changes. And we’re happy to help people understand the rules if they do make changes. We’ll be selling our house in the US and bring the proceeds to Thailand.
Will this money be taxed in Thailand? If not, Do we have to file a tax return? It’s a very good question. There’s a lot more detail we need for this. So it’s important. When will you sell the property? Will you sell it when you are a Thai tax resident? So 180 days or more. If you do, then if you remit that money into Thailand, then you will be liable for the.
Tax, or you’ll be liable to file for the capital gains on the property. So if you sell the property and you haven’t made a profit, fine, you can remit that money. If you live in, if you are a Thai tax resident, you sell the property and remit and you made a profit, then the problem is you may need to file, you will need to file a capital gains that you remit into Thailand.
So if it’s important that you seek advice if you are selling a property to make sure you’re doing it in the right way. Or again, maybe LTL might be suitable for certain people. So before we get into the questions, you know, we do offer online tax fund, like I mentioned earlier, one on one consultations, we can help people obtain TIN numbers and, and do use our free services.
Do use our frequently asked questions section. Please do use our free consultations. It’s really to help people understand the rules so they can understand their tax fund obligations so they can make better informed decisions. And we are here. To help, so we’ll get on to close down this presentation now, and then we can start to go through the questions that have come in live.
It’s been quite a few. Yeah, it’s a, it’s an engaged audience, Carl, while you’re calling that up. I had a question. You’re required to remit. 400, 000 Thai baht in order to extend a nano dependent visa and 800, 000 Thai baht wired into a Thai bank account to extend a nano retirement visa. Is that considered a remittance into Thailand and therefore, you know, essentially, yeah, Mark.
Yeah. Good question. So. It depends on the source of the money that you’re remitting in. So it doesn’t, their requirements for the visa is not nothing to do with the revenue department. So the same rules apply. Is it cash in the bank from previous years? So pre 2024, that’s not accessible income. Is it a non accessible income source?
So could you show this is from US social security or Canadian pension, something that’s not, not taxable. Is it, if it’s new income, for example you know, that you’ve had paid out, then yes, that would need to be filed. So it depends on the source of that money. It’s not, there’s no exclusion because it needs to be coming for the visa.
That’s completely separate requirements. So yeah, I understand, I understand the point and people and also when people do pay the tax bill as well, if they are remitting in foreign source income to pay the tax in Thailand. We need to look at the source of the money they’re bringing in to pay the tax as well.
So anything that’s really transferred to Thailand, we need to see the source. Yeah. Yeah. So some strategic thinking before you make the wire transfer could, could help you in the long run. Yeah. So, so for example, we had someone that made a mistake and they sold a large amount of crypto last year in November, didn’t realize the rules remitted in.
6 million Thai baht into Thailand, and then they found our website and found out it is taxable. So, for example, then they’ve got a 1. 8 million baht tax bill because they’ve got a large amount of capital gains. And for those, he’s got to bring in money from overseas to pay the tax. So it’s important before you make big decisions, just, just to check the situation, to be honest.
Yeah, thank you. So should we start going through the questions? There’s quite a few. Should I put them on the, should I put them on the screen? There we go. Yeah. Yeah. Okay. So what if the local revenue department says you don’t need a tin? So I think it’s really important that the problem is, I think when people go, I’m not saying for this specific person, but I think some of the problems come about, whereas I think if we look at back in, let’s say in the U S let’s say I went to local revenue, the local revenue IRS office.
In a small town in US and I started to talk to them in Thai or broken English, for example, and I started to ask them about a Thai pension. I’m sure the same answer might come out that, you know, they’re not really qualified to deal with this. They might tell them they don’t need to do anything when the actual rules.
state that they do. So it’s important. One, in my opinion, if you do go to your local revenue office, take someone who can speak, speak Thai to actually help you with the process. Two, maybe take some supporting documents to show that you have remitted in foreign source income, and then they should be able to issue that, that tax ID number for you.
So, so if you do have problems, obviously we can get on your behalf, but if you’ve got the time and inclination, please. Go back to the revenue office with the documentation showing what you have remitted in and yes, they should be able to issue that for you. Yes. Okay. Let’s go through a few more. Right.
Someone brings in more than the threshold, say 1 million Thai Baht, but it’s from pre 24 savings. Might it still make sense to report as income and pay tax on it? Because the amount of tax you pay is pretty small. In other words, the price no. In my opinion, if, so the question is, do you think we should, even if I just bring in cash from previous years, should I file and just pay tax on it anyway for like an easy life?
I think that’s, that’s really the point. No, I think the important thing is to follow the rules and keep a good record of where this is remitted in from. So if you can keep a good record and you can clearly show this is not accessible income, then it doesn’t make sense to pay tax on something that’s not.
Accessible income, in my opinion you, if you only bring it in cash from pre 24, you don’t need to file a tax return. There’s no requirement to file for if you have a zero tax return. So you’ve not brought any income in. So I think if I hope that’s helpful, but you really do need to keep a good record.
Cause they can order and ask for the information for five complete tax years.
Okay. Let’s have a look at this question. I have an LTR visa. I’m a U S military retiree bringing in pension income only at the state time. Does the LTR mean I can bring in funds from investment interest? Bitcoin tax free. So I assume this is the retirement, wealthy pension LTR rather than anything else.
Cause I’ll just talk about that specifically. So for this visa, if you bring it in a military pension, that’s not assess it’s excluded on the, if it’s a us. Military pension. So you don’t need to file a Thai tax return for that. But if you do bring in other assets, so investment, capital gains, interest, Bitcoin, capital gains, then you need to file a Thai tax return.
If you bring that income in the same tax year, if you bring in the next tax year, it’s not assessable income. So I think it’s better to explain the LTR rules. But that, that’s the, how the tax works. So yeah, exactly right. Yes. It could be quite advanced just to, to look at that. But again, it might be good to do a bit of planning rather than making a mistake and remitting in assets.
Let’s have a look at a few more questions. Well, this is a long one. I’ll put it on the screen. I’ll move. I’ll split it up. Okay. Let me try and split this up. And I’ll let me try. Okay. I live and work legally in Thailand. I have a work permit and work for a school. Pay taxes every year. Married a Thai woman.
Recently sold investments in the US and sent some money to Thailand to put down my property. Okay, so they’re a Thai tax resident. They’ve also got another income in Thailand. I did not know about the tax rules when I did this and I’m wondering if I’m liable for the money I sent for the payment for the house.
If yes, I’m guessing I do not owe the entire amount, only the capital gains. However, I’m unclear what to do. How much I’ll owe due to cover gains. Okay, clear. So they’re American, they’ve remitted in foreign source income, which is capital gains. What do they need to do? So first of all, what they need to do is calculate what was the capital gain percentage of what they remitted into Thailand.
So you are liable for filing for the capital gain percentage, the amount of capital gain that you brought in. So it’s not the whole amount, it’s only the capital gain amount. So let’s assume You’ve got a 50 percent capital gain on what you brought in. So you bring in a million Thai Baht of you sell something and it’s got a 50 percent gain.
You bring in a million Thai Baht from there. What we do is we don’t put down the whole amount as income. We put down a third because a hundred percent is the capital. 50 percent is the gain. So it’s a third of the money. So bring in a million Baht, it’ll be 333, 000 Thai Baht is income that will be added to your other income in Thailand.
So you mentioned you’ve got a salary already. So you’re already up the tax bracket, so you’d add that money on top of that, if that makes sense. Plus then, if you do have, if you’ve paid tax on that in the U. S. for example, you may be able to use the tax paid as a tax credit. So, might not be that bad, but I recommend you have a look, because if it’s a large amount, yeah, maybe you need to do an assessment.
And, and Carl, if I could jump in one second here the BOI announced that the cabinet approved some changes to the LTR visa. Including the highly skilled professional category working in Thailand, that’s going to include certain instructors in higher education and vocational education. And that tax rate, if I have this right, is capped at 17%.
So for those that are working at schools here in Thailand, you may want to stay tuned. We think that those changes will go into effect in the next few months. It’s got to go be published in the Royal Gazette and so on, but that will be look, that will be worth looking at to see if you qualify for that particular LTR category.
That’s good. That’s good. Really good. Okay. So just really important question. We get this a lot. Do credit cards, does credit card spending in Thailand for a foreign credit card count as remittance? So what we’ve got to look at is when we look at anything like this is look at is what you’re doing following the spirit of the Thai tax rules.
So even if credit cards are not specifically mentioned in the revenue code, We still have to look, if you were audited and you were using a foreign credit card and let’s say you were using, you live in Thailand 180 days or more, and you are using a foreign credit card for spending in Thailand because it’s easy and you are paying that off with social security money that’s not taxable or cash in the bank from previous years, you could easily quite justify that that’s not accessible income because you’re paying it off with a non accessible income source.
But, let’s say you have a large amount of crypto gains, investment gains, you’ve got a private pension that’s been paid into an account overseas. You’re using a credit card to pay for your rent, school fees, you know, you’re spending a lot on the card. And what you’re doing is you’re paying that off with accessible income from overseas.
If you are audited, 100 percent you will be said that you are trying to evade tax and it will be classed as accessible income. So, you need to really look at, is it follow the spirit of the tax rules and is what you are doing, you know, could you justify on the audit that this is not accessible income.
It’s the same with ATM withdrawals, ATM visa card payments, credit card payments. Got to look at the source of the money. Whether that’s someone’s mentioned earlier about wise as well, same you know, now with common reporting standards that can get the data from a lot of these countries direct. So like, yeah, the net sort of closing on this sort of, this sort of activity.
Okay. Let’s look at this question. So if you bought a car last year using a bank wire from abroad, is this amount taxable? It depends. It doesn’t really matter. Okay, let’s say I remain time 180 days or more. It doesn’t really matter where I send the money to. If I wire the money to the car showroom or send it to the school or send it to a third party and another person is still me remitting in the money.
And with them, we need to see what’s the source of that money I’m bringing in. So if I’m bringing in. They excluded income sources and I can justify that that’s not accessible income. If you are bringing in income sources, then yes, it is accessible income. Yeah, can I, this is an important question that we get, can I declare my house rent as paid by my company I work for, or is it accepted as a company cost? Yeah, it’s added to your income. You can’t really, you can’t really exclude, you can’t add that as well. So it’s, it’s let’s look on here about extensions.
Very important question. Is an option to file an extension like they’re in a lot of countries, like Switzerland, US or else. That’s a deadline. So 31st of March is the date for paper based, but we’ve actually got, so for example, we can file all the way up until the 8th of April online. You can’t get an extension.
If you are late, you will get a 1. 5 percent penalty. for the tax that’s owed, even if you’re a day late. If you file on time, you can, you can pay over three payment terms. If you file late, no, there’s no option to do anything like that. So no, that’s the final date. There are no extensions no.
Okay.
We’ll look at a few more. Okay. This is very important question. How do you differentiate between the source of income when you’ve got like a pooled account with different sources in there? So very easy. If we look at your account, we can use first in first out methods. So let’s say you had a cash balance on the 31st of December, 2023 of, 000 us dollars.
Overseas or pounds or euros doesn’t really matter. Aussie dollars. That amount is not accessible income in Thailand. It’s cash in the bank from previous tax years from pre 2024. This was announced in November. On those Two documents that are on there. So what we can do, that’s the starting balance that you can remit into Talent without any tax implication.
So you can always draw down on that on a first in first out basis. Once that’s spent, then we look at where what’s been paid into there since then. So then we can look at the income sources so you can differentiate with the first in first out method. Really important to keep a good record if you can, it’s important in my opinion, you don’t have to do this, but it’s easier if you could, if you’ve got different income sources and they’re all taxed differently, maybe set up sub accounts or different accounts.
So, you know, if money comes in from here, it’s not assessable income. If money comes in from here, you know, it’s pension income. Money comes in from this one. We know it’s investment capital gains might make your life easy in three, four years time when you’re trying to track back where money’s from. You don’t need to, but for my mind, that’s how I deal with this.
And it’s easy when we’re filing for people then as well.
Okay. Question here. What proof yes, similar question. It follows on. I think it’s important. What proof is needed to show that money remitted was earned pre 2024. So again, bank statements from 31st of December, 2023. And then what we need to see is the. Transaction history, not really INS, not bothered about INS, but just withdrawals since that point because that’s always drawing down on that pre 2024 balance.
So that’s how we can prove that you’ve still got the money in your account from pre 2024 that you can show that was being remitted into Thailand. You don’t need to file this on a tax return you just need to keep that and you file for record.
Let’s have a look at this file. Do I have to provide a broad bank account files? Oh yeah. Okay. Good question. So what, what documents do we need? So it depends if I file a tax report, do I need to provide the broad tax account files? It depends. Depends what you bring it in. You know, we have to file the Thai bank statement showing the money remitted in.
If it’s capital gains, we have to show the investment capital gains. If it’s property rental income, we need to show that. So it depends. For some cases, yes, some we have to upload, some we don’t most you have to keep on file for your own record.
Let’s have a look at a few more questions,
right? I obtained an LTR in January, 2025. Do I need to do a tax return for 2024 tax year? Depends. So if you’re in Thailand for 180 days or more in 2024, and you brought in remitted in foreign source income over the minimum thresholds, then yes. If you were less than 180 days and you didn’t have Domestic income?
Then no. So it depends. The LTR visa in 2025 doesn’t exempt you from filing for 2024.
All right. Okay. I’ve got a question here. I’ve had this question quite a few times. I think it’s important to say, so for people that work in Thailand, the, if the money remitted from overseas actually was sent from Thailand before, I assume this is from salary and they’ve sent it overseas and they’re bringing it back.
What would the implications be? So if you can show you’ve already paid tax on the money in Thailand and you’ve sent it overseas, It’s not accessible income if you remit that again to Thailand. But if, since you’ve moved to overseas, you’ve earned an income or interest, so you’ve invested into investment portfolio, then that’s different.
Then we’d look at the investment capital gains or the interest. So it depends what you’ve done with the money since you’ve moved to overseas. I assumed it wasn’t static. Let’s have a look.
Right. Okay. Let’s have a look at this.
Is there a double taxation agreement with Hong Kong? Yes, there’s 61 in Hong Kong’s on there as well. So the DTA for everything. So if you’ve got rental property income or you’ve got a salary, for example, yeah, that’s included in the double taxation agreement. It’s on our website. If you’d like more information, you can, you can, you can get in touch.
Okay. This is very important question. So we have a lot of people. Okay. It’s good to understand the rules. So people mentioned, you know, bringing in cash into Thailand and then exchanging it here for Thai baht is this tracked as remittance. So if you bring it in cash, so the rules for revenue and customs to declare cash.
Is not nothing relevant for the revenue department. So if you bring it in cash and what you are bringing in carrying across is accessible income should be filed on a Thai tax return. So what are the implications if you don’t? Well, if you change it at a money exchange, they take your passport number.
They can see you switching the money. They’ve got a record, so it can be tracked as remittance and then it would be back to the same point. Where’s the source of this money? Right. Let’s have a look at this question here. I’m not really clearly ready, but I thought it was quite interesting. Can I clarify it one more time? If I earned overseas income in 2024, and I clearly owe tax for 2024 on whatever I remit to Thailand. If I remit in 2025, more money earned in 2024, is that an exempt from tax in 2025?
I still have to file in 2025, assuming I’m tax resident in both years. Hmm. I’ll try. I’ll, I’ll talk what I think this means. So it means you’ve earned money. Overseas in 2024 retired tax resident. If you bring in the money in 2024 remitting the money, yes, it’s accessible income in 2024. If you remit it in 28, it’s accessible income in the year that you remit the money.
So before the old rules. Which is kind of like a heaven in Thailand is if, if you’re remitting the money in the next tax year, it’s not accessible income. That’s what changed from the 1st of January 2024. And that’s the danger of, if you look on Google, it’s still pulling a lot of the data and rules from the pre 2024.
So I think that’s where this is a bit, you know, the misunderstanding is. So if you revenue, if you have any income. You earn income this year overseas, and you’re a Thai tax resident. If you remain in Thailand any time in the future, it’s accessible income. So I hope that’s cleared that up. Unless you’re holding the LTR and you’re bringing it in next year.
Yes. Well done, Mark. Thanks. Thank you.
All right. Okay. Yeah. Good question about TINs. So I want a retirement visa, but I used to work in Thailand and I had a work permit, is my TIN the same number? Yes. So you keep the same TIN number. It’s a 13 digit number. You can use that ongoing. But if you do have a pink card, it’s the same digits, 13 digits, but for foreign nationals doesn’t count, doesn’t work for tax filing.
So, and you’re talking about the pink Thai ID card, ID card. Yeah. Yeah. So you still have to register for, it doesn’t work. You know, if you try and use it online or go there, it’s not, it’s not linked to your account. So you still have to go to the revenue department to get that linked, but if you don’t link it, they give you a new one.
Okay, I sold the business in 2013 before moving to Thailand, living off the proceeds from the sale, transferring the funds as needed, supplementing my social security and veteran’s income. Is the money transferred from the proceeds taxable since it was pre resident status? So you’ve had the account, you’ve had the money in the account since 2013.
So it’s a long time. If it’s in cash and you haven’t made any gain, then no, it’s not accessible income. But what have you done with the money since? If you move the money into, say, an investment portfolio, like a Schwab account or something like this, and you’ve got investments in there, then we look at, this is an investment portfolio.
And if you sell, bring into Thailand, we look at the capital gains. So it depends what you’ve done. Also, if you’ve earned an interest on this. You need to, and you bring in the interest. Yeah, that’s accessible income. But in principle it’s not accessible income because it happened in an anti tax year apart from what happened since.
Okay, let’s see if there’s any more questions. A lot of them we answered throughout the webinar, actually.
We’ll look at some of those that in. Yeah, we can, we’re right at the top of the hour, but we can go as long as you’d like, Carl. Yeah, I’ll probably do a few more because. Let’s let’s do it. Let’s do a couple more. If you found a couple of more or intriguing questions. And then, as we said, if we didn’t get to something, you’ve got the FAQs, and they’re always available for consult.
Yeah, right. This is a very good question. I get this a lot. I think it’s important. So, if I sell stock, and I’ve got principal and capital gain, and I remit into Thailand, and the amount is less than the principal amount, can I consider it as not a capital gain and not accessible income? No. So, if you, if you sell an asset, and you make a gain, you can’t then decide, unless it’s Fixed deposit or cash in the bank, then that’s different.
But if you sell an investment portfolio or property, you can’t then decide, I’ll just bring in the principle and not the gain, whatever you bring in a percentage of that is a capital gain from the amount that you sold. So yeah, you can’t, you can’t decide whether it’s the principle or the gain. It’s the percentage of whatever you bring in, whatever the gain.
So if you, if you made a 20 percent gain, we would put down and you brought in. On the half of the money, on half of the money, we put down 20 percent of that as a gain. That makes sense. So your portion for the amount that you bring in, you can’t just decide yourself. So that’d be like a heaven as well.
Unfortunately not. But, but if you pay tax on the capital gain in your home country with the DTA, you may be able to get a credit for that. Exactly right. So, so it depends on your situation. You can claim the tax back if you, if there’s a DTA in place and you can claim the tax credit, but we still need to file that and for the capital gain amount.
Yes, exactly right. Okay. Last question. And then we can go through okay. One other question on there that I don’t put on as a Thai privilege visa provide any tax advantage like LTR. So now. The elite visa, privileged visa. There’s no tax advantages like LTR is the same as all the other visa types. So currently the only tax advantage visa is the LTR and same for permanent residence.
Right. So PR follows the same rules as everyone else. Correct. So Swiss citizen married. With a wife’s paid tax pay every month, 45, 000 Thai Baht, the family one child gets 11, 000, 11 years getting child allowance. Okay. Disabled have a tax card. What do I get minus from my income? What can I,
okay, so just setting up the allowances. Yeah, I think this sort of question we can answer. We’ve got all the allowances and deductions on our website on there. So yeah, I hope that’s been useful. For all of the questions that have come in that we haven’t managed to answer, we will also do a live Q and A.
Every week that we can answer these sorry, I don’t mean to get, get through to them all, but there’s been over 50 questions that have come in and yes, it’s, it’s been a lot. So, so accessing that live Q and a every week. How would they get there just through our website? We’ve, we’ve got all the on our website with the webinars, which have the links to the live Q and a.
On the, for every week, and you also have a robust YouTube channel, which you’re constantly updating as well, which I found quite helpful. So thank you. Yeah. Great. Well, Carl, thank you very much. Obviously this was a very engaging hour. It’s a very hot topic. You and your team remain available to help people going forward as we enter in the.
Filing deadline, which I’ve learned today cannot be extended, so I’ll be sure to file my tax return on time this year. So thank you very much. And like Expat Tax, if people heard something here about a visa program, including the LTR program, we’re also happy to host a free consult and kind of go through your numbers with you and see if you qualify.
Yep. Well, thanks for joining. Hope you found it useful. And we are here to help. So if you do have any questions, you know, we’re happy to try and make sure that you understand the rules. All right. Thank you. Have a good evening. Bye bye.