Taxation

[Guest]

So after you have met the proof of income requirements for a retirement visa, how much of it does the Thai government cream off in taxes?

 

If there is significant taxation, would it be more efficient to qualify by having a lump sum in the bank account? I figure peoples incomes may arise from share dividends & so on, which may already have been subject to taxation abroad.

[Guest fountainhall]

The retirement remittance from overseas is not subject to tax. At least. I have never paid tax on it!!

[Bob]

Unless you earn income in Thailand, I'd think there would be no income to report in/to Thailand.

 

I've always wondered if the meager interest income I earn with the Thai bank account (I use the 800k-baht requirement for my visa) is reportable to the Thai treasury department. I don't report diddley to them (although, now that I've had to file the annual report with the US Treasury Department about my Thai bank account, I'm lucid enough to report that interest on my US tax return!).

[Guest travelerjim]

Unless you earn income in Thailand, I'd think there would be no income to report in/to Thailand.

 

I've always wondered if the meager interest income I earn with the Thai bank account (I use the 800k-baht requirement for my visa) is reportable to the Thai treasury department. I don't report diddley to them (although, now that I've had to file the annual report with the US Treasury Department about my Thai bank account, I'm lucid enough to report that interest on my US tax return!).

 

Bob,

 

I think you have already paid the income tax due for the bank savings account interest...as the bank automatically deducts the tax when they pay interest

into your savings account...(like a payroll deduction withholding tax)

due and sends it to the Thai government.

 

I think the rate if 15% of interest earned...

Ask the bank...they can confirm for you...

 

I think there is a threshold amount of account balance

where the bank must do this at..not sure of the amount.

 

tj

[Bob]

Bob,

I think you have already paid the income tax due for the bank savings account interest...as the bank automatically deducts the tax when they pay interest

into your savings account...(like a payroll deduction withholding tax)

due and sends it to the Thai government.

 

If they do, they deduct it before the interest is paid into the account (as the deposit book records don't seem to indicate any tax paid). It's rather irrelevant anyway as, even with a somewhat healthy Thai bank account (more than the Thai one-year visa minimum), it's peanuts.

 

Come to think of it, one of the ladies at the bank (SCB) told me in April that she could move 800k of the amount into a higher savings rate (and she told me it was 4 or 4.1%) and that this type of savings account (or maybe it was a specialized cd) would still qualify for the one-year-visa deal (apparently funds put into certain types of bank deposits won't qualify). I meant to do that before I left but I'll certainly look into it next month when I get back. If it's anywhere near 4%, that's twice as much (or more) than what the US banks are paying these days.

[Guest travelerjim]

If they do, they deduct it before the interest is paid into the account (as the deposit book records don't seem to indicate any tax paid). It's rather irrelevant anyway as, even with a somewhat healthy Thai bank account (more than the Thai one-year visa minimum), it's peanuts.

 

Come to think of it, one of the ladies at the bank (SCB) told me in April that she could move 800k of the amount into a higher savings rate (and she told me it was 4 or 4.1%) and that this type of savings account (or maybe it was a specialized cd) would still qualify for the one-year-visa deal (apparently funds put into certain types of bank deposits won't qualify). I meant to do that before I left but I'll certainly look into it next month when I get back. If it's anywhere near 4%, that's twice as much (or more) than what the US banks are paying these days.

 

Bob,

 

Yep..I think that is true..they credit the interest...

after they have deducted 15%..of the interest earned for taxes to TH...

so you do not see it..it does not appear as a deduction in your passbook.

 

Be Careful...the rules in TH are different than those in USA..

I have looked and looked...and the 4% + rate is mighty suspicious to me.

 

Several of the banks have been using a "step up" rate CD...which starts at

about .75% - 1% and in 36 or 48 months steps up in small increments ...

25% - .50%...to reach the final ad rate as high as 5%..

but the "proof in the pudding" is in the effective rate of return...for the entire period of months...the 5% rate may be for the final 3 months of the CD.

 

In the USA banks must also include that rate in the promo ads...not same in TH.

 

Also...the TH banks "cross the line" IMHO...when dealing with pushing the sales of life insurance...cloaked in their ads... and pitches inside the banks by hungry staff bankers...by promoting the "savings plan" (life insurance)...with rates of 5% ++.

 

tj

[2lz2p]

To my knowledge, there is no tax on pension funds transferred into Thailand - at least I haven't had to pay any.

 

As far as interest received on Thai bank deposit, as I understand it, the 15% is deducted before the interest is deposited. Apparently, if the interest is earned on a "time" deposit, one can get a refund -- see this article refund of taxes paid on interest

 

Immigration will accept bank accounts that allow you to withdraw funds at anytime (some banks with higher interest accounts require funds to be on deposit a specified length of time, but allow withdrawal at any time, but you lose the higher interest if before the time specified). Bank accounts that restrict withdrawal until a specified time period has elapsed (e.g., similar to US bank certificates of deposit), will probably not be accepted - at least this is what was said when the recently former Honorary British Consul spoke to the Pattaya City Expats Club.

[Bob]

Bank accounts that restrict withdrawal until a specified time period has elapsed (e.g., similar to US bank certificates of deposit), will probably not be accepted - at least this is what was said when the recently former Honorary British Consul spoke to the Pattaya City Expats Club.

 

The SCB lady was telling me about this special or new account they had which would allow earning a much higher rate of interest and yet still qualify for the bank letter for immigration for the one-year visa. I didn't have or take the time to deal with it then (I was there to get the bank letter to renew my visa and wanted to get it done that morning, which I did) but will do so when I return next month. If I remember, I'll report here what I find out.

[Guest travelerjim]

Bob said..."If I remember, I'll report here what I find out".

 

Bob..you are way too young to be forgetful...

 

for me I do have my "Senior Moments"...

 

Take care..

 

tj

[Guest fountainhall]

I would be thrilled to earn anywhere near 4% at present. I recently checked with several banks, and not even for their top customers are they offering anything like 4%, alas. Typically, top tier customers can earn an extra 1/2% os so, but not much more. Maybe if you have a few hundred million lying around, it is different. But for the odd Bt. 800K, nothing.