Neighboring countries compete with Thailand for foreign retirees

[reader]

From Pattaya Mail

By Barry Kenyon

Thailand offers a multiplicity of long-term visas for women and men well past the first bloom of youth. They include annual extensions of stay, the 5-20 years Elite visa and the 10 years Long Term Residence (LTR), each of which has its own scale of charges with assorted pluses and minuses. None of them allows direct ownership of land by foreigners, nor guarantees a path to permanent residency or citizenship. Purchase of condominiums is allowed but does not generally result in visa concessions. Since January 2024, anyone spending six months or more in the kingdom may be liable to personal income tax on remitted income.

Malaysia has had a 5-20 years My Second Home program since 2002 but there have been a succession of changes, including the requirement to purchase and retain a property and associated land (100 percent in their name) in order to spur growth in the local market. Perks include obtaining visas for spouses, parents and children under 34 years. Unlike Thailand, Malaysia imposes the requirement to live in the country for at least three months per year, although a dependant relative can substitute where the visa holder is still of working age. Malaysia is not currently insisting on foreign tax residents paying tax on remitted income from abroad.

Cambodia seems to have abandoned an earlier second home campaign, but the Retirement ER visa gives one year which is annually renewable. Retirees aged at least 55 years do not need to provide written proof of status or finances. Property ownership laws are strict and similar to Thailand’s. In theory, Cambodia requires foreign residents to file and pay taxes on their foreign income, but there are few signs of enforcement for this kind of visa. Cambodia allows foreigners to purchase citizenship provided they invest or donate US$300,000, an offer taken up with alacrity by rich Chinese in particular.

The Philippines offers a Special Resident Retirement Visa (SRRV) which offers a renewable two-year permanent residence ID card. Those over 35 years must deposit US$50,000 in a Philippine bank (less for pensioners), which can later be used to help buy a condominium unit, and show proof of a monthly income. Remitted cash from sources outside the Philippines is not subject to tax. Foreigners can lease land for 50 years with extensions for 25 years more. The Philippines are unique in the region for granting a notional permanent residency from day one of the SRRV.

It follows that the issues for longstay retirees in the region vary country by country. None offers the kind of dual citizenship or second passport which are common in permanent residence visas throughout the Caribbean for instance. Malaysia and the Philippines offer favorable tax conditions for foreign retirees, although Thailand offers a range of tax privileges in the Long Term Residence detail. Property ownership remains problematical across the region, although the purchase of condominiums or long-term leases is common. Use of local nominees to buy property or to conduct business is extremely risky throughout south east Asia. Cambodia probably offers the easiest bureaucratic route to longstay retirees, but the country lacks the kind of infrastructure westerners are used to. There are no sure answers, just individual preferences and priorities.

[TMax]

I'm not 100% certain but I believe they scrapped the 35yo bit and the age (suspended indefinitely and not reinstated) now is 50 and above, the PRA website says 50yo.

[TMax]

Quote

The Philippines offers a Special Resident Retirement Visa (SRRV) which offers a renewable two-year permanent residence ID card. Those over 35 years must deposit US$50,000 in a Philippine bank

Make that 100% certain now, the 35yo SRRV was canned because (apparently) so many Chinese were getting it and working in the illegal Philippine Offshore Gaming Organisations (POGOS). The SRRVs for over 50's is still in play, the one I looked at and would consider in the future is the SRRV Classic, US$ 20,000 in a term deposit for 12  months after which it can either be withdrawn for use in a condo purchase / condo renovation or leave it in and get a very small interest rate on it. 

[unicorn]

Wow. Thailand's laws sound hostile to those who seek permanent residency there. There are many countries which are far more welcoming. Certainly, the Philippines seems to be one, but there are many more in other regions, including Belize and Portugal, where my sister has obtained permanent residency and soon citizenship. Portugal also has good infrastructure and healthcare. You'd think a country would be happy to have foreigners spend their hard-earned pensions there, rather than be assholes about it. Where does this hostility come from? Xenophobia?

[floridarob]

4 minutes ago, unicorn said:

There are many countries which are far more welcoming

As I've mentioned, I looked at Thailand and Mexico, made a pros/con list...Immigration was a big consideration. Once you have Residency in Mexico, that's it, only interaction with immigration is to update your address if you move. After 5 yrs as a resident , you can apply for citizenship and if you're over 60, even an easier process. Plus is soo much much closer to go to USA....

And not to forget Vinapu's wise words....If you live in Thailand, you can't look forward to "visiting" Thailand 👑

[TMax]

In the Philippines you can live there on a tourist visa for 36 months, you just have to keep extending it but must leave once just before 36 months is up then return and start all over again (even leave for just one day). Although now they are getting a bit stricter and interviews are now part of the long term extension process (mainly thanks to the people abusing the tourist visa extension process, re my post above), still not that hard but just a bit more complex.

[bkkmfj2648]

4 hours ago, unicorn said:

You'd think a country would be happy to have foreigners spend their hard-earned pensions there, rather than be assholes about it. Where does this hostility come from?

@unicorn this is an excellent question.

I am coming up on my 2 year anniversary as a retired expat living in Thailand (Jomtien).

My feeling from living here 2 years is that I don't believe that this hostility comes from xenophobia, but more from the fact that Thailand was never colonized and went out of its way to avoid being colonized during its long history.  Consequently, I believe that there is a fear to give us foreigners any rights in Thailand to avoid the fear of feeling to be colonized by us foreigners.  You see this in the draconian way that foreigners are not allowed to own land in Thailand - Thailand will resist at all cost the idea that foreigners could take over Thailand.

However, Thailand likes to make us feel good in Thailand and loves to take our money via tourism and to accept us as retired expats - as this is one of the many ways that Thailand acquires foreign currency and helps the GDP.

In my opinion, it is like a "safe" way for Thailand to get what Thailand wants from us without having to give up anything physical in return.

Thoughts ? 🤔

[reader]

Agree with conclusion about colonization. However, China has never given up on it's intent to make Thailand a client state by any means possible, much in the same way it has Cambodia and Myanmar. Its methods are diverse but the goal doesn't waiver. As you say, Thailand is well aware of the efforts. I, too, do not believe it's xenophobia but a necessary paranoia.

 

[Keithambrose]

10 hours ago, reader said:

Agree with conclusion about colonization. However, China has never given up on it's intent to make Thailand a client state by any means possible, much in the same way it has Cambodia and Myanmar. Its methods are diverse but the goal doesn't waiver. As you say, Thailand is well aware of the efforts. I, too, do not believe it's xenophobia but a necessary paranoia.

 

Quite right. Chinese are already slowly encroaching  into Thailand,  and will certainly  not give up. If necessary,  thick, and thicker, brown envelopes  will be deployed. Thailand is a much bigger, and more developed, economy than Lao or Cambodia,  and was not devastated by civil war, but that makes it an attractive  target for China.itonicallybtge various laws that are seen to bexanti farang, are a useful buffer. However, they may not be enough.

[unicorn]

11 hours ago, bkkmfj2648 said:

@unicorn this is an excellent question.

I am coming up on my 2 year anniversary as a retired expat living in Thailand (Jomtien).

My feeling from living here 2 years is that I don't believe that this hostility comes from xenophobia, but more from the fact that Thailand was never colonized and went out of its way to avoid being colonized during its long history.  Consequently, I believe that there is a fear to give us foreigners any rights in Thailand to avoid the fear of feeling to be colonized by us foreigners.  You see this in the draconian way that foreigners are not allowed to own land in Thailand - Thailand will resist at all cost the idea that foreigners could take over Thailand.

However, Thailand likes to make us feel good in Thailand and loves to take our money via tourism and to accept us as retired expats - as this is one of the many ways that Thailand acquires foreign currency and helps the GDP.

In my opinion, it is like a "safe" way for Thailand to get what Thailand wants from us without having to give up anything physical in return.

Thoughts ? 🤔

My thoughts would involve wondering why, with the information given in the original post, one would want to retire in Thailand rather than in the Philippines or somewhere else entirely. In Thailand, it sounds as though one gets double-taxed, probably can't get real permanent residency status or citizenship, can't own property, and I'd have to learn an entirely new writing script, adapt to driving on the left, and so on. Probably things are no more expensive in the Philippines than in Thailand. My sense, especially from reading this forum, is that one can even express oneself more openly in the Philippines (I keep seeing references to "He who cannot be named," and to lèse-majesté laws when it comes to Thailand). 

I'm completely baffled as to why anyone would choose Thailand over the Philippines to retire, except perhaps someone coming from a country in which one drives on the left side who doesn't want to adapt to a different driving style. I'd be curious to hear any rationale as to why someone would pick Thailand over the Philippines or somewhere else less hostile to foreigners spending money there. 

[bkkmfj2648]

3 hours ago, unicorn said:

I'm completely baffled as to why anyone would choose Thailand over the Philippines to retire

@unicorn I am about to start this journey - where to retire (even though I already retired to Thailand in September 2022).

One of my primary decisions for choice of retirement country that I made in 2020 was based on favorable tax treatment - which Thailand scored as being very tax friendly.

Then the Thai Revenue Department amended one of the existing regulations on the treatment of "assessable income", which came into force effective 01-Jan-2024.

Consequently, I will start 2 exploratory trips to The Philippines and also to Vietnam to see if the grass is any greener there for a retiree - especially from a tax treatment point of view.

Regarding The Philippines, I have zero experience and @unicorn if you could suggest to me any Philippine cities that are attractive and on the sea like Jomtien is - I would appreciate it.  I will start my exploration in Cebu City (skipping the Manila metro area - for the same reasons that I could not live in Bangkok).

Regarding Vietnam, I have been a couple of times and my heart is set on Da Nang - as I see it being very similar to Jomtien but in a environmentally cleaner way with excellent access to beautiful nature.  However, the gay infrastructure in Da Nang is miniscule when compared to Jomtien - Pattaya - but it does have around 3 gay bars and perhaps a half a dozen gay massage shops.

@unicorn when you say why someone would choose Thailand as a gay retirement destination - my main reasons were:

• the appeal of the gay infrastructure (bars and clubs) that exists here in Jomtien and Pattaya,
• access to the beaches.  Now after living here for 2 years that appeal has diminished because of pollution and dirty sea water - although one can take the 1 hour journey (elapsed time from when you leave your condo until you put down your beach towel) over to Koh Larn where the beaches on the west side of the island are still beautiful,
• access to great local health care.

Unfortunately, the excitement of the gay entertainment wears off and becomes banal.  The local gay life is GREAT when you are here on vacation, but when you live here full time it gets kind of boring and mundane - especially during the low seasons when the local guys get desperate financially and react accordingly - which creates a negative environment - until the next high season arrives.

So, I would still argue that retiring in Thailand still has its appeal - but alternate places should be considered.

[vinapu]

7 hours ago, unicorn said:

 

I'm completely baffled as to why anyone would choose Thailand over the Philippines to retire, 

People look for different things and consider them of higher or lesser importance, be it property ownership , climate, sound of spoken language and everything in between.

I'm baffled why anyone would chose Pattaya over Bangkok and still thousands do heading to Pattaya right from Swampy day and night

[unicorn]

4 hours ago, bkkmfj2648 said:

...Regarding The Philippines, I have zero experience and @unicorn if you could suggest to me any Philippine cities that are attractive and on the sea like Jomtien is - I would appreciate it.  I will start my exploration in Cebu City (skipping the Manila metro area - for the same reasons that I could not live in Bangkok)...

Well, the Philippines is one country I've never visited. Someone considering moving there might consider contacting one of the organizations mentioned in this webpage:

https://en.wikipedia.org/wiki/LGBT_culture_in_the_Philippines

I'm not recommending the Philippines out of personal experience (although I do have a number of straight acquaintances from there, and know that one of my fellow physicians was happy retiring there). It just seems from the OP, the Philippines are much more welcoming to foreign retirement than Thailand. I'd be especially turned off by the Thai policy of double-taxing the money I'd be spending there already.

[vinapu]

16 minutes ago, unicorn said:

Philippines are much more welcoming to foreign retirement than Thailand. I'd be especially turned off by the Thai policy of double-taxing the money I'd be spending there already.

One may be  very surprised upon settling in the Phillippines that their tax rules re foreign income of residents mirror those of Thailand and Indeed most of countries of note in the world who usually have tax treaties between themselves and treat those issues quite uniformly with income taxed in another country either exempt in another one or tax credit given for tax already paid in that thay call " other contracting state "

As advised many times here,  instead of being heated about those issues , time is better spend studying tax treaty between counties of interest as variations do exist.

From what I get Thai rules are nothing new, rather thay decided to implement what is in the books already.

Look at it the same way as one would about mandatory helmets on motorbike. Imagine outcry if all of the sudden new PM ordered police to enforce it strictly and without exception even for short hop.

[bkkmfj2648]

2 hours ago, vinapu said:

I'm baffled why anyone would chose Pattaya over Bangkok and still thousands do heading to Pattaya right from Swampy day and night

And I have the opposite "baffle" from you - as to why anyone would want to retire and live out the last years of their lives in a crowded, dirty, congested, noisy, smelly, no access to the beach city like Bangkok.

I am from New York, and when the company that I worked for in 1987 decided to open a new small 5 person office in Denver, Colorado - I begged and begged all of my supervisors and chiefs to be one of the 5 employees assigned to Denver.  I was miserable in NYC with all of the above listed negative descriptors for Bangkok in NYC and Denver gave me access to a smaller mid-size city with amazing access to beautiful nature with stunning views of the Rocky Mountains from downtown Denver.

I knew then, all the way back in 1987, that I could never live again in a big mega city like New York, Bangkok, Manila, Jakarta, etcetra.

I just had to have a connection to nature and after living in Colorado for 12 years, I realized that I also needed access to the sea - so, hence my attraction to a coastal city like Jomtien - Pattaya for my retirement years.

Every morning when I wake up - I see the beautiful Gulf of Thailand from my bed and it is truly amazing the vastness of the sea (gulf).

--> however, just don't walk or swim in the coffee brown beach water - but just look beyond that for the illusion of peace and tranquility....

[bkkmfj2648]

1 hour ago, vinapu said:

From what I get Thai rules are nothing new, rather thay decided to implement what is in the books already.

This may be open for interpretation.  After investing many hours in this issue and attending many seminars about it, it seems that Thailand is moving:

• from a Territorial Tax System,
• to a Residence-Based Taxation System,
• with talks of possibly adding additional elements of a Global (Worldwide) Tax System.

Territorial Tax System countries are very appealing to us (retirees) whose income is earned outside of said territory - as the local government tends to not care about our earnings outside of said territory.

Interestingly, I asked the Microsoft Copilot (I am not sure which LLM AI engine it uses) to list which countries adhere to the Territorial Tax System and it still lists Thailand and in my opinion, this is incorrect, because as of 01-Jan-2024 due to the change announced by the Thai Revenue Department on 15 September 2023 (No. Paw. 161/2566) regarding assessable income brought into Thailand for "tax residents".

 

So, as we can see this Territorial Tax System country list is shrinking as the world moves towards these more inclusive tax regimes.

 

[KeepItReal]

I am broadening my thinking and reconsidering if I should look beyond my planned 2nd home in Asia. Frankly, I really enjoyed my time in Cape Town, South Africa. Tax laws are fairly friendly and property is relatively cheap while the dollar is strong.  Watching some YouTube videos about how it works and experience from those who have done so at the moment. 

[vinapu]

17 hours ago, bkkmfj2648 said:

And I have the opposite "baffle" from you - as to why anyone would want to retire and live out the last years of their lives in a crowded, dirty, congested, noisy, smelly, no access to the beach city like Bangkok.

 

Exactly for numerous reasons you listed above. It's called city life, not for everybody I agree but must have some spell since 10 million lives there

[vinapu]

17 hours ago, bkkmfj2648 said:

 

 

 

So, as we can see this Territorial Tax System country list is shrinking as the world moves towards these more inclusive tax regimes.

 

There's logic in it as one lives and consumes tax funded resources in the country without contributing to the till.

At end if day we should  remember that taxation is not about fairness, is about extracting money from general population.

[vinapu]

8 hours ago, KeepItReal said:

I am broadening my thinking and reconsidering if I should look beyond my planned 2nd home in Asia. Frankly, I really enjoyed my time in Cape Town, South Africa. Tax laws are fairly friendly and property is relatively cheap while the dollar is strong.

And crime almost non existing

[unicorn]

3 hours ago, vinapu said:

There's logic in it as one lives and consumes tax funded resources in the country without contributing to the till...

If you think that remittances don't contribute to the till, you're deeply mistaken. Foreign cash coming into a country's economy forms an integral part of the economy of many countries (most notably the Philippines). Money spent by foreigners can very much stimulate a country's economy.

https://en.wikipedia.org/wiki/Remittance

"...Remittances make up a significant portion of economies of developing countries. Many receive over 10% of their gross domestic product (GDP) in remittances each year, with some exceptional cases as high as a third of their GDP...". 

[vinapu]

51 minutes ago, unicorn said:

Money spent by foreigners can very much stimulate a country's economy.

To the same extend local's Piso or baht stimulates economy. And those locals ,   on top  of their stimulation by spending ,  are paying their taxes some resident foreigners are trying so laboriously avoid

[Keithambrose]

16 hours ago, KeepItReal said:

I am broadening my thinking and reconsidering if I should look beyond my planned 2nd home in Asia. Frankly, I really enjoyed my time in Cape Town, South Africa. Tax laws are fairly friendly and property is relatively cheap while the dollar is strong.  Watching some YouTube videos about how it works and experience from those who have done so at the moment. 

Cape Town used to be very violent,  with people living behind barbed wire fences, and signs saying, 'Armed response team in 5 mins'. In our boutique hotel, in a leafy suburb on the way up to Table Mountain, we were advised not to walk 1km to a restaurant,  too dangerous  they said. The 'township', nearby, which  had over one million people, was heartbreaking. Our black waitress, who lived there had sent her 5 year old daughter away, as she was worried  that she would be raped! Her husband  had been murdered.  Have things changed?

[reader]

Double taxation was at the root of that scuffle the north America colonists had with the British circa 1776.

I pay taxes to my town, my state and my country. That seems enough.

[bkkmfj2648]

14 minutes ago, reader said:

I pay taxes to my town, my state and my country. That seems enough.

Thank you @reader for writing what you wrote above.

And if you are a USA citizen, then you are also taxed back in the USA and can also be taxed in your host retirement country - depending on the tax regime that said host country has implemented.  Yes, there is the DTA to help you out - but that in of itself is another bureaucratic nightmare, and is not always a net sum zero result.  Someone loses and that is generally you = the global tax citizen.  DTAs can be fair when your home country tax scale and allowed deductions are similar to your host country tax scale and allowed deductions.  Guess what - they are not.

And if you had the joy for working for the UN - then there is another additional separate tax regime to worry about.