Updates on overseas remittances and income tax

reader · January 16

From Pattaya Mail

By Barry Kenyon

A packed meeting of Pattaya City Expat Club heard updates about the controversial Thai Revenue Department policy as regards overseas income transmitted to Thailand. The two invited representatives of American International Tax Advisers Co. were director Thomas Carden and tax attorney Patcha Inkudanonda who was in regular touch with local revenue authorities.

Patcha explained that some expats were not required to obtain a Thai tax identification number or fill in a tax return. These were foreigners present in Thailand for less than 180 days in the calendar year 2024, those who had not transmitted cash from abroad, those who had transferred only income they had earned up to 31 December 2023 and holders of the 10-year Long Term Residence (LTR) Visa.

For other expats the general advice was to obtain a tax number and submit a tax return by the end of March 2025. There was no need to attach documentation, but she reminded the meeting that all foreign income should be totalled, though declaration did not automatically mean liability to pay tax. In breaking news, the Thai Revenue Department had very recently clarified that use of a foreign credit card to obtain Thai baht was now included in the definition of income.

Answering questions, Mr Carden said that the Thai government had promised to honor double taxation treaties with 61 countries. However, these were all unique and could not be used as some kind of blanket immunity. He suggested that an expat should refer to the applicable terms in the submitted tax form by way of a caveat or alert. Mr Carden several times stressed that the government was deliberately widening the income tax base, but accepted that small fish were being caught in the net designed for bigger ones, especially rich Thais.

Other questioners asked for clarification about investment transfers. For example, was an overseas transfer to purchase a Thai condominium necessarily taxable? Mr Carden said the matter had not yet been fully clarified. He also admitted that use of foreign credit cards to purchase goods in Thailand was another awkward subject and one difficult to monitor by tax authorities. It was obvious, said Mr Carden, that the Thai Revenue Department was making some rulings as the policy moved along.

Some members wondered how the Revenue would track the finances of so many individuals. Patcha pointed to the Global Forum on Transparency and Exchange of Information for Tax Purposes which basically meant that international banking details would be available if the Thai authorities made the request. Both she and Mr Carden were concerned that expats choosing to ignore the entire issue now could be subject to audit later. At that point, they would need to justify non-filing. The key takeaway point from the meeting was to retain records of all financial transactions involving foreign cash.

https://www.pattayamail.com/latestnews/news/pattaya-expats-receive-updates-on-overseas-remittances-and-income-tax-487289

khaolakguy · January 16

9 hours ago, reader said:

From Pattaya Mail

By Barry Kenyon

A packed meeting of Pattaya City Expat Club heard updates about the controversial Thai Revenue Department policy as regards overseas income transmitted to Thailand. The two invited representatives of American International Tax Advisers Co. were director Thomas Carden and tax attorney Patcha Inkudanonda who was in regular touch with local revenue authorities.

Patcha explained that some expats were not required to obtain a Thai tax identification number or fill in a tax return. These were foreigners present in Thailand for less than 180 days in the calendar year 2024, those who had not transmitted cash from abroad, those who had transferred only income they had earned up to 31 December 2023 and holders of the 10-year Long Term Residence (LTR) Visa.

For other expats the general advice was to obtain a tax number and submit a tax return by the end of March 2025. There was no need to attach documentation, but she reminded the meeting that all foreign income should be totalled, though declaration did not automatically mean liability to pay tax. In breaking news, the Thai Revenue Department had very recently clarified that use of a foreign credit card to obtain Thai baht was now included in the definition of income.

Answering questions, Mr Carden said that the Thai government had promised to honor double taxation treaties with 61 countries. However, these were all unique and could not be used as some kind of blanket immunity. He suggested that an expat should refer to the applicable terms in the submitted tax form by way of a caveat or alert. Mr Carden several times stressed that the government was deliberately widening the income tax base, but accepted that small fish were being caught in the net designed for bigger ones, especially rich Thais.

Other questioners asked for clarification about investment transfers. For example, was an overseas transfer to purchase a Thai condominium necessarily taxable? Mr Carden said the matter had not yet been fully clarified. He also admitted that use of foreign credit cards to purchase goods in Thailand was another awkward subject and one difficult to monitor by tax authorities. It was obvious, said Mr Carden, that the Thai Revenue Department was making some rulings as the policy moved along.

Some members wondered how the Revenue would track the finances of so many individuals. Patcha pointed to the Global Forum on Transparency and Exchange of Information for Tax Purposes which basically meant that international banking details would be available if the Thai authorities made the request. Both she and Mr Carden were concerned that expats choosing to ignore the entire issue now could be subject to audit later. At that point, they would need to justify non-filing. The key takeaway point from the meeting was to retain records of all financial transactions involving foreign cash.

https://www.pattayamail.com/latestnews/news/pattaya-expats-receive-updates-on-overseas-remittances-and-income-tax-487289

I think that there was a significant word missing in this sentence.

"It was obvious, said Mr Carden, that the Thai Revenue Department was making up some rulings as the policy moved along."

reader · January 18

From Pattaya Mail

EDITORIAL

Pattaya Mail’s recent report of an expat club meeting about potential tax charges on income remitted to Thailand since January 2024 was quickly copied (with cosmetic changes) by several other news sources plus heated comments. If there was any doubt before, there’s none now: this is the number one concern of the expat community in Thailand, particularly the 250,000 or so retirees and non-working long stayers. There are several well-publicized armed camps, sometimes overlapping, which compete for your support.

A very vocal group are the “Not on your life” adherents. They say they didn’t come to Thailand to share their pre-taxed pensions with the Thai Revenue Department (TRD) and won’t do a thing unless, or until, tax officials turn up of their doorstep. They also doubt whether TRD has the resources to check up on everybody, a belief that is potentially optimistic given the ever-expanding computerization of records and the future impact of artificial intelligence.

A second group, often better informed than the first, are the “It’s all exaggerated” adherents. They examine some of the detail but say modest earners need not get involved. They argue that there has been no actual change in the law and that foreign “experts” in Thailand have blown the whole matter out of proportion to encourage pensioners and others to join up and open their wallets. Foreigners shouldn’t be giving legal advice anyway as that’s banned under the alien employment legislation. One problem with this comforting overview is that native Thai lawyers and tax accountants are themselves divided on the whole subject. Tax matters are often open to interpretation.

Then there are the “Double taxation treaty” discounters. They point to these agreements as generalized excusals that mean foreign nationals from 61 countries are immune from further reporting if they transmit funds to Thailand. However, an alternative interpretation is that the notoriously complex treaties do not bestow automatic exemptions but, in order to be activated, require reference or caution when an income tax form is actually submitted.A fourth group, “Foot in the water” supporters say the best thing to do now is to apply for a tax identification number (tin) from your local revenue office, but not actually send in a tax return. In this way you have met the tax authorities half-way, so to speak, in case of audit problems later. There is, of course, nothing illegal in having a tin and not submitting a return, though you are actually confirming to the TRD you have nothing to declare for that particular year. But some say that registering without needing to simply brings you to official attention.

A fourth group, “Foot in the water” supporters say the best thing to do now is to apply for a tax identification number (tin) from your local revenue office, but not actually send in a tax return. In this way you have met the tax authorities half-way, so to speak, in case of audit problems later. There is, of course, nothing illegal in having a tin and not submitting a return, though you are actually confirming to the TRD you have nothing to declare for that particular year. But some say that registering without needing to simply brings you to official attention.

A fifth group “Sure is better than sorry” advocates submitting a tax form unless you are sure you have no tax liability from foreign income remitted to Thailand in a particular year. Supporters of this view say doing nothing now could expose you to audit in later years with fines and even deportation being possible if you have erred in the past. Critics of this stance say that theoretical rules in Thailand are frequently ignored. For example. most Thai nationals do not fill in a tax form and don’t intend to irrespective of the source of funds. TRD is a bogeyman to foreigners but not to your average Thai national. Listen to the locals.

Pattaya Mail is not qualified to give tax advice to individuals. The likelihood is that there will be a spike in TRD registrations by panicky foreigners in March 2025, the final month to submit the tax form and any tax due for the calendar year 2024. Announcements by the TRD, if any, in the next few weeks could upend the whole debate. In the meantime, there is always the option of speaking to a Thai tax lawyer about your personal circumstances, several of whom offer free consultations as mentioned from time to time on our news website. Or maybe the income tax issue is akin to extensions on the Destination Thailand Visa: the rules are subject to the interpretation of the officer dealing with your particular case. As Bernard Trump used to say: TIT or This Is Thailand.

https://www.pattayamail.com/latestnews/news/foreigners-and-income-tax-take-your-pick-487470