Is Thailand planning to tax overseas pensions for foreigners, and what are the implications?

Nov 21, 2024
a month ago
Lawrie *******
ORIGINAL POSTER
I have heard on the 'grapevine' that the Thai is either now or in the near future planning to tax pensions from overseas and any lump sum payments to whoever in Thailand for 'Farangs' (hate that word should have said foreigners).

I heard that the tipping point for this taxation is stays of over 180 days in the kingdom in a calendar year, and would most probably impact long-stay, retirement and married-to-Thai foreigners.

Any truth to this rumour and if so to what extent and what are the implications? It seems that the money in a bank account is already a significant implementation to long stay.visas in Thailand.

Please just genuine knowledgeable responses.
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TLDR : Answer Summary
Recent discussions have emerged about Thailand potentially taxing pensions from overseas for foreigners, especially those staying longer than 180 days in the country. While there are rumors, it seems this taxation is becoming an official rule set to take effect in 2024. This would primarily affect long-stay retirees and foreigners married to Thai citizens. Many participants in the discussion emphasize the importance of consulting an accountant to navigate the complexities of the new tax regulations, especially given the existence of dual taxation treaties which may afford some exemptions depending on one's country of origin.
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Rich ********
Your country's treaty or lack of may have an effect. For example the tax treaty between Thailand and the United States is designed to prevent double taxation and fiscal evasion concerning taxes on income. Here are some key points about the treaty:

1. **Residency**: The treaty provides guidelines to determine residency, which affects the taxation of individuals and entities. Generally, residents of one country are taxed only in that country for certain types of income.

2. **Types of Income**: The treaty specifies how different types of income are taxed. Common categories include:

- **Dividends**: Typically, dividends paid from a company in one country to a resident of the other are subject to reduced withholding tax rates.

- **Interest**: Interest income may also be taxed at a reduced rate or exempt from taxation, depending on specific conditions.

- **Royalties**: Similar provisions apply to royalties, allowing for reduced withholding taxes.

3. **Employment Income**: Income from employment is generally taxed in the country where the work is performed. However, there are exceptions for short-term assignments or specific conditions that allow for taxation only in the employee's home country.

4. **Pensions and Annuities**: The treaty outlines how pensions and annuities are treated, often allowing taxation in the country of residence of the recipient.

5. **Elimination of Double Taxation**: Both countries provide methods to eliminate double taxation. The United States allows for a foreign tax credit for taxes paid to Thailand, while Thailand may provide exemptions or deductions for taxes paid to the U.S.

6. **Exchange of Information**: The treaty includes provisions for cooperation between the two countries in terms of tax information exchange, aimed at preventing tax evasion.

7. **Non-Discrimination**: The treaty includes clauses that prevent discrimination against residents of one country by the other, ensuring equal treatment under the law.

It's advisable for individuals or businesses with tax implications in both countries to consult with tax professionals who are knowledgeable about the specific provisions of the treaty and how they apply to their circumstances.
Kim *********
@lawrie Smith well you did say foreigner when you wrote farang since that is what it means. So hating the word is kind of ridiculous
Mike ********
There's loads of videos on you tube if you simply search "Paying Tax in Thailand" becomes in play January 1 2025.No need for panic although there is an existing law it may well be "reviewed" due to backlash from Expats and unsurprisingly many Thais who benefit from our existence,paying rent etc.Take note of available deductibles,Age,married to a Thai,quite a list
Michael *******
@Mike *******
except it’s not being driven by Thailand but the OECD and the US especially, they want to remove tax bolt holes like thailand - I would rather they follow Dubai, and tax consumption
Brian *********
In truth Farang is not all inclusive as a translation to Foreigner. There’s a bit of racism at its core. 😉
Andy ************
@Brian ********
Oh dear. Always someone playing the racism card! 😂
Kim *********
@Brian ********
that's your interpretation
Brian *********
@Kim ********
no, it’s not my interpretation in any way shape or form. It’s the result of careful questioning over numerous situations. So no. Sorry.
Kim *********
@Brian ********
well it means white people and that's what we are. Said without malice no problems. If used deliberately in a negative way then yes a problem bordering on racism. No problem of course that we disagree 😊
Brian *********
@Kim ********
I think we’re in the same neighborhood. I don’t think you grasped my comment was extremely clear. “In truth Farang is not all inclusive as a translation to Foreigner.”

And now you just basically agreed that what I said is true!

“There’s a bit of racism at its core. 😉”

Calling white people Farang and calling virtually anyone else from somewhere else something else is by definition a form of racism.

That’s not an interpretation.

I remember seeing severe confusion when trying to explain Elon Musk is from South Africa. That is an education thing, clearly.

Anyway, healthy discussion. 👍
Kim *********
@Brian ********
that's not what I agreed to since it depends on the intention of the one using it and how. It means white people - nothing racist in that. So if we say black people you consider that racism - I don't. The definition is prejudice discriminating antagonism. That is not present in being called farang which we are. As I said if used with intentional malice it's another matter. In it's core to use your terminology it is not racism but a statement of the obvious. But enough of this.
Michael *******
If you are here more than 180 days in a calendar year you become tax resident, and remittances during that tax year are subject to Thai income tax effective 2024 so our first returns are due by end Mar 2025 - allowances are generous and if you from a country that has a DTA unlikely you will pay any tax here. If you can prove income is pre 2024 then large amounts for property or car purchase are also exempt. An accountant will handle tax return from B8k upwards.
Andy ************
@Michael ******
Or if you can show you are a dual tax resident with a permanent home in another country in which you also have tax residency
Rok ********
It is a law already yet not enforced; Remittance based only but only a matter of time to move to the worldwide income and assets principle.
Peter **********
You make it sound like this is a secret. This has been known for a long time and is official but it’s not as black and white as you say.
Henrik *****
Henrik *****
Henrik *****
Eddy ********
Personally I have no problem being referred to as a Farang. Up to them.
Pete *******
It’s always been the case that once tax resident you are subject to Thai tax law. Pensions are assessable income unless exempted by a DTA and subject to Thai tax law. Nothing new.
Neale *********
Probably best asking a Thai accountant
Marty *********
You become a tax resident in Thailand if you are in Thailand for 180 days. Starting in 2024, money brought into Thailand is taxable. It is hard to say what this means until Jan-Mar when we can see the Thai tax forms. Thailand has dual tax treaties with many countries. For US citizens federal pensions such as Social Security are not taxable in Thailand. You would have to check the tax treaty details for your country.

If you have a pensioner LTR visa then money you bring into Thailand is not taxable.
Pete *******
@Marty ********
not true, money bought into Thailand prior to 2024 was always taxable depending on the source of those funds. Money brought into Thailand after 2024 is only taxable if you meet certain qualifying criteria. Taxation or otherwise is always based on unique personal situations.
Peter **********
its not a rumour, its now law and active
Will ************
Certainly everything is now possible as Thailand has signed up to CRS , meaning they have access to your bank accounts, income and tax returns elsewhere in the world. They don’t need to have new rules they are only enforcing existing ones.
Andy ************
@Will ***********
Not quite true. The exchange is only in relation to your name, identifier, account balance at end of tax year and interest/dividends paid. They don't have "access to your bank accounts". That would be a gross violation of privacy and is against international treaties
Gerald ********
Have a look at this site and also they do a free 15 call for free to talk about your tax
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