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Thailand Double Taxation

Discussion in 'Teaching overseas' started by Thormaturge, Jan 25, 2008.

  1. Thormaturge

    Thormaturge New commenter

    A small number of schools in Thailand do not deduct tax from their teachers for the first two years due to the provisions of the UK-Thailand Double Taxation treaty.

    A new treaty is likely to be ready by 31st March, 2008 and will almost certainly apply in Thailand from 1st January, 2008.

    At present there is no guarantee that British teachers will continue to enjoy tax exemption under this new treaty so either inform your school of this, or set aside some money to cover the tax if the exemption is withdrawn
     
  2. Thormaturge

    Thormaturge New commenter

    A small number of schools in Thailand do not deduct tax from their teachers for the first two years due to the provisions of the UK-Thailand Double Taxation treaty.

    A new treaty is likely to be ready by 31st March, 2008 and will almost certainly apply in Thailand from 1st January, 2008.

    At present there is no guarantee that British teachers will continue to enjoy tax exemption under this new treaty so either inform your school of this, or set aside some money to cover the tax if the exemption is withdrawn
     
  3. percy topliss

    percy topliss Occasional commenter

    Mate I worked in Thailand for four years and never paid a bean! (legally)
     
    max5775 likes this.
  4. How can they backdate it to January if this new Treaty isn't even ready or legal yet? This is the first I've heard of it. I don't pay tax.

    JP
     
  5. Thormaturge is right to sound a warning. The Thai authorities can do what they like as far as tax is concerned. The danger for teachers lies far more in the fact that schools either don't - or won't - understand the rules. It's very easy to get caught. Be very careful. If you are going to interview for any school in Thailand in the next few weeks, ask what they know and get their intended actions in writing before you sign up.

    Bill and Ben
     
  6. Thormaturge

    Thormaturge New commenter

    The new agreement is expected to be finalised by 31st March, and until then we cannot be sure as to the contents of the new agreement, but the OECD model agreement does not contain a teaching exemption anymore.

    Ordinarily Thai schools deduct tax and people reclaim anything overpaid at the commencement of the new year. This is one reason why.

    I do agree that the tax situation in Thailand is in a muddle, fuelled partly by misconceptions and rumour. People are obtaining refunds, however, and the situation is gradually being normalised.

    Obviously I cannot advertise on here but those who are concerned may choose to ask around teachers at some of the "saint" schools, especially the Boxing Day one, for someone who can put them in touch with a tax advisor. You'll probably wind up speaking to me.
     
  7. My tax liabilities are complex but the ILR sayy that if I am out of the UK for most of next year/ I can claim all of my of-sets and pay only my liabilities over £25000.

    My oversea earnings will be deducted at 80% and my UK earnings will be taxed at domisaile rates
     
  8. For the first year \i will have to pay 20% tax on my UK earnings and nothing on my overseas earnings

    During the second year, I will have to pay normal tax overseas and I can ofset it against my UK earnings

    Should leave me tax free on my second and third year. no gratuaty
     
  9. Thormaturge

    Thormaturge New commenter

    ^
    Which is why people should always take advice that is independant of HM government.

    If your work overseas will span a complete tax year then you should be regarded as non-resident from the day of departure using "split year treatment".

    There should be no UK tax on your overseas earnings whatsoever.

     
  10. Thormaturge

    Thormaturge New commenter


    I have today heard from the UK-Thailand Tax Treaty team that the new agreement is still not ratified and will not therefore take effect until 1st january, 2009 at the earliest.

     
  11. Thormaturge

    Thormaturge New commenter

    Here we are a full year later and still no new treaty. This is good news in a way since it does mean the 1981 treaty continues in force and therefore the exemption is still in place, at least until January.




     
  12. So, when I move to Thailand in August, does this mean I won't be paying tax?
    Apologies if that was a bit of a naive question....newbie and all that.
     
  13. As I understand it, we will pay tax, and then with any luck our lovely schools will help us reclaim it, which won't be for at least a year (I think). You need to have two original (not photocopies) letters from the UK tax people stating your tax paying status over the last two years to go through the process as far as I understand. if you phone the overseas tax office in Liverpool, they are really nice and will send you this.
     
  14. Thormaturge

    Thormaturge New commenter

  15. MisterMaker

    MisterMaker Occasional commenter

    I can't be bothered to read the weblink he gave; if you think it's advertising just report him for abuse. There was a chap who was advertising his website who posted on this forum several times a few months ago; I reported him and feel no shame for it.
    My own contributions have been removed so often I don't feel any remorse for those who should be removed for advertising. This is especially true if they are financial folk - awful people who pester you non stop as soon as they get their grubby hands on your contact details.
     

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