British Tax office require a proof of living in Thailand. WHERE?

[Admin]

British Tax office require a proof of living in Thailand.
WHERE?

Someone said the letter need to be issued by the Tax office in Thailand because there is an agreement between the UK & Thailand but I would think the letter for the Tax office in the UK should be issued in the British embassy!
*For a non working foreigner living in Thailand.
Help please.

[Prakhonchai Nick]

An interesting item ADMIN, but in what connection?

[Admin]

An interesting item ADMIN, but in what connection?

I don't know exactly. A guy asked me because the Tax office in England asked him to do so and the Tax office in Buriram doesn't understand what exactly he needs.
All of this request is really sound illogical. I tried to call the British embassy but they said they have no clue and suggested to recheck again with the British Tax office in London.
They said they do not issue letters showing proof of living in Thailand for British abroad.

[Prakhonchai Nick]

Where a UK citizen wishes to stop paying UK income tax, because he is non resident and non domiciled in the UK, he can elect to pay Thai tax on any pensions/ income etc received from the UK.

Before stopping UK tax, the UK tax authorities need to be sure he will be taxed in Thailand, and require full details of his tax number in Thailand, and a letter from the Thai tax authorities that they will indeed deduct Thai income tax.. Obviously they would also require proof of some sort that he was indeed resident in Thailand

Apart from the complications in setting it up, it is quite likely he will pay more tax in Thailand, since the Personal allowance in Thailand is much lower, and therefore income tax becomes payable at a much lower starting point.

I investigated this for myself, and after doing various calculations decided it was best to stay put in the UK

There is however always the possibility that the Thai Tax authorities will fail to collect any tax. That's a chance you take.

[Admin]

Thank you for your advice and info Nick, very helpful. 

Paying the right tax if you retire abroad

If you're retiring abroad it's very important to get in touch with HMRC.

They will work out:
-your UK residency status
-your tax liability in the UK
-whether you'll need to fill in a Self Assessment tax return
-whether you are owed a tax refund

Your Tax Office will give you form P85 to get any tax refund you're owed. If you leave the country part way through the tax year, they take this into account.

P85 - Leaving the UK - getting your tax right
Form P85 and more.  
http://search2.hmrc.gov.uk/kbroker/hmrc/forms/viewform.jsp?formId=766

[Admin]

Applications and claims by non-residents under double taxation treaties

Applications and claims under double taxation treaties.

If you have income from a source in one country and are resident in another, you may be liable to pay tax in both countries under their tax laws. To avoid 'double taxation' in this situation, the UK has negotiated Double Taxation (DT) treaties with more than 100 other countries. Each treaty is called either a 'Double Taxation Agreement' or a 'Double Taxation Convention', depending on the wording of the treaty.

If you are a resident of a country with which the UK has a double taxation treaty, you may be able to claim exemption or partial relief from UK tax on certain types of income from UK sources. The precise conditions of exemption or relief can be found in the text of the relevant treaty.

Source: http://www.hmrc.gov.uk/cnr/app_dtt.htm

[Dave the Dude]

A friend of mine insists England have NOT contacted Thailand with regard to his Tax liabilities and he pays NO Tax on Income from a UK private pension. He strikes me as an honest type of guy who whould not BS. Although like Nick, I have investigated this but done nothing, I would be suprised if the Thai tax authorities have the organisational skills to liaise with HMRC.

Good advice given by Admin!

[nookiebear]

The only way he isnt paying any UK tax will be because it comes in below his personal allowance

[mxyzptlk]

Thank you for your advice and info Nick, very helpful. 

Paying the right tax if you retire abroad

If you're retiring abroad it's very important to get in touch with HMRC.

They will work out:
-your UK residency status
-your tax liability in the UK
-whether you'll need to fill in a Self Assessment tax return
-whether you are owed a tax refund

Your Tax Office will give you form P85 to get any tax refund you're owed. If you leave the country part way through the tax year, they take this into account.

P85 - Leaving the UK - getting your tax right
Form P85 and more.  
http://search2.hmrc.gov.uk/kbroker/hmrc/forms/viewform.jsp?formId=766

The above just about describes my situation.....although I'm not retired yet.....and not working either
When I left the UK to live here in Thailand, I completed form P85 and set it to the tax office. I was then given a rebate for tax overpaid and informed that I no longer needed to complete a tax self assessment. All tax correspondence from HMRC now comes directly to my house in Nongki. I still have a house in the UK which I decided to rent out and because the gross rent will not exceed my personal tax allowance I applied to HMRC to have the rent paid without tax being deducted and I am classed as a non-resident landlord. They then notified me that I need to complete a tax self assessment once more. 

[Pragmatic]

Where a UK citizen wishes to stop paying UK income tax, because he is non resident and non domiciled in the UK, he can elect to pay Thai tax on any pensions/ income etc received from the UK.

I've desperately tried to find a link to that, but failed. Pensions are automatically liable for UK tax, due to no tax having been collected on the pension installments.Therefore I can't see the UK government not wanting to see a return when the pension is payable. If it was allowed that your pension tax was collectible in another country, at a lower rate than the UK, I'm sure there would be a large exodus of UK pensioners to the said countries. Just my thoughts.

As for Admins post. I declared to the Tax Office that I was leaving and I was never asked for proof of residence. They did ask me to notify them, once I'd settled, of an address that they could contact me on. They also gave me form R85 (as I recall) which exempts me from paying tax on UK bank account interest. To get that they wanted proof of residence but backed down once I told them I had no knowledge as to where and when I would settle down. It was authorised before I left the UK and they've never bothered me since, and I still get that concession.

[nookiebear]

You still get your 'personal allowance' which depending on your circumstnces can make a portion of your income tax free,

[Prakhonchai Nick]

And from tomorrow the Personal Allowance for those who are 65 - or will be 65 in the tax year 5th April 2011 to 5th April 2012*  is just a whisker short of £10,000

*If you will be 65 in the coming tax year you are entitled to the  higher PA from 6th April in the tax year you reach 65. IR will NOT tell you this - You must enter a claim.

[nookiebear]

All Good News if I live that long!!

[torrenova]

My understanding of Thai taxes is that tax is due on income but not on capital. Thus, if you drew capital into Thailand it would be tax free and your income would be tax free at source because of non residency.

Whilst in practice, I don't think for one second you'd pay any Thai taxes, the hypothetical minimum would be for you to have 12 months of income in an account outside Thailand which you draw over the year. Your pension effectively replenishing that money would, once it is over 12 months old, be classed as capital and not income according to Thai tax law. You could them start the process all over again with money now 13 months old.

I have not investigated this for some time but this was my understanding a couple of years ago.

Again in reality, bringing money into Thailand via ATM is never going to be taxable and Somchai and his friends have no powers to visit your offshore bank accounts etc. etc.