Malaysia Thailand Double Tax Agreement

Inheritance Tax As mentioned in Chapter 15 Other taxes, Thailand came into force for the first time on February 1, 2016, inheritance tax. Thailand`s double taxation agreements do not deal with or mention inheritance tax. Therefore, the question arises as to whether inheritance tax is paid under Thai tax law and whether the deceased`s estate is charged in another country subject to inheritance and estate tax, or vice versa, whether the payment of inheritance tax in the first country is charged on the IHT bill in the second country. Tax treaties aim to avoid double taxation and prevent tax evasion. As a general rule, they offer a means of granting a double payment of taxes on the same income to a person who has income that would normally be taxed in more than one country, or a tax credit for the tax paid in one country against the tax debt of a taxpayer in another country. In addition to providing benefits to taxpayers, double taxation agreements also provide for cooperation between governments in the prevention of tax evasion. Avoiding double taxation Treaties generally provide that individuals and businesses in more than one country do not have to pay taxes on the same income or, in the case of double taxation, a credit is granted in the second country for taxes paid in the first country. Similarly, a person from a non-tax country would be taxed on all income he or she received as a result of working in Thailand, even if the income was paid abroad and held abroad. For example, when a Singapore company owns shares in a Thai company and receives dividends, the Singapore-based company should pay dividend taxes in Singapore, but receives a credit for the 10% withholding tax paid to Thailand. If the Singapore company owns no less than 25% of the Thai company, the credit includes income taxes paid by the Thai company in addition to the taxes paid on the dividend. In any case, the credit should not exceed the Singapore tax rate, i.e.: You might not get a higher credit than what you owe in Singapore on your Thai income.

Teachers Under many tax treaties, a teacher from a tax statement who travels to another tax country to teach or do research at a recognized school or university is taught for up to two years for the income of his teaching or research in the country visited. Dividends from individuals since the maximum 10% tax on dividends paid to individuals under national law and since there is no lower tax treaty, no tax treaty offers a particular benefit to those who receive dividends. Students and apprentices from a tax-agreed country, who first temporarily arrive in another country of the tax treaty, are generally exempt from tax in the country where they are studying and training on the basis of remittances from their country of origin. They are also partially exempt from income in the country where they are studying or training, where these incomes are linked to their training or education and are necessary to maintain their training. Capital gains paid to individuals Capital gains paid to individuals as a result of sales of shares to the Securities Exchange of Thailand and investment funds are tax-exempt under domestic law, so there is no particular benefit under a tax treaty. Another difficulty is that in Thailand, the taxpayer is the beneficiary/transferr of a given asset, whereas in common law countries such as the United Kingdom, executors (managers in the event of an intestinal investigation) are the tax liabilities for the entire net rebate.

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