Thai tax residency certificate without spending 180+ days in the country?

[Marzio]

How? You mean commit tax evasion in the UAE?

No, i mean working for your company through an EOR, it's perfectly legal and you minimze the risk of creating a PE for your offshore company.

You still have to solve the offshore director problem, would you say a nominee director wouldn't be enough?

 

[JustAnotherNomad]

I'm not sure if it would really help that much / if it would be worth the hassle. Enforcement in the UAE will be weak in the beginning anyway.
Probably a nominee director would be fine - but where to find one? I think that there's a risk of either getting scammed or risking a tax liability in some other country.
Well, unless you get a nominee from a zero-tax country like Bahrain - but then you could also just go for Qatar residency or something...

 

[Mercury]

Yes, for banks it may be OK, but not for taxes, such as reduced withholding tax rates, etc.

I don't know for other brokers but for IBKR you can register as a Thai resident giving visa/address proof/local bank statement without providing any TIN, as you can be TH resident legally paying no tax in Thailand. 15% withholding tax is applied to US stock dividends as per US-TH DTA. Obviously, you need to be sure not being tax resident in other countries.

 

[JustAnotherNomad]

I don't know for other brokers but for IBKR you can register as a Thai resident giving visa/address proof without providing any TIN, as you can be TH resident legally paying no tax in Thailand. 15% withholding tax is applied to US stock dividends as per US-TH DTA.

Even easier, you can buy a gun and rob your nearest bank. No need to even provide an address and you will get more money, even if you don't have an account at that bank.
Seriously, the kind of stuff people suggest here...

 

[scooterguy]

Even easier, you can buy a gun and rob your nearest bank. No need to even provide an address and you will get more money, even if you don't have an account at that bank.
Seriously, the kind of stuff people suggest here...

Becoming a Thai legal resident is comparable to buying a gun and robbing a bank? Damn, Thailand has a worse reputation than I had thought...

 

[JustAnotherNomad]

Claiming treaty benefits as a tax nonresident of Thailand (whether you are resident or not) is a felony, yes.

 

[scooterguy]

Claiming treaty benefits as a tax nonresident of Thailand (whether you are resident or not) is a felony, yes.

You can choose not to claim the benefits or pay the remaining 15% in Thailand if you want to, and that will solve your original problem if you are willing to spend at least 180 days in Thailand.

 

[JustAnotherNomad]

You can choose not to claim the benefits

Yes, that would be the correct way to do it. But the suggestion to send IBKR some documents and claim you're entitled to treaty benefits when you're not would be criminal.

or pay the remaining 15% in Thailand if you want to

No, you'd still be committing tax fraud in the US.

if you are willing to spend at least 180 days in Thailand.

Obviously, once you do that, you'd be entitled to treaty benefits.

 

[Mercury]

Yes, that would be the correct way to do it. But the suggestion to send IBKR some documents and claim you're entitled to treaty benefits when you're not would be criminal.

If you live at least 180 days/year in Thailand you are considered TH tax resident. Assuring that you have no other tax residencies, when registering with IBKR you indicate Thailand as your country of residence providing address proofs. Then, when filling W-8BEN form in order to get US-TH DTA WHT rate just tick the box in 6b field "Check if FTIN not legally required".

Everything seems to be perfectly legal, at least from the international broker and the Thai Revenue Department point of view, as plenty of foreigner/retiree residents in Thailand are invested in stocks with international brokers and receive US dividends withheld at 15% without any issue.

Could you please explain what your point is?

 

[Marzio]

If you live at least 180 days/year in Thailand you are considered TH tax resident

Is it possible to obtain a Thai tax residency certificate without spending 180+ days in the country

His point is that he will not stay enough in Thailand to be considered TH tax resident.

 

[JackAlabama]

If you live at least 180 days/year in Thailand you are considered TH tax resident. Assuring that you have no other tax residencies, when registering with IBKR you indicate Thailand as your country of residence providing address proofs. Then, when filling W-8BEN form in order to get US-TH DTA WHT rate just tick the box in 6b field "Check if FTIN not legally required".

Everything seems to be perfectly legal, at least from the international broker and the Thai Revenue Department point of view, as plenty of foreigner/retiree residents in Thailand are invested in stocks with international brokers and receive US dividends withheld at 15% without any issue.

Could you please explain what your point is?

He meant you cannot claim that low WHT while you are for example resident in a country which has no DTA and WHT would be 30%.
So you effectively made 15% of Uncle Sams back by giving him 15% of your income by providing a tax residency which is not true, whereas uncle sam wants 30%.
If you effectively stay there for 180days +, uncle sam is happy to only take 15%.

 

[Mercury]

He meant you cannot claim that low WHT while you are for example resident in a country which has no DTA and WHT would be 30%.
So you effectively made 15% of Uncle Sams back by giving him 15% of your income by providing a tax residency which is not true, whereas uncle sam wants 30%.
If you effectively stay there for 180days +, uncle sam is happy to only take 15%.

His point is that he will not stay enough in Thailand to be considered TH tax resident.

Ok, I get it.
Well, in reality only Thai Immigration knows how many days you effectively stay in Thailand a year, and these data are used to fine overstayers in the kingdom. Even if they can figure out who is tax resident/non-resident, I'm not sure they really want to enforce anything with that otherwise it would have been the case since long time.

 

[JustAnotherNomad]

The others already said it. This has nothing to do with Thailand! It's about the US, for example.
If you stay 180+ days in Thailand, 15% US tax on dividends paid by US companies.
If you stay 179 days in Thailand, even if you have an apartment there, and you travel the world for the rest of the year, 30% US tax on dividends paid by US companies.
This has nothing to do with Thai immigration or what they enforce. You are not allowed to claim the lower US (!!!) tax rate if Thailand doesn't see you as a tax resident.
If you lie to the IRS and say you are Thai tax resident (i.e. that you spent 180+ days in Thailand when you haven't), then that is a crime under US law. Period.
You can also tell IBKR you live in a country with an even lower rate, IBKR won't check that (or it would be easy to fool them), but it would be just as illegal.

My question was about if there is a way to be considered tax resident in Thailand even if you spend less than 180 days in the country.
For example, many countries also count short absences. So if you spend 3 weeks in Thailand and then 1 week out of the country, in many countries, they would count this as 4 weeks in the country.
But apparently Thailand doesn't.

 

[Mercury]

This has nothing to do with Thai immigration or what they enforce. You are not allowed to claim the lower US (!!!) tax rate if Thailand doesn't see you as a tax resident.
If you lie to the IRS and say you are Thai tax resident (i.e. that you spent 180+ days in Thailand when you haven't), then that is a crime under US law. Period.

I get your point. This is not about the law but law enforcement.

But again, IRS has no way to know how many days you effectively spend in Thailand. Unless there is an international arrest warrant against someone, I don't see why Thailand would give information on its residents.
Besides, in case of your home/family/life is really in Thailand and you're just holidaying around spending 179 days abroad in a specific year, I don't see IRS coming after you because 1 day is missing to be TH tax resident on paper... but I may be wrong.

In my opinion, striving to be a law abiding citizen as a nomad is a real nightmare as countries are desperate to put a label on people in order to control and tax them (and there is no Worldwide Nomad Label).
So, either travel around keeping a low profile, or settle down somewhere at least half a year and maybe sleep better at night.

 

[JustAnotherNomad]

The IRS won't check how many days you spent in Thailand, that is none of their concern. That's not their job to check at all. Do you think they keep their own list of the rules of every country on earth?
But they can ask for a tax residency certificate (the topic of this thread). That is issued by the Thai authorities and they would check how many days you spent in the country.
And if you can't get the certificate, good luck with the IRS.

 

[jafo]

This is not about the law but law enforcement.

Boots-on-the-ground with battle-in-the-trenches real-life experience here --->
Principle of Sabotageproof = If you do NOT SNITCH on yourself (read "brag about it"), protest, start trouble, post negative things about "others", or sue every Tom, Dick, and Harry then NOBODY will come after you! *NOBODY*.

PS. Several people I know (which I shouldn't; but they disclosed and that's a NO-NO), including, but not limited to Americans & Europeans, have lived a full unencumbered, stress-free, and rich life (some reached 102) by following the Principle of Sabotageproof.

PSS. Two people can keep a secret...ONLY if one of them has passed away!

 

[88mdok]

Hows about if you are not concerned with the whole 15%/30% withholding on dividends thing?

I don't trade for dividends. Moreso price fluctuations and hold only for a few minutes or hours before closing positions. Maybe a few days at most. I don't really give two hoots about dividend based investing so if the threat is for IBKR to collect either 15 or 30% and a certain form filling out process makes the difference between completely/legally satisfying or deliberately deceiving and fraudulently lying to the IRS then 15/30 is not much of a big concern for me.

 

[Mercury]

Regarding US WHT, this information could be useful: Instructions for Form W-8BEN

Quote page 6 Line 3: " Your permanent residence address is the address in the country where you claim to be a resident for purposes of that country’s income tax. If you are completing Form W-8BEN to claim a reduced rate of withholding under an income tax treaty, you must determine your residency in the manner required by the treaty. Do not show the address of a financial institution, a post office box, or an address used solely for mailing purposes. If you do not have a tax residence in any country, your permanent residence is where you normally reside.
If you reside in a country that does not use street addresses, you may enter a descriptive address on line 3. The address must accurately indicate your permanent residence in the manner used in your jurisdiction."

Quote page 6 Line 5: " If you are claiming treaty benefits, you are generally required to provide an ITIN if you do not provide a tax identifying number issued to you by your jurisdiction of tax residence on line 6. However, an ITIN is not required to claim treaty benefits relating to:
• Dividends and interest from stocks and debt obligations that are actively traded;
• Dividends from any redeemable security issued by an investment company registered under the Investment Company Act of 1940 (mutual fund);
• Dividends, interest, or royalties from units of beneficial interest in a unit investment trust that are (or were upon
issuance) publicly offered and are registered with the SEC under the Securities Act of 1933; and
• Income related to loans of any of the above securities. "


Also, when filing a W-8BEN form providing a Tax Residence Certificate is nowhere a requirement.
Are there any cases of a US Nonresident Alien being asked by IRS to provide so?

 

[Mike Forman]

To fight a tax residency claim from another country.

You only need this if you want to make use of a double taxation treaty.

It's an utopia that a residence certificate will save you from the fight of a residency claim of any other country, that country will require you to provide much more substantial evidence that you actually lived in the country you claimed to be residence at (rental contract, daily spending, gym subscription, Restaurant bills,passport stamps, flight tickets, credit card statements..). Anyone who believes that by staying 90 days in a country and getting a certificate will save him/her from any foreign tax investigation / claim I wish good luck.

Having it adds to the proof but this alone won't be enough. All will also depend on how serious they want to go after you. Investigative tax authorities aren't stupid.

 

[Marzio]

You only need this if you want to make use of a double taxation treaty.

And that's exactly what i meant.

Without a tax certificate it's already game over because you can't access the DTT

Anyone who believes that by staying 90 days in a country and getting a certificate will save him/her from any foreign tax investigation / claim I wish good luck.

You don't need good luck if you know the rules.

If two countries considers you tax resident and your permanent home is in the country where you spent 90 days guess who will win.