Reader question: Can you have a Dutch benefit paid gross-net in Thailand?

Loyalis. Where that is taxed depends entirely on the nature of the benefit. So I can't give you an opinion on that right now.

Erik, as one of the two types of WIA benefits, an IVA benefit is not a wage-related benefit as referred to in Article 15 of the Double Taxation Treaty between the Netherlands and Thailand, but a social security benefit. Nothing is regulated in this regard in the Treaty, while a residual article is also missing. This means that the national laws of both countries apply and that both the Netherlands and Thailand may levy income tax on this. It therefore falls under the same regime as, for example, an AOW or WAO benefit.

Incidentally, I expect that with only an IVA benefit with a supplement in Thailand you will not soon be able to pay Personal Income Tax, given the high exemptions that apply and the 0% rate on the first 150.000 THB of taxable income .

You are only exempt from national insurance contributions and the income-related contribution under the Healthcare Insurance Act because you no longer live in the Netherlands after emigration.

This is different with regard to the supplement obtained via Loyalis on behalf of the former and I assume private employer. As a resident of Thailand, he is taxed in Thailand on the basis of Article 15(1) of the Convention (and not on the basis of Article 15(3), as incorrectly stated in the Contracting States of the Tax Authorities).

Download the Contracting States Income Tax non-residents via the link below. On page 93 you see the result for Thailand.

https://download.belastingdienst.nl/belastingdienst/docs/verdragsstaten_ib_niet_ingezetenen_ib4011z4fd.pdf

Jootje, now you change your question. First you ask 'Thailand' and now you ask 'abroad'. It depends on the treaty between the two countries. If you live in Thailand, the Netherlands will continue to levy.

Hi Jan,
It is very confusing because IVA AND WIA are used interchangeably and one is with a chance of recovery and the other is permanent. As far as I know, other rules also apply when it comes to moving abroad.

Quite right Harry…I mean WGA and Iva

Dear rori,

In your message I read that the IVA benefit is, in principle, tax-free. I also read that you have contacted UWV Breda about your benefit. However, I assume that the UWV has not tried to make you believe that your benefit is tax-free. I hope that they know better!

When emigrating to Thailand, an IVA benefit is taxed as a social security benefit in both the Netherlands and Thailand. See my previously posted comment.

The fact that no payroll tax is withheld from your benefit in the Netherlands does not mean that your benefit is not taxed. The fact that no payroll tax is withheld from this is due to the deduction of (in your case only) the general tax credit from the payroll tax due. Subsequently, there remains an amount of zero payroll tax to be paid, while I even think that you cannot fully use the general tax credit due to too little payroll tax owed.

However, when living in Thailand, as a non-qualifying non-resident taxpayer, you are not entitled to (the tax component of the) tax credits, deduction for personal obligations and tax-free allowance in box 3. This has already been changed with effect from the 2015 tax year and has therefore already been a while ago.

I think it would be wise not to post this kind of message in Thailand Blog, as an expert not in the field. This will completely mislead your readers.

Hi Dirk,

A WAO benefit is taxed in both the Netherlands and Thailand. The WAO benefit is a social security benefit. Nothing has been regulated in this regard in the Treaty for the avoidance of double taxation concluded between the Netherlands and Thailand. There is also no so-called “residual article”, which states that sources of income not mentioned in the Convention may be taxed in the source country or in the country of residence.

In the absence of a treaty provision, both countries may levy tax on this income on the basis of their tax legislation. Both countries base this on world income. The Netherlands then levies income tax on the WAO benefit as the source country and Thailand does the same as the country of residence, but insofar as you also contributed that income to Thailand in the year in which you enjoyed it.

Dear rori,

You have already pointed out a number of times to contact the UWV. You refer to the Breda office or the Amsterdam office. But can you also explain to me what the point of that is?

In that respect, read the last sentence in the response you previously posted that you received from the UWV. It literally says: "In gross terms, your IVA benefit continues without application of the so-called country factor."

And then read the answer you received to question 6: “You can settle in Thailand and receive your WIA benefit there. Your benefit is then multiplied by a factor of 0,4 because the cost level there is much lower.”

Both times it concerns taking your benefit with you to Thailand. The first answer clearly also makes a reference to the wage tax to be withheld: it is therefore not tax-free and which I already pointed out to you yesterday. You are only exempt from national insurance contributions and the income-related healthcare insurance contribution because you are no longer covered by this insurance.

The first quote is correct. The Netherlands has concluded an Enforcement Treaty with Thailand, which means that the country of residence factor does not apply. I have not yet received any signals that the (bilateral) Treaty with Thailand will be terminated!

The second quote contradicts the first quote. You would be wise to read everything carefully before posting a comment.

In this regard, see the following web link:
https://www.uwv.nl/particulieren/overige-onderwerpen/internationaal/handhavingsverdrag-naar-welke-landen-kan-uitkering-mee/index.aspx

You may have received the quoted answer to question 6 over the phone.

This reminds me of the IRS. If you call the Tax Telephone (Abroad) twice, you will also receive two different answers. And if you choose the best answer for you, the inspector will later have a third “solution”, which is usually the right one (and less favorable for you)!

CONCLUSION: don't call the UWV or the tax authorities, but ask your question in THAILAND BLOG!