Reader question: Urgent questions about annuity
January 8 2017
Dear readers,
I have a few rather pressing questions that I hope someone can answer. It's about an annuity.
- In addition to my AOW, I have an ABP pension. In addition, I have a small annuity that is paid out by Centraal Beheer Achmea, 489 euros every 3 months.
- I recently received a letter from Achmea with an urgent request to apply to the Dutch tax authorities for an exemption from paying tax on that amount. If I couldn't get that done before 1-1-2017, the mandatory discounts (wage tax/health insurance contributions) would be applied to that amount.
- The tax authorities sent me a number of forms, which I had to fill out and send back. Then they would assess whether or not I would be exempted.
- One of the things I had to send was: documents proving that I (from 1-1-2017) would be tax resident in Thailand. So, I understand, documents that would show that I pay taxes in Thailand from that date…
My question: Can someone tell me from which authority (in Chiangmai, where I live) I could get such a document. So an official document showing that from 1 Jan. upcoming in Thailand pay tax.
A more general question: is tax withheld from my AOW and my ABP pension in the Netherlands? And if so, shouldn't that also happen in Thailand, where I have been living for quite a long time?
I will be grateful for an answer to my questions!
Regards,
Jan
Aow and abp pension remain taxed in the Netherlands, much has already been written about this
ABP pension is taxed according to its nature; state pension remains taxed in NL, but ABP also pays out other pensions than just state pension. You know best how your pension qualifies.
A lot has been written here about applying for an exemption and I refer to it, please check the contributions of the last two weeks. Or search (top left) for tax or exemption.
If your ABP pension is a state pension, then only that annuity is taxed in TH and that 489 euros per quarter falls within the exemption for 64+ and the zero percent bracket. You do not have to pay for this in Thailand unless you also have a job or run a business here. A tax number does not mean automatic payment, although people sometimes think so.
See the advice of Lammert de Haan very recently in this blog or consult the tax file; you will find all the information there. You could also search for Hans Bos's contribution about a new exemption form. Good luck.
“If your ABP pension is a state pension, then only that annuity is taxed in TH and that 489 euros per quarter falls within the exemption for 64+ and the zero percent bracket.”
I suspect that this is not correct with regard to the annuity payment. The question concerns a payment from a Dutch insurer, namely Centraal Beheer Achmea. It is very likely that the premiums or the single premium have also been deposited with this company. And even more likely this concerns a traditional annuity (payment is fixed and is determined on the basis of the interest rate at the time of taking out) and not the new product that insurers now also carry in the form of an investment annuity. In the latter case (if certain regulations are also met with regard to financial reporting), the annuity may well be exempt in the Netherlands.
In the first case, however, the Netherlands is authorized to levy tax and not Thailand (Article 18(2) of the Netherlands-Thailand Tax Treaty). Also take a look at what we wrote about this in question 11 of the Tax File and the relevant insurer AEGON.
A number of court rulings have already been made in favor of the Tax and Customs Administration on this subject. See, for example, the judgment of the Zeeland – West Brabant District Court of 19 June 2013, ECLI:NL:RBZWB:2013:5593, which can be downloaded here:
http://jure.nl/ECLI:NL:RBZWB:2013:5593
or the decision on appeal of the Den Bosch Court of Appeal dated August 19, 2011 and directed against a decision of the Breda Court of December 6, 2010, no. AWB 10/1947, can be downloaded here:
http://www.fiscaalleven.eu/jur20110819hofDenBoschBK11-00055.htm
Jan can therefore save himself the trouble of submitting a request for exemption from payroll tax. And that is a nice bonus. Or not?
In the past year I have already had a number of Thai customers where such an application has also failed. I would therefore like to advise Jan not to submit an application, but to designate this income as “taxed in Thailand” afterwards when filing an income tax return. So far, the tax authorities (it's “strange but true”) agree with this regarding my Thai customers.
I would then advise him to have the annuity payment from Centraal Beheer Achmea transferred directly to a Thai bank account to avoid problems with regard to the remittance base (Article 27 of the Treaty).
Lammert de Haan, tax lawyer (specialized in international tax law and social insurance).
If Centraal Beheer asks Achmea to request an exemption, I would do so; if I read correctly they also ask for exemption from the national insurance and the Zvw. You need a letter anyway. Just ask everything, is my opinion.
Then you didn't read it right, Erik. The questioner is talking about “wage tax/health insurance contributions”. I assume that “contribution” refers to the income-related contribution to the Healthcare Insurance Act and not to the “premiums” of national insurance schemes.
In addition, the application for exemption and an exemption decision contain absolutely nothing with regard to the income-related contribution to the Healthcare Insurance Act. After all, it concerns an application for an exemption from payroll tax.
Apparently Centraal Beheer Achmea is aware that the questioner Jan falls outside the circle of people insured for the national insurance schemes as he lives outside the Netherlands.
In addition, benefit agencies usually do not withhold an income-related Zvw contribution when living abroad. After all, you automatically fall outside the circle of insured persons here too. In one case, however, it goes wrong. Last year, for example, this contribution was wrongly withheld from a customer of mine for a few months by the ABP (not the smallest player, after all!). When this was stopped by ABP itself, they had failed to correct the previous months. One phone call was enough to rectify this as well. It is therefore important to keep an eye on this.
And what remains after the national insurance contributions and the income-related Zvw contribution? The WAGE TAX!
And as it seems to me, we are dealing here with a traditional annuity where the premiums or the deposit and the payment are very likely in one hand. In that case, it makes no sense to apply for an exemption from payroll tax. See my earlier response.
In addition, the declaration of exemption has no legal basis whatsoever: the seventh paragraph of Article 27 of the Wage Tax Act 1964 (Wet 2003b), dealing with the method of levying and on which this declaration was based, has been canceled with the Tax Plan XNUMX . In other words: Centraal Beheer Achmea can now decide for itself not to withhold wage tax. In case of doubt on their part, THEY THEMSELVES can request a statement from the inspector.
Just read the Explanatory Memorandum accompanying this legislative amendment:
“Article II, part E (Article 27 of the Wage Tax Act 1964)
The formal requirement included in the seventh paragraph that a withholding agent, if no wage tax should be withheld on the basis of a treaty or any other rule of international law, can only refrain from withholding wage tax if the employee has given him a statement to that effect which the employee has received from the inspector will lapse.
The abolition of this requirement means an administrative burden reduction for the withholding agent. Incidentally, it remains (optionally) possible for withholding agents to request a statement from the inspector in case of doubt about whether or not the withholding obligation exists.”
And then it seems very strange that an exemption decision of the inspector of 18 October 2016 still refers to the seventh paragraph of Article 27 of the Wet lb, which has long since ceased to exist. The cause of this will also be clear to you: a lack of legal knowledge!
If questioner Jan does not get through to either the Tax Authorities or Centraal Beheer Achmea, he can contact me about what to do next. The easiest way is via my email address: [email protected].
Or else via the contact form on my website:
http://www.lammertdehaan.heerenveennet.nl.
Consider this as a service to "members" of Thailandblog.
Dear Jan,
According to the tax treaty, you must prove that you are a “Thailand resident”. According to the treaty you are if you are subject to tax in Thailand.
According to Thai law (see below) you are subject to tax there (“Taxable Person” – “liable to pay tax on income”) if you live in Thailand for more than 180 days of the year.
taxable person
“Taxpayers are classified into “resident” and “non-resident”. “Resident” means any person residing in Thailand for a period or periods aggregating more than 180 days in any tax (calendar) year. A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources that is brought into Thailand. A non-resident is, however, subject to tax only on income from sources in Thailand”.
That is it. Nothing more and nothing less.
Write this to the tax authorities and enclose copies of the entry and exit stamps of your passport showing this.
Succes
In Chiangmai you go to the goverments tax building of northern Thailand.
Located on the Chotana road Amphur Muang telf no. 053 112409 – 15
Here you can obtain the Ro 20 and Ro 21 document.
Jan Beute.
Dear Jan, I live in Maerim. If you can't find the place where you can get the Thai tax statement, I'd like to ride with you. Then contact us at [email protected]