New Thailand Personal Income

New Thailand Personal Income Tax Scheme Effective Since Year 2017

Revenue Department has announced new tax scheme for personal income tax on 20 April 2016 and effective since January 2017. The new tax scheme increases several items of personal allowances and adjust tax percentage. The maximum income tax rate still remains at 35%; however, the income base for maximum tax rate is moved up to 5 million which is 1 million above the old scheme.

 

Personal Income Tax (PIT)

  • Income tax collected from personal income tax base
  • Income tax based or “net income” is calculated from total income for the year (1 January – 31 December) deducted by tax expenses and tax allowance.

    Total Income – Tax Expenses – Tax Allowance = Net Income

Income Tax Base

  • Cash received from payer
  • Asset received from payer
  • Fringe Benefit received from payer
  • Income tax absorb by payer

 

Type of Income

  • 40 (1) Salary
  • 40 (2) Wage
  • 40 (3) Goodwill, Annual fee, Copy Right, etc.
  • 40 (4) Benefit from investment (i.e. dividend, interest)
  • 40 (5) Asset Rental Income or income from breach the financial lease contract / hire-purchase
  • 40 (6) Professional Service Income (Healthcare Profession, Legal Profession, Accounting Profession, Engineering Profession, Architecture Profession and Artist)
  • 40 (7) Contractor Income
  • 40 (8) Income from commercial business, agriculture, industrial, logistic, and other not specific in (1) – (7)

     

    Salary & Other Benefit Including:

  • Salary
  • Bonus
  • Overtime
  • Accommodation paid/provide by employer
  • Debt/benefit paid by employer
  • Meal provide by employer
  • Assets or any benefit received from employer

     

    Tax expense for income type (1); total tax expenses allows 50% of total income, maximum at THB 100,000 

    Example

    Monthly salary for Mr. A = 50,000 total annual income = THB. 600,000

    Tax expense for Mr. A = 600,000 x 50% = 300,000; however, maximum tax expense allows at THB. 100,000, thus Mr. A tax expense = THB. 100,000

     

    General Tax Allowance:

      • Personal tax allowance THB 60,000
      • Spouse (no income) THB 60,000
      • Children THB 30,000 per person
      • Parents (aged over 60 and no income) THB 30,000 per person
      • Disable person caretaker THB 60,000 per person
      • Life insurance policy in Thailand (actual paid, maximum THB 100,000) (policy cover over 10 years)
      • Health insurance policy for parent (actual paid, maximum THB. 15,000)
      • Housing loan interest (actual paid, maximum THB. 100,000)
      • Social security payment (actual paid, maximum THB 9,000)
      • Provident Fund (actual paid, maximum THB. 100,000)
      • First house project (purchase during 13 Oct 2016 – 31 Dec 2016) tax allowance allows to deduct THB. 120,000 per year for 5 years.
      • Invest in LTF/ RMF (actual investment amount but not over than 15% of total income and maximum at THB 500,000)
      • Donation (actual paid, maximum at 10% of net income)

 

 Current Personal Income Tax Rate: Since January 1, 2017.

 

Net Income

Income range

Tax rate

Tax expense

0-150,000 (exempt)

150,000

0%

0

150,001-300,000

150,000

5%

7,500

300,001-500,000

200,000

10%

20,000

500,001-750,000

250,000

15%

37,500

750,001-1,000,000

250,000

20%

50,000

1,000,001-2,000,000

1,000,000

25%

250,000

2,000,001-5,000,000

3,000,000

30%

900,000

5,000,001 (up)

35%

 

Example For Calculation Method (Regular Salary)

 

Salary (60,000 / THB)                                                     720,000 THB / Year  (1)

Deduct ;  Expenses                                                         100,000 THB / Year  (2)

              Personal Allowance                                            60,000 THB / Year  (3)

               Social security fund                                              9,000 THB / Year  (4)

Base Income (1) – (2)-(3)-(4)                                           551,000 THB

Tax Calculation;

0 – 150,000 x 0%                       150,000                                    0

150,000 – 300,000 x 5%             150,000                              7,500    

300,000 – 500,000 x 10%          200,000                             20,000

500,000 – 750,000 x 15%             51,000                              7,650

Total                                          551,000                          35,150

Per Month (35,150 / 12)              2,929.17 THB

 

Example For Calculation Method (Bonus Payment Month)

Salary (60,000 / THB)                                                     720,000 THB / Year  (1)

Bonus                                                                            120,000 THB             (2)

Deduct ;  Expenses                                                    100,000 THB / Year   (3)

               Personal Allowance                                      60,000 THB / Year   (4)

               Social security fund                                         9,000 THB / Year   (5)

Base Income (1) + (2)-(3)-(4)-(5)                                    671,000 THB

Tax Calculation;

0 – 150,000 x 0%                       150,000                                    0

150,000 – 300,000 x 5%             150,000                              7,500    

300,000 – 500,000 x 10%          200,000                             20,000

500,000 – 750,000 x 15%           171,000                             25,650

Total                                       671,000                             53,150

Tax to be paid on month  53,150 – 35,150 =  18,000     THB

 

 

International Proficiency Service with Local Price

For any questions, queries or advice about our tax and accounting services, please do not hesitate to contact us.

Twitter

Linkedin

Optimum Accounting Services Co., Ltd.

Phone: +662 636 3464

Fax: +662 636 3466

Twitter

Linkedin

© 2020 Optimum Accounting Services Co., Ltd. All rights reserved.