By Pitipong Santadram, Payroll Manager
The correct way to reduce Personal Income Tax (PIT) in Thailand
Everyone would like to reduce their tax payments, but it is important to understand the correct way to achieve this.
The formula for calculating tax in Thailand
Net Income (Assessable income - Deduction Allowances) x Tax rate = PIT
The use of deduction allowances will help to reduce tax payments. In accordance with the Thai Revenue Code, tax payers may reduce their tax by following the conditions below:
Deduction Allowances (Exemptions) allowed for the calculation of PIT
Types of Allowances
Spouse allowance (with Married certificate and spouse has no income)
Child allowance (child under 25 years of age and studying at educational institution, or a minor, or an adjusted incompetent or quasi-incompetent person) (without limit)
30,000 THB for biological children.
60,000 THB for biological children born in or after 2018 (from second child onwards).
30,000 THB for adopted children, and if claiming for any adopted child, the care of children allowance is limited to three dependent children in total
Parents allowance for care of dependent parents of taxpayer or spouse in Thailand, over 60 years of age and having income not more than 30,000 THB per year. Only one taxpayer can claim it.
30,000 baht for each of taxpayer’s and spouse’s parents
Disabled / Incompetent dependent
60,000 per person
Health insurance premium for taxpayer's parents and/or spouse's parents
Actual amount paid not exceed 15,000 baht
Life insurance premium paid by taxpayer or spouse
Amount actually paid but not exceeding 100,000 baht each
Up to 25,000 THB (own health) is allowed as a deduction
Actual but not exceed 15% amount paid and not to exceed 200,000 baht
Provident fund contributions paid by taxpayer or spouse
Amount actually paid at the rate not more than 15% of wage, but not exceeding 500,000 baht
Social Security Fund contribution
Amount contributed in a year (with a maximum of 9,000 baht)
Home mortgage interest
Amount actually paid but not exceeding 100,000 baht
Super Saving Fund - SSF
Actual amount but not exceed 30% of income and not exceed 200,000 baht. (Retirement Mutual Fund + Provident Fund + Annuity Insurance must not exceed 500,000 baht)
Charitable contributions / Donations
Amount actually donated but not exceeding 10% of the income after standard deductions and the above allowances. For the donation to the hospital and educational, the deduction will be double.
Domestic purchase of goods or services expense (Shop Dee Mee Kuen)
Up to 30,000 THB under the conditions that it was purchased from a VAT-registered vendor (in Thailand). Applies to purchases made between Jan 1 – Feb 15, 2022. Tax invoice required.
It is important to retain the supporting documentation to support deductions used for the filing of the Personal Income Tax Return (PND.91/90 return) to the Revenue Department by 31 March of the following year. We hope this information will assist you to plan to reduce your tax correctly in accordance with the Revenue Code of Thailand.
Source of information:
From the www.sso.go.th website
This article and table was compiled by Khun Pitipong Santadram, Payroll Manager and should you require assistance on personal tax from RSM Thailand Taxation or Payroll services, please do not hesitate to contact us on [email protected]