Tax deduction

[Bbbjack]

Hi

Can anyone explain how tax deduction works (personal allowance).

Let assume I have income 500k thb per year. I have 1 child. So my taxable income is 500k - 60k personal allowance - 30k child allowance = 430k thb. Is that correct? If yes, do I need to show any receipe?

Personal allowances

There is a personal allowance of THB 60,000 each for the taxpayer and the taxpayer’s spouse (provided that the taxpayer's spouse does not file one's own return). There is also an allowance of THB 30,000 for each child and an additional THB 30,000 for the second child onwards born in or after 2018. Moreover, an allowance for parental care of THB 30,000 per parent is deductible. A non-resident is allowed deductions for spouse, children, and parent only if they are resident in Thailand.

[sometimewoodworker]

2 hours ago, Bbbjack said:

Hi

Can anyone explain how tax deduction works (personal allowance).

Let assume I have income 500k thb per year. I have 1 child. So my taxable income is 500k - 60k personal allowance - 30k child allowance = 430k thb. Is that correct? If yes, do I need to show any receipe?

Personal allowances

There is a personal allowance of THB 60,000 each for the taxpayer and the taxpayer’s spouse (provided that the taxpayer's spouse does not file one's own return). There is also an allowance of THB 30,000 for each child and an additional THB 30,000 for the second child onwards born in or after 2018. Moreover, an allowance for parental care of THB 30,000 per parent is deductible. A non-resident is allowed deductions for spouse, children, and parent only if they are resident in Thailand.

 

allowances

100,000 expenses 

60,000 self

60,000 spouse 

30,000 child

30,000 1 in-law (+30,000 if both in-laws)

50,000 shopping 

 

taxable income 170,000

150,000 zero rate 

 

tax due 1,000 (if only 1 in-law, zero if 2 in-laws)

 

There is no cooking involved, no receipts are required 

[Bbbjack]

thx

 

[chiang mai]

8 hours ago, Bbbjack said:

thx

 

The above reference to a 100,000 baht allowance for expenses is highly misleading. There is an allowance available for many types of income (but not all, group 4 for example doesn't have one) which typically is a percentage of the income involved and is a maximum of 100,000 baht.

 

Also, you can itemize your expenses if you wish, but you would only want to do that if they totaled more than the standard deduction maximum. 

 

Lastly, you don't state your age but there is also a deduction of 190k for people over age 65 years, this is in addition to the expenses allowance..

[sometimewoodworker]

26 minutes ago, chiang mai said:

The above reference to a 100,000 baht allowance for expenses is highly misleading. There is an allowance available for many types of income (but not all, group 4 for example doesn't have one) which typically is a percentage of the income involved and is a maximum of 100,000 baht.

It is hardly misleading since the one class of income excluded is

Quote

Interest, dividend, bonus for investors, gain on amalgamation, acquisition or dissolution of a company or partnership, gain on transfer of shares, cryptocurrencies or digital tokens. 

The overwhelming majority of income gives the 100,000 allowance or greater. Also with an income of 500,000 as suggested that class of income is unlikely to be a factor.

 

however it is virtually always better to consult an advisor if you don’t know the totality of the rules as they are far from simple and not every booklet contains every possible allowance 

[chiang mai]

1 hour ago, sometimewoodworker said:

It is hardly misleading since the one class of income excluded is

The overwhelming majority of income gives the 100,000 allowance or greater. Also with an income of 500,000 as suggested that class of income is unlikely to be a factor.

 

however it is virtually always better to consult an advisor if you don’t know the totality of the rules as they are far from simple and not every booklet contains every possible allowance 

The Expense allowance for categories 1-3 of PIT income, the most common types, is capped at 100k, maximum, whilst category 4 income has no allowance. Category 5 income is property based and categories 6 & 7 are professional and not the standard types of PIT income the op refers to. 

 

I agree that anyone who is uncertain about the rules or not comfortable interpreting them, should seek complete and thorough professional advice and not just use it to try and fill gaps in their perceived understanding. It's very dangerous to use tax advisors in only a partial way to fill in knowledge gaps.

[Bbbjack]

thx, its clear for me, just wanted to know how to count deductions.

ill do and print all calculations and will go to rd department and will see what they say.

 

[NoDisplayName]

2 hours ago, chiang mai said:

The Expense allowance for categories 1-3 of PIT income, the most common types, is capped at 100k, maximum, whilst category 4 income has no allowance. Category 5 income is property based and categories 6 & 7 are professional and not the standard types of PIT income the op refers to. 

 

Category 4 income already comes with special rates - interest at 15% and dividends at 10%, regardless of your tax bracket.

 

Also...........I believe there was an option when filing online to EITHER list actual tax withheld on dividends/interest to request refund OR take a percentage reduction in the total, but give up your claim for refund.  I don't know the exact details, didn't purse it (I vaguely recall it was calculated as 1/7 of the total?) as my taxes withheld were within the full refund window.

[chiang mai]

5 hours ago, NoDisplayName said:

 

Category 4 income already comes with special rates - interest at 15% and dividends at 10%, regardless of your tax bracket.

 

Also...........I believe there was an option when filing online to EITHER list actual tax withheld on dividends/interest to request refund OR take a percentage reduction in the total, but give up your claim for refund.  I don't know the exact details, didn't purse it (I vaguely recall it was calculated as 1/7 of the total?) as my taxes withheld were within the full refund window.

If your only income is from savings and dividends in Thailand where tax has already been withheld, the taxpayer has the option to file and account for the details and potentially obtain a refund, or, not to file and allow the TRD to keep the tax already withheld and there is then no need to file a return.