How To Reduce Income Tax

[kurnell]

I am paid a salary based on a set USD figure, but I pay a lot of tax. I cannot be paid offshore so am looking for a way to break down my income to reduce my tax. I know that claiming a car allowance, travel expenses etc won't work, so has aonyone had any luck with something that I don't know about?

[samran]

- long term funds are a good way of putting savings away tax free, though you are limited to about 300,000 baht per year from memory. Money needs to be held in an LTF for a minimum of 3 years and 1 day (depending on when you invest).

Fund managers like ING Thailand offer them

[chiangmaibruce]

Agree with Samran. Google on "Long Term Equity Fund" and "Retirement Mutual Fund"

You can invest up to 15% of annual taxable income to a maximum of 500,000 baht (it was increased)

more details from www.ingfunds.co.th/en/GettingStarted_RMFLTF.asp (but note that similar products also offered by other fund managers)

[samran]

Agree with Samran. Google on "Long Term Equity Fund" and "Retirement Mutual Fund"

You can invest up to 15% of annual taxable income to a maximum of 500,000 baht (it was increased)

more details from www.ingfunds.co.th/en/GettingStarted_RMFLTF.asp (but note that similar products also offered by other fund managers)

thanks for the update.

Aberdeen is another one. I belive all the main banks also have access to LTF products as well.

[Soutpeel]

I am paid a salary based on a set USD figure, but I pay a lot of tax. I cannot be paid offshore so am looking for a way to break down my income to reduce my tax. I know that claiming a car allowance, travel expenses etc won't work, so has aonyone had any luck with something that I don't know about?

Can you not get the company to pay some of your expenses pre-tax ie rent, telephone, subsistance, per diem etc and "reduce" your take home salary that way ??..therefore less tax payable ??

May not be applicable in your case, so just a thought ??

[thaihome]

I am paid a salary based on a set USD figure, but I pay a lot of tax. I cannot be paid offshore so am looking for a way to break down my income to reduce my tax. I know that claiming a car allowance, travel expenses etc won't work, so has aonyone had any luck with something that I don't know about?

Can you not get the company to pay some of your expenses pre-tax ie rent, telephone, subsistance, per diem etc and "reduce" your take home salary that way ??..therefore less tax payable ??

May not be applicable in your case, so just a thought ??

Unfortunately, in Thailand all those things are considered a benefit to the employee, so are taxable income. There is very little one can do here to reduce taxes.

TH

[kurnell]

I am paid a salary based on a set USD figure, but I pay a lot of tax. I cannot be paid offshore so am looking for a way to break down my income to reduce my tax. I know that claiming a car allowance, travel expenses etc won't work, so has aonyone had any luck with something that I don't know about?

Can you not get the company to pay some of your expenses pre-tax ie rent, telephone, subsistance, per diem etc and "reduce" your take home salary that way ??..therefore less tax payable ??

May not be applicable in your case, so just a thought ??

Unfortunately, in Thailand all those things are considered a benefit to the employee, so are taxable income. There is very little one can do here to reduce taxes.

TH

Thought so.

[aurelius]

The tax relief from LTF is 500,000bt and as noted before it has to be held for 3 tax reporting periods, and the same tax relief is available from RMF, but this has to be held until reaching 55 years of age.

Bancassurance products also offer some tax relief - the shortest term is about 7-10 years, ranging up to 20+ years. See a bank for these; Bangkok Bank products generally appear to have the best IRR, which is lowest on the short term products.

[jlelouer]

LTF, RMF, Life insurance (up to 100K), home mortage interests (up to 100K).

If you buy a house/condo in 2009, you get 300K deductible.

[QED]

Marry a bird (30k), with 3 kids at school (51k) and elderley poor parents (another 30k), and get 111k knocked off your taxable income, saving up to 41,070 baht p/a if you pay top whack.

Sadly this route will cost you alot lot more than you will save however

Social security has just dropped by 300 bt p/m to the end of the year, so there's 1,800 you've saved without even trying

As a previous poster mentioned there really is not much you can do. We have a provident fund which I would recommend, employer and employee pay 5% each, but it only costs me 3.5% due to the tax relief (3 yr rule applies).

[tvaddict]

Not sure about this type of thing so please explain in layman terms:

but from what I read on the ING site it says you need to keep the Long Term Equity Funds untouched for 5 years and yet here you guys all seem to be in agreement that it's only 3 years needed.

has it changed recently? or am I missing something

also about the interest on house loan- if you have bought in wife's name are you as gaurantor eligible for 50,000 only ( your wife being eligible for 50 too) or can you claim the whole non tax allowance of 100,000 yourself?

can you give me an example of a good long term equity fund to start my research

cheers-

[chiangmaibruce]

... from what I read on the ING site it says you need to keep the Long Term Equity Funds untouched for 5 years and yet here you guys all seem to be in agreement that it's only 3 years needed.

has it changed recently? or am I missing something

say you buy on the last day of year 2000 and then redeem your funds on the first day of 2004 - that counts as five years

also about the interest on house loan- if you have bought in wife's name are you as gaurantor eligible for 50,000 only ( your wife being eligible for 50 too) or can you claim the whole non tax allowance of

100,000 yourself?

You wish ... Unless I'm missing something, you have no ownership of the property whatsoever and hence you can't claim any deduction for it

can you give me an example of a good long term equity fund to start my research

well, start at the ING web site reference noted earlier. google on the topic to see if there have been any recent journal or newspaper articles, and maybe take a look at http://www.aimc.or.th/en/home.php

[allan400]

LTF: The year you buy the LTF fund count as 1 year. So yes, but last day, and count as first year. Then you can selll after 3 years, at the 1st day of the year 5. I.e. you hold them 3 years and 2 days. But in reality you don't want to do that, because usually the Thai stock market tend to be increasing in the very end of the year, because many Thais buy LTF...!!

Mortage Tax allowance 100K: If you are only guaranteer of the loan, then you cannot deduct any tax for the interest! This is 100% sure, because I had to pay back tax for 3 years, when Revenue Department suddenly checked deep in my tax filing, and they found my wide is the owner of property and person on the loan-papers.... You will be able to deduct if you make the loan at the nabk with both names. This could be possible in some banks, I have heard. At least this is what I am trying to do now, so I can deduct at least 50% of the interest next year!

[roderick17]

Greetings All

In Thailand, are capital gains subject to tax or are such gains free of taxation ?? If a capital gains tax is in existence in LOS, can someone give me an indication of how this tax obligation applies to asset sales and the tax rates that applies to surpluses generated in this way

Thanks

Roderick

[Carmine6]

Greetings All

In Thailand, are capital gains subject to tax or are such gains free of taxation ?? If a capital gains tax is in existence in LOS, can someone give me an indication of how this tax obligation applies to asset sales and the tax rates that applies to surpluses generated in this way

Thanks

Roderick

You should check with Thaksin on that. Seems like they may or may not be depending who you ask.

For lower profile individuals I think it's the same as income unless it is a stock listed on the Stock Exchange that you sell through a registered broker.

http://www.rd.go.th/publish/6045.0.html

"Assessable income is divided into 8 categories as follows :

....

(4) income .... payments received as a result of ... an increased capital holdings, gains from amalgamation, acquisition or dissolution of juristic companies or partnerships, and gains from transferring of shares or partnership holdings; "

[Yoshitaka]

Correct. Normally capital gain from the stock market is tax exempted. Unless your name is Thaksin.

[tvaddict]

allan400,

I have news for you-

I enquired about the possibility of getting a tax rebate (on interest of bank loan) recently with my bank manager-

i have a house already-

it's in my wife's name

i'm the guarantor and my name does not appear on the bank loan contract but her surname is the same as mine

the bank manager contacted the local tax office and they confirmed I could-

so i went with her to the tax office

and they advised and processed my tax rebate application-

they checked my tax return form from last year as well as my wife's and other papers- bank loan contract and the annual bank statement showing how much capital and how much interest was paid on the loan in repayments last year

my wife already used her 50,000 eligibility

so I was only eligible for a further 50,000

the tax staff filled in some forms for me and I am now waiting for my 15,000 cheque ( within 3 months)

although I have not yet received the cheque I feel sure that it will come and so can say with certainty that it is possible to get this allowance

the bank I use is UOB by the way

[kssn]

Can be use funds and fund of funds , LTF Funds, RMF Funds, information in Wander Funds www.vwander.com/funds/ thank.