MBMGL A W O F F I C E

Personal Income Tax in ThailandPersonal Income Tax (PIT) is a direct tax levied on the income of a person. A person means an individual, an ordinary partnership, a non-juristic body of persons, a deceased person and an undivided estate. In general, a person liable to PIT has to compute his/her tax liability, file a tax return and pay the relevant tax, if any, accordingly on a calendar year basis.

1. Resident or Non-Resident The first thing to consider for a foreigner based in Thailand is whether your status is a "resident" or "non-resident" for tax purposes. "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 on a cash basis, regardless where the money is paid, as well as on the portion of income from foreign sources that is brought into Thailand in the same calendar year. A non-resident is, however, subject to tax only on income from sources in Thailand.

Therefore, if you are resident in Thailand, you are liable to pay tax in Thailand on your Worldwide Income. Whereas if you are non-resident in Thailand you are only liable to pay tax on income from sources in Thailand.

2. Tax Base Personal Income Tax Base = assessable income - deductions - allowances

2.1 Deductions Allowed for PIT

Legal UpdateDec 2010

Type of Income

40(1),(2) Income from employment

40% but not exceeding 60,000 baht

40(3) Income received from copyright 40% but not exceeding 60,000 baht

40(4) Income from dividend and interest Do not allowed

40(5) Income from letting out of property on hire

1) Building and wharves 30%

2) Agricultural land 20%

3) All other types of land 15%

30%4) Vehicles

5) Any other type of property 10%

40(6) Income from liberal professions

30% except for the medical profession where 60% is allowed

40(7) Income derived from contract of work whereby the contractor provides essential materials besides tools

actual expense or 70%

40(8) Income derived from business, commerce, agriculture, industry, transport, or any other activities not specified above

actual expense or 65% - 85% depending on the types of income

Deductions

Make sure you speak with your tax advisor so to have PIT tax planning in place before 31 Dec for filing by 31 March of the following year.

MBMG Accounting offer a full range of all tax, accounting and auditing services and can help you with your Personal Income Tax reporting.

Any queries you may have or for further information needed, please do not hesitate to contact Miss Usa Suwanchatree at:

MBMG International75/56 Ocean Tower II, 26th Floor,Klongtoey Nua, Wattana,Bangkok 10110 ThailandTel: (662) 665 2534-9Fax: (662) 665 2996Email: sa@mbmg-international.com

Disclaimer: This publication has been prepared for general information only. MBMG Law Office Co., Ltd. make no warranty, representation or undertaking whether expressed or implied, nor does it assume any legal liability, whether direct or indirect, or responsibility for the accuracy, completeness, or usefulness of any information. All right is reserved.

Disclaimer:

MBMG Law Brief UpdateDec 2010

MBMGL A W O F F I C E

2.2 Allowances 3. Tax Rate

Type of Allowances

Personal allowance

- Single taxpayer 30,000 Baht for the taxpayer

- Non-juristic partnership or body of persons

30,000 for each partner but not exceeding 60,000 Baht in total

Spouse allowance 30,000 Baht

Child allowance (children under 25 years of age and studying at educational institution, or a minor, or an adjusted incompetent or quasi-incompetent person)

15,000 Baht each (limited to three children)

Education (additional allowance for child studying in educational institution in Thailand)

2,000 Baht each child

Parents allowance

30,000 for each of taxpayer's and spouse's parents if such parent is above 60 years old and earns less than 30,000 Baht

Amount actually paid but not exceeding100,000 Baht each

Life insurance premium paid by taxpayer or spouse

Parents's life insurance premium paid by taxpayer or spouse

15,000 for each of taxpayer's and spouse's parents if such parent is above 60 years old and earns less than 30,000 Baht

Approved provident fund contributions paid by taxpayer or spouse

Amount actually paid at the rate not more than 15% of income, but not exceeding 500,000 Baht

Long term fund (LTF)

Amount actually paid at the rate not more than 15% of income, but not exceeding 500,000 Baht and should be held not less than 5 calendar years

Home mortgage interestAmount actually paid but not exceeding 100,000 Baht each

Social security fund paid by taxpayer or spouse

Amount actually paid each

Domestic travelling expenses

Amount actually paid during 8 June 2010- 31 December 2010 to authorized guide or hotel in Thailand but not exceeding 15,000 Baht

Charitable contributions

Amount actually donated but not exceeding 10% of the income after standard deductions and the above allowances

AmountNet Income

MarginalTaxable Income

TaxRate

Tax AmountAccumulated

Tax

1 - 150,000

10

Exempt

3,000,000

500,000

350,000

150,000

4,000,001 onward

1,000,001 - 4,000,000

500,001 - 1,000,000

150,001 - 500,000 35,000

-

900,000 1,035,000

35,000

-

37

30

20 135,000100,000