Why You Will Probably Pay Less Income Tax This Year

Photo: Matichon

BANGKOK — Those who earn less than 26,000 baht per month will not be required to pay personal income taxes under new tax code launched for 2017.

The new structure, approved last year and made official Jan. 27, is meant to lessen the burden on middle-income taxpayers. Among deductions and allowances increased across the board, it raises the highest tax bracket – 35 percent – to annual incomes of 5,000,000 baht from 4,000,000 baht.

The new tax structure will reduce tax obligations, so people will have more discretionary income which will benefit the domestic economy, Revenue Department spokesman Somchai Saengratmaneedet said Monday.

The new rates for personal income taxes will be retroactive back to Jan. 1.

One significantly increased deduction is for the gainfully employed. Before, the first 40 percent of annual income – capped at 60,000 baht – was exempt. That’s now raised to 50 percent, or a maximum of 100,000 baht.

Untaxed personal allowances for single taxpayers were increased from 30,000 baht to 60,000 baht. Spouse allowances were extended from 30,000 baht to 60,000 baht, and those for children from 15,000 baht each to 30,000 baht each.

The first 150,000 baht of annual income still remains tax free.

For example, a single woman earning 25,000 baht per month will have a total annual income of 300,000 baht for the year. After deducting 100,000 baht for employment and her 60,000 baht personal allowance, her obligation will fall to 140,000 baht; hence, she won’t pay any income tax.

The new tax structure will be applied for the current tax year which taxpayers must file in 2018.

 

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