The Government has announced the new Personal Income Tax structure entering into force for assessable incomes derived from 1st of January 2017.
The previous deductible expenses and tax allowances structure was applicable for several years and became unsuitable with the current economical environment and cost of living. The new personal income tax structure implemented by the government mainly consists of deductible expenses, tax allowances and new PIT rates for assessable income as follows:
- Increase of expenses under section 40 (1) (2) from 40% but not exceeding 60,000 Baht shall be deductible at 50% of assessable income but not exceeding 100,000 Baht;
- Increase of allowances for taxpayer from 30,000 Baht shall be deductible for 60,000 Baht, taxpayer’s spouse for 60,000 Baht and taxpayer’s children from 15,000 Baht shall be deductible for 30,000 Baht per child;
- The revision of personal income tax (PIT) rates schedules is as follows:
| New PIT Rates Schedule | |
| Net income | Rate (percent) |
| 1 – 300,000* | 5 |
| 300,001 – 500,000 | 10 |
| 500,001 – 750,000 | 15 |
| 750,001 – 1,000,000 | 20 |
| 1,000,001 – 2,000,000 | 25 |
| 2,000,001 – 5,000,000 | 30 |
| From 5,000,0001 | 35 |
| *Net income on the first 150,000 Baht is still exempted. | |
This new structure therefore offers to taxpayer higher expense and allowance rates, thus reducing their monthly tax payment and increasing their benefits, in better accuracy with the actual living cost. Such structure will enter into force for incomes derived from tax year 2017 and apply to tax returns filed in year 2018.