Keywords: Mazars, Thailand, Tax, LTF, RMF, Revenue Department, Tax Income
5 August 2015
Individual taxpayers can deduct contributions to LTFs and RMFs from their taxable income.
- Contributions to an LTF are tax deductible up to a maximum of 15% of taxable income, or 500,000 baht, whichever is lower.
- Contributions to both an RMF and a provident fund together are tax deductible up to a maximum of 15% of taxable income, or 500,000 baht, whichever is lower.
Previously, an individual taxpayer could buy LTF or RMF units not exceeding 15% of his annual “assessable income” for tax deduction. The term “assessable income” in the previous regulation included both taxable income and non-taxable income, such as capital gains from selling shares on the Stock Market of Thailand, statutory severance pay not exceeding 300,000 baht and not exceeding 10 months, and an inheritance.
The new regulation has expanded the term “… of assessable income” to “….of assessable income which is taxable in the tax year.” Therefore, from 1 January 2015, the base amount for determining the maximum amount of LTF or RMF units which can be used for tax deduction will be assessable income after deducting all non-taxable income and tax-exempt income.