Filing of individual tax returns for 2017 has already opened, but the process of filling out a return has changed significantly over the past few years because of major changes in the tax structure, as well as new standard allowances and deductions.
With the amended Revenue Code, the income thresholds for tax filing obligations have changed. Previously, individuals were required to file a tax return if they earned a minimum income of 50,000 baht from employment. Under the new structure, the threshold is higher: single taxpayers only need to file their tax returns if they earn more than 100,000 baht a year; married taxpayers need file only if their income exceeds 200,000 baht and employment is their only source of income.
Single taxpayers who earn income from employment as well as other sources of income, or who only have income that is not generated from employment, must file tax returns if the total income exceeds 60,000 baht, while the threshold is 120,000 baht for married couples.
Income earners who are single or do not have children, and earn up to 310,000 baht a year, or 25,823 baht a month, can reduce their income tax liability to zero by fully utilising the new tax-free personal allowance and deductible expenses. Previously, single or childless individuals were liable for an income tax bill if they earned more than 249,000 baht annually, or 20,750 baht a month.
Chatpong Watanajiraj, head of Kasikornbank's advisory development, says individual taxpayers can gain a range of benefits from the additional 70,000-baht personal tax allowance deduction against assessable income and those in higher income tax brackets can save on taxes.
For example, those earning income in the 10% tax bracket can save 7,000 baht, while those in the 20% bracket can cut income tax by 14,000.
Individual taxpayers and those who are exempt but have income that hits the filing requirement can file their tax returns through the Revenue Department's offices across the country until March 31 and at the department's online platform until April 9 to avoid penalties.
Those who fail to file personal income tax returns within the deadlines are subject to a 2,000-baht fine, with an additional 1.5% of the tax owed per month delayed.
The easiest way to get income tax refunds is to avoid filing tax forms at the last minute. Those who have PromptPay, a money transfer service under the national e-payment scheme, will be prioritised by the Revenue Department for refunds.
Mr Chatpong recommends filing tax returns online, as filers will only need to fill out income and tax break information and let the system calculate tax bills, saving them the trouble of travelling to the Revenue Department's offices.
In the event that taxpayers are liable for additional income tax payments, they can defer such payment by paying by credit card, which also offers free interest for a certain period, depending on each card's conditions.
Here are the changes to be aware of when filing 2017 tax returns.
E-tax is part of the larger national e-payment system for more efficient taxation. Tanaphon Ongarttrakul
Adjustment in income ranges
The seven tax brackets -- 5%, 10%, 15%, 20%, 25%, 30% and 35%, and income ranges for 5%, 10%, 15%, 20%, and 20% -- remain unchanged, but income bands for the top tax rates of 30% and 35% are wider.
According to the current personal income tax structure, taxable income of 150,000 baht or lower is exempt from tax, 150,001-300,000 baht is charged 5%, 300,001-500,000 baht is charged 10%, 500,001-750,000 baht is charged 15%, 750,001-1 million baht is charged at 20%, 1,000,001-2 million baht is charged at 25%.
The income band for the 30% bracket has been raised to 2-5 million baht from 2-4 million baht, and the range for the top rate of 35% starts from 5 million baht.
Increases in tax allowance
Each taxpayer is entitled to a 60,000-baht tax allowance, doubling from 30,000 baht a year in the past. For joint filings, spouses who earn income can claim a 120,000-baht tax allowance, compared with 60,000 in the past.
Parents are permitted to claim a child allowance of 30,000 baht each without any numerical limit for all biological children, and they can claim up to three adopted children.
The current structure abolishes a 2,000-baht education allowance for each child studying in Thai schools or universities.
Previously, individual taxpayers would claim a 15,000-baht allowance per child and an additional 2,000 baht per child for education allowance, but limited to three kids.
Hikes in deduction against assessable income
The cap on income deductions has been raised to 50%, but only for up to 100,000 baht, compared with the previous cap of 40% for up to 60,000 baht.
Health insurance
Starting from 2017, taxpayers can claim a deduction of up to 15,000 baht for premiums paid to health insurance provided by both life and non-life insurers.
Insurance premiums of up to 100,000 baht can be claimed when premiums paid to life protection products with at least 10-year terms are combined.
Life insurance policyholders with 10-year terms, under the previous code, were not allowed to claim deductions for premiums on health insurance coverage.
Tax breaks on shopping
Each individual taxpayer can deduct domestic purchases of goods and services worth up to 15,000 baht and made during the period of Nov 11-Dec 3, 2017 from taxable income.
For the three years that these tax perks have been in place, they were not valid for purchases of liquor, beer, wine, tobacco, vehicles, motorcycles, ships, or fuel for vehicles and ships, and value-added tax invoices were required for the tax deduction.
Charitable donations
Taxpayers who donate to help flood victims in the South during Jan 1-March 31, 2017 and the Northeast during July 5-Dec 31, 2017 are entitled to claim money or value of donated items as allowance expenses at a rate of 1.5 times but at no more than 10% of assessable income when combined with other donations.
Such donations must be made through state agencies and approved charitable organisations, and receipts for donations are required when filing tax returns.
Flood damage repair costs
To help people who suffered from the flooding in the South and Northeast, taxpayers are eligible to claim expenses incurred from fixing homes and vehicles affected by the floods at the amount actually paid, but with a cap of 100,000 baht for homes and 30,000 baht for vehicles.
Repair expenses must be for damage from the floods during Dec 1, 2016-May 31, 2017 for the southern provinces and during July 5-Dec 31, 2017 for the northeastern provinces.
First-home buyers
Those who bought their first homes valued up to 3 million baht during Jan 1-Dec 31, 2016 are eligible to claim 20% of the buying price, distributed over the next five tax years.
