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No Thai Tax If The Monthly Salary Is Less Than 25,000 Baht?

Discussion in 'Tax issues' started by steveolevi, 2 Aug 2013.

  1. steveolevi

    steveolevi Thread Starter Well-Known Member

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    I have heard that if salary is below 25K then there is no need to file taxes and therefore schools will not deduct taxes. Any comments?
     
  2. luibkk

    luibkk Well-Known Member

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    Well, whether you have to pay tax, personal income tax it is, depends on your yearly taxable income. For example, if you are on a 25,000 baht salary and employed for the whole tax year ( Jan- Dec) and have no other taxable income in Thailand, you will have an income of 300,000 baht in that tax year. 150,000 baht are tax-free. There are also deductions for personal expenses of 30,000 baht and another decuction of 60,000 baht. Medical and life insurance can also be deducted as well as deductions for a wife and children afaik. Assuming you are single, 240,000 baht per year are tax-free. If you make more, the tax is 10% on the excessive amount. In your case, it would be 6,000 baht per year. You do have to pay income tax in this scenario.

    Many schools don't bother with tax deductions from your salary and tell you to file a tax return. Not sure if this is a legal procedure.
    Hope this helps.
     
  3. piggy

    piggy New Member

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    I never heard anyone say this, but it could be true. I think it's best to file a tax return regardless if you owe money or not. Probably need to know more than just salary. How many months are they paying you for? 12 months? Did your employment in Thailand begin mid-year? Married, single? Kids? Mortgage in Thailand? Have you purchased life insurance here? Investments? This would all affect your tax obligation.

    If you're talking January to December (meaning you worked 12 months of the tax year), and assuming you are being payed for all 12 months, your income would be 300,000 baht (12 months x 25,000 baht/month). There's a 40% deduction of your income not to exceed 60K baht, so you deduct 60,000 baht of your income leaving 240,000 baht.

    On to exemptions, again, assuming you are single, no children, no investments, no house mortgage interest and no life insurance , blah blah blah, you are exempt 30,000 for yourself, leaving 210,000 taxable income.

    The first 150,000 baht of your taxable income is exempt...this means that the remaining 60,000 baht (210,000 baht taxable - 150,000 baht exempt) will be taxed. I'm guessing that's at 5% tax rate as the tax brackets changed for this coming tax year. What's that...3,000 baht? So maybe they should withhold 250 baht per month (12 months at 250 = 3,000 baht). Much better than last year where the lowest tax bracket was 10%...then someone on 25,000/month would end up owing 6,000 tax instead of 3,000!

    Again, this all changes if you are married or have life insurance premiums that you pay every year...etc...

    I'd say, assuming the 60K employment deduction, 30K personal exemption and the initial 150K taxable income exemption (total 240K), you'd not be required to have money withheld monthly if your salary was 20,000 baht/month. (20K x 12 months = 240K) But I'd say again, I'd always file or have someone file for me, regardless.

    So, the answer is "I don't know" but I would file a tax return anyway. If your school does it for you, they will either just gig you for 3,000 baht sometime next May (like they did me my first year here) or if they're nice, they might just fudge the numbers to make it all work out at zero balance. :hilarious:

    Hope this helps a little, I'm not a tax person but I try to make sure my school is on the up and up when it comes to my hard earned money :porky:
     
  4. luibkk

    luibkk Well-Known Member

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    I've heard this too but can't get it verified. Do you have any reliable info on this?
     
  5. steveolevi

    steveolevi Thread Starter Well-Known Member

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    Awesome Luibkk! thanks
     
  6. piggy

    piggy New Member

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    I got nothin' reliable ;) Everywhere I read says that the new tax rates are "proposed" and the proposal has been approved by the "cabinet". BUT it still has to be legislated and actually put into law before it goes into effect and we can use the new rates to calculate proper withholding. Wishful thinking on my part perhaps. I hope they push it through this year ;)
     
  7. Stamp

    Stamp Administrator Staff Member

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    I though this was the latest news. :confused:

    Revenue Dept seeks to increase number of personal income tax bands
     
  8. jptouss

    jptouss Member

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    But also think about this: Every year the immigration department asks me, when I apply for our Visa extension, if you can show a receipt that you paid tax. You show them the receipt with a "0" (you have paid all your taxes), or a receipt with the amount how much you get back, and they are happy.
    So in Korat you will get in problems with immigration department if you don't report yourself at tax office.
     
  9. Mister T

    Mister T Retired, fat and happy

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    The labour office asks for a tax receipt to renew your work permit - I take this to mean that no matter how much you earn, you must lodge a return.
     
  10. betadine

    betadine Member

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    See below for the new tax rates starting for fiscal year 2013 (thus tax to be paid starting from 2014)
    Thailand-Personal-Tax.jpeg

    Thailand-Personal-Tax.jpeg
     
    Last edited by a moderator: 26 Apr 2015
  11. Stamp

    Stamp Administrator Staff Member

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    Thanks for this, betadine. ;)
     
  12. Gor Blimey Guvnur!

    Gor Blimey Guvnur! What the duck ! Staff Member

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    Firstly Steve, if you do as I do and pay your own taxes at the end of the year (e.g. pay the lot sometime before April) then I get a form from my school stating how much I have earned in the last calander year and the form that is sent to my house from the tax office. I go to the tax office and they fill it all out for me there.

    Now, I eh hem cough cough, have a letter saying I earn 420K (35 pcm) and I end up paying 15K in tax (for the last 2 or 3 years that is). I think that I am paying 10% on 150K thus I would be exempt on the first 270K. BTW: the only thing I can claim on top of the tax that all are assessed on is with my marriage cert. I believe thats a 30K exempt thing.

    SO .... I reckon if you are on 240K or less a year then you pay no tax, also as Lui pointed out in Post#2

    However, if you have worked and recieved money then you still need to submit a tax form each year even if the tax owed is zero.

    My very first year teaching in Thailand started in October, thus I had earned 2.5 months salary but was still required to go to the tax office, fill out the form, and then they gave me the yellow tax receipt for Zero Baht (yes I have kept all my tax receipts)

    I reckon you owe them a bit of tax Steve but not a lot.

    BTW: When I was a teechaaa at Rajabatti part of my salary was classed as 'housing benefit' and was exempt from the tax lark thus bringing my taxable yearly income down further ...wonder if you have this Steve? Check with your school/paperwork.

    :cheers2: GBG
     
  13. slamb

    slamb Active Member

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    My school pays my taxes for me (so they say) so I was interested to know my 'real' salary. I've worked out I'm on about 61k per month & pay almost exactly 6k tax per month; let's hope they don't start taxing the housing allowance. :no:
     
  14. jptouss

    jptouss Member

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    But Slamb, for this salary, you could expect that the school admin gives you every months a salary statement with on there your "real" salary and the tax the school deducts.
     
  15. tiredtony

    tiredtony Well-Known Member

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    It's just another way for the school to squeeze that little bit extra out of you.
    I have to pay 1500 tax on 32,000, even though i've only got a 10 month contract and I'm married with 2 kids.
    Make waves though and you're out the door.
     

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