You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

March 24, 2020

Tax Incentives for Investment in Thailand’s Super Savings Fund Scheme

Subscribe to Updates

On March 13, 2020, the Revenue Department of Thailand issued Notification of the Director General of Revenue Concerning Income Tax (No. 369) Re: Criteria, Methods and Conditions for Income Tax Exemption on the Purchase of Investment Units of Super Savings Funds (SSFs).

The tax incentives for investment in SSFs are intended as a substitute for the tax incentives for investment in Long-Term Equity Funds (LTFs), which were discontinued at the end of last year. The criteria and conditions for tax exemption under the SSF scheme are summarized below:

  • In any tax year, a taxpayer may not make SSF investments in excess of 30% of their total taxable income for that year, capped at THB 200,000.
  • The taxpayer’s total SSF, Provident Fund, Government Pension Fund, Private Teacher Aid Fund, Retirement Mutual Fund (RMF), Annuity Insurance Premium, and National Savings Fund investments and contributions must not exceed THB 500,000 in a single tax year.
  • Taxpayers may invest in an SSF from January 1, 2020, to December 31, 2024 (5 years). There is no requirement for continual purchase of SSF units, unlike the rules for LTF or RMF investments. Taxpayers are eligible to receive tax incentives in any year that they invest in an SSF.
  • There is no restriction on the holding period for SSF units. However, to enjoy tax benefits, the taxpayer must hold SSF units for a continual period of not less than 10 years from the date of purchase (except where the taxpayer becomes incompetent or deceased). If a taxpayer sells the SSF units before 10 years have elapsed, they will have to file an amended personal income tax return for the period that the tax exemption was claimed and pay additional tax with a surcharge of 1.5% per month (capped at the additional tax payment amount). Capital gains derived from the sale of SSF units will also be subject to tax in the year that they are sold.
  • The taxpayer must retain the certificate of investment in the SSF issued by the asset management company to support the tax exemption.
  • The taxpayer may transfer an investment in one SSF to another SSF. The transfer must be made within five working days of the SSF receiving an order to transfer from the taxpayer; otherwise, the investment period of 10 years will not be continued.

The major differences in the tax incentive conditions of SSF, LTF, and RMF investments are summarized in the table below.

Related Professionals

Practices

Tax

Location

RELATED INSIGHTS​ 

November 25, 2021
On September 30, 2021, Thailand’s Revenue Department released a notification prescribing country-by-country (CBC) transfer pricing reporting requirements for multinational enterprise (MNE) groups that do business in Thailand. The Notification of the Director-General of the Revenue Department Re: Income Tax (No. 408) applies to accounting periods beginning on or after January 1, 2021, with the CBC report submitted at the same time as the annual corporate income tax (P.N.D. 50) filing (i.e., within 150 days of the end of the accounting period). For example, if the accounting period ends on December 31, 2021, the CBC report must be filed by May 30, 2022. Background The CBC report functions as part of a three-tier structure, together with a global master file and a local file, as recommended by the OECD’s Base Erosion and Profit Sharing (BEPS) Action 13 report (Transfer Pricing Documentation and Country-by-Country Reporting). The CBC reporting requirement targets large MNEs, with the aim of encouraging international tax transparency, improving tax authorities’ access to information on MNEs’ global allocation of income and taxes paid, and helping governments to assess high-level transfer pricing risks and conduct economic and statistical analysis. The CBC reporting requirement will allow Thailand to exchange tax and financial information on an automatic basis with other signatories of the Multilateral Convention on Mutual Administrative Assistance on Tax Matters. This goes in tandem with the recently passed Act Amending the Revenue Code (No. 54) B.E. 2564 (2021), which empowers the director-general of the Revenue Department to exchange information with competent authorities in other jurisdictions. Entities Required to Submit CBC Reports The CBC report notification applies to MNE groups that do business in Thailand and at least one other jurisdiction and that have consolidated group revenue of at least THB 28 billion (approx. USD 847.6 million) in a 12-month accounting
Read More
November 24, 2021
Attorneys from Tilleke & Gibbins have provided the latest update to the Thailand contribution to Doing Business in…, a Q&A-style guide published by Thomson Reuters Practical Law that presents an overview of the legal framework for doing business in 63 jurisdictions worldwide. The Thailand chapter of the guide outlines Thailand’s legal system and key laws applicable to foreign companies doing business in the country. The chapter specifically covers the following main topics: Legal system: Thailand’s court system and codified legal system. Foreign investment: Lists of reserved business activities, restrictions on doing business with certain jurisdictions, exchange controls and currency regulations, and grants and incentives available to investors. Business vehicles: Ordinary partnerships, registered ordinary partnerships, limited partnerships, private limited companies, and public companies. Environment: Main laws and regulations, factory operation. Employment: Laws, employment contract requirements, work permits, and termination and redundancy. Tax: Taxes on employment, tax and nontax resident employees and businesses, corporate income tax, value added tax, special business tax, municipal tax, stamp duty, dividends, interest, intellectual property royalties. Competition: Important aspects of Thailand’s regulatory regime surrounding competition, centered around the updated Trade Competition Act. Antibribery and corruption: Laws, compliance requirements, regulatory authority. Intellectual property: Patents, trademarks, registered and unregistered designs, and copyright. Marketing agreements and advertising: Regulation of marketing agreements, Thailand’s Consumer Protection Act, direct marketing, role of the Consumer Protection Board and Food and Drug Administration. E-commerce: E-commerce laws and regulations, marketing and sales via online platforms. Data protection: An outline of Thailand’s Personal Data Protection Act. Product liability: Procedures and regulations for product liability and product safety, including the Unsafe Goods Liability Act and the Consumer Case Procedure Act. Product liability: Key regulatory authorities for trade competition, environmental issues, and financial services. To browse, download, or print the Thailand chapter, please visit the Practical Law website.
Read More
October 25, 2021
Michael Ramirez, a counsel in Tilleke & Gibbins’ dispute resolution group in Bangkok, has updated the firm’s contribution to the Global Attorney-Client Privilege Guide, published by Lex Mundi. The newly expanded guide provides information on what constitutes attorney-client privilege in over 70 countries around the world. The Thailand section of the guide contains in-depth information on the function and applications of attorney-client privilege in Thailand (or, as explained in the guide, an equivalent concept enshrined in Thai law), including coverage of the following topics: Privilege in corporations Common interest doctrine Litigation funding Crime-fraud exception Work product doctrine/litigation privilege Other privileges including mediation, accountant-client and settlement negotiation The interactive guide features expert contributions by Lex Mundi member firms from jurisdictions worldwide. Readers can browse the contributions, generate country-specific reports, and compare attorney-client privilege in multiple jurisdictions. For more information, please visit the Lex Mundi website.
Read More
October 14, 2021
As part of its membership in Lex Mundi, Tilleke & Gibbins has published an updated edition of its Guide to Doing Business in Thailand for 2021. This guide outlines all of the key factors for starting and operating a business in the Thai market. Issues covered include: Investment incentives Financial facilities Exchange controls Import and export regulations Structures for doing business Requirements for the Establishment of a Business Operation of the Business Cessation or Termination of the Business Labor legislation, relations, and supply Tax Immigration requirements This publication is part of Lex Mundi’s Guides to Doing Business series prepared by member firms in more than 100 jurisdictions worldwide. The guides serve as a useful resource when planning an international business strategy or researching a new market.
Read More