Thailand: Tax relief measures in response to coronavirus (COVID-19)
Thailand: Tax relief measures, response to coronavirus
The Thai government introduced several tax relief measures in response to the coronavirus (COVID-19) outbreak. The tax relief measures include reduced withholding tax rates, an enhanced rate of deduction for interest payments made by certain taxpayers, and tax return filing extensions.
Among the tax relief measures are the following items:
- Withholding tax imposed on payment for services, hire of work, certain commissions, and professional fees will be reduced from 3% to 1.5% for the payments made from 1 April 2020 to 30 September 2020. The withholding tax will subsequently be reduced to 2% from 1 October 2020 to 31 December 2021 if the payment is made electronically.
- Eligible small and medium enterprises (SMEs) can claim a 150% deduction for interest expenses incurred on loans obtained under a funding initiative to provide THB 150 billion in soft loans to SMEs with an interest rate of 2% for the first two years.
- SMEs employers can deduct 300% of eligible salary costs paid to employees in the period from April 2020 to July 2020 for corporate income tax purposes.
- VAT payers participating in the “good exporter” program will receive VAT refunds faster than usual. VAT refunds will be granted within 15 days (compared to a normal 30-day period) if VAT returns are filed via an e-filing system and within 45 days (compared to a normal 60-day period) for paper filings.
- Individuals investing in a “super saving fund” who invest at least 65% of its net assets value in shares listed on the Stock Exchange of Thailand, during the period from 1 April 2020 to 30 June 2020 can deduct the actual investment amount, capped at THB 200,000, as an allowance for individual (personal) income tax purposes, provided that the investment in the fund will be held for at least 10 years.
- The filing deadline for individual income tax returns (form PND.90/91) is extended from 31 March 2020 (or 8 April 2020 for e-filings) to 30 June 2020.
There are also tax relief provisions available for donations given to support COVID-19 measures via the Revenue Department’s e-Donation system during 5 March 2020 to 5 March 2021.
- Individuals can claim cash donations as a deductible allowance for individual income tax purposes up to 10% of the total income after deducting all other expenses.
- Other persons can claim cash or asset donations as a deductible expense for corporate income tax purposes up to 2% of the net taxable profit.
- Donation of assets is exempt from VAT for VAT operators.
Read a March 2020 report prepared by the KPMG member firm in Thailand
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