BDO Flash Alert: Personal Income Tax – Domestic Shopping of the year 2023 (“Shop Dee Mee Khuen”)
07 February 2023
By Varitta Boonchom
The government has approved a personal income tax deduction of up to THB 40,000 for certain purchases of goods and services from 1 January 2023 to 15 February 2023. The purchase must be supported by a proper tax invoice under the Value Added Tax (“VAT”) regulations, except if the vendor is a non-VAT registered business operator engaged in the business of selling books, electronic books (e-books), or One Tambon One Product Program (“OTOP”) products from shops registered with the Community Development Department.
The THB 40,000 tax deduction is divided into two (2) parts:
- For the purchase of goods or services up to THB 30,000 (inclusive of VAT), the full form of tax invoice or receipt (whether in the form of a paper or e-Tax invoice, or e-Receipt) must be available.
- For the purchase of goods or services up to THB 10,000 (inclusive of VAT), the transaction must be supported by an e-Tax invoice or e-Receipt only.
The tax deduction cannot be claimed if the purchase covers the following goods or services:
- Alcohol, beer, and wine
- Car, motorcycle, and boat
- Newspaper and magazine (both paper and electronic)
- Service fee for tour and hotel accommodation
- Public utilities, electricity, telephone bill, internet bill
- Service fees covering period beyond 15 February 2023
- Non-life insurance premiums
- This is the first year that the spending on fuel for cars and motorcycles is allowed as a tax deduction.
- The name and tax ID number of the taxpayer indicated on the full form of a tax invoice or receipt must be accurate.
- For the purchase of books, electronic books (e-books), or OTOP products from a non-VAT registered shop, the receipt must include the following information:
- The name and surname of the taxpayer
- The tax ID number of the vendor
- The name or brand of the vendor
- The serial number of the book and the relevant receipt
- The issuance date of the receipt
- The amount paid on the transaction
- The type, name, amount, and price in case the price of the goods is THB 100 or more.
- The e-Tax invoice or e-Receipt must be issued by shops duly approved by the Revenue Department (The list is available here).
- The THB 40,000 spending is an allowable tax deduction, not a tax refund. Please see the effective tax benefit rates below:
Accordingly, if you have a net income of THB 600,000, your top rate is 15%. For a domestic spending of THB 40,000, the effective tax rate benefit is THB 6,000.
Issuances related to the tax deduction:
- Director General Notification No. 431 issued under the Revenue Department of Thailand
- Ministerial Regulations No. 386 (year 2022) issued under the Revenue Code on tax exemption.