|
Posted Date: 5 February 2009
The Association of Investment Management Companies (AIMC) stated that the Revenue Department was being under an amendment of Ministerial Regulation concerning tax benefits to which employee members of provident funds who maintain their accrued benefits in the funds and receive annuity payment are entitled. Certain benefits are believed to be generated to employees who save for their life after retirement.
AIMC earlier reported about the Revenue Department’s reply to AIMC letter enquiring about tax benefits obtainable by fund members upon retirement at the age of not lower than 55 years and with fund membership of at least five years, who would like to maintain their accrued benefits in the funds that they may still be entitled to tax exemption under Ministerial Regulation no. 126 clause 2(36) and Notification of Director-General of the Revenue Department no. 52. This will exclude the portion of benefits arising during the investment maintaining after leaving job, which is not the portion earlier exempted from tax payment as mentioned above, and must be included in the taxable income for tax calculation pursuant to Section 40 (8) on February 2, 2009. Some members have asked AIMC whether such justification of the Revenue Department is the final conclusion on the Department’s consideration of tax issues for provident fund members.
Ms. Araya Thirakomen, AIMC Deputy Chairperson and Chairperson of Provident Fund Business Group, stated that the Revenue Department’s reply to AIMC’s enquiry was in the purview of the tax criteria currently in force. However, the Department is now considering a draft Ministerial Regulation regarding exemption of personal income tax for provident fund members who request to maintain their accrued benefits in the funds and to receive benefits in annuity payment. The Office of the SEC and AIMC have requested the Department as follows: (1) Exemption of tax on receipt of any monetary consideration or benefits obtainable by the fund members upon retirement at the age of not lower than 55 years and with fund membership of at least five years, regardless of whether they receive in one lump sum or in annuities, and (2) Exemption of tax for members leaving their job before retirement who maintain accrued benefits in the provident funds, or transfer to other provident funds and receive benefits if falling under criteria no. 1 above, whether in one lump sum or in annuities. This principle is in conformity with the result of consideration on tax benefits to members of Government Pension Fund as both types of funds are of the same nature, i.e. retirement funds. In this regard, the Revenue Department is in the process of drafting Ministerial Regulations and other relevant notifications, which would be time taking.
AIMC will accordingly inform all provident fund members and relevant parties of the enforcement of the new Ministerial Regulations. Members may keep abreast of the progress on the issuance of Ministerial Regulations and relevant notifications at thaipvd.com or contact SEC officer in charge, Khun Laddawan Chanthachote, Tel. 0-2695-9572.
|
