On 30 July 2024, the Thailand Government resolved to amend the personal tax allowances for resident individuals who invest in Thailand ESG Mutal Funds for Sustainability during the 2024 - 2026 years.

This Tax Insight has been updated for the Government's Resolution*.

ESG Mutual Funds for Sustainability

Thai ESG Mutual Funds for Sustainability are mutual funds established under the law governing securities and the stock exchange for people to invest in Thailand listed public companies, which enhance the country's sustainability by operating their businesses with ESG objectives and goals for the Environment, Society and Governance, including the reduction of greenhouse gas emissions.

The Tax Allowances Under Ministerial Reg No 390

For the purposes of encouraging the long-term savings of resident individuals, Ministerial Reg No 390 entitles resident individuals investing in Thai ESG Mutal Funds to the following personal income tax allowances:

For investments during the period of time from/to		Tax allowances
21 Nov 2023 to 31 Dec 2032		A tax allowance deduction against income for purchases of investment units for a period of not less than 8 years, which is not more than 30% of assessable income and not more than 100,000 Baht per year, and
		An exemption from tax on income derived on redemptions of the investment units not less than 8 years after their purchase date.

The Government's Resolution*

The Government's Resolution on 30 July 2024 amends the above tax allowances for the 2024 - 2026 years, as follows:

For investments during the period of time from/to		Tax allowances
01 Jan 2024 to 31 Dec 2026		A tax allowance deduction against income for purchases of investment units for a period of not less than 5 years, which is not more than 30% of assessable income and not more than 300,000 Baht per year, and
		An exemption from tax on income derived on redemptions of the investment units not less than 5 years after their purchase date.

* A Government's Resolution is not law. This Tax Insight will be updated again after the applicable law has been issued and gazetted.

Rules, Procedures and Conditions

For the deduction from assessable income for the purchase of investment units in Thai ESG Mutual Funds:

1. The investment units shall be purchased in Thai ESG Mutual Funds that are established under the securities and stock exchange laws;
2. The purchases shall be made by a resident individual, not by a non-juristic partnership, body of persons, or an estate;
3. The purchases shall be made during the period from 21 Nov 2023 to 31 Dec 2032;
4. The purchased investment units shall be held for not less than 8 years from the date of purchase of the investment units;
5. The Revenue Department's additional rules, procedures and conditions shall be complied with; and
6. In the case the rules, procedures and conditions are not complied with, the entitlement to the tax deduction will be lost and income tax shall be paid for the tax deductions claimed.

For the exemption from income tax on income that is derived when redeeming the investment units in Thai ESG Mutual Funds:

1. The exemption from income tax shall be only for the amount of income that is derived when redeeming investment units which were purchased from 21 Nov 2023 to 31 Dec 2032,
2. For which the tax deduction entitlement has been claimed, and
3. Only after the investment units have been held for at least 8 years from the date of purchase.

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