How to get a tax deduction documents with Roojai?
After you have purchased your health or accident insurance with Roojai, and you wish to use your insurance premium to reduce your tax obligation, you may follow the steps below to complete your deduction process.
- When buying an insurance policy with Roojai, select the option to exercise your right for income tax deduction.
- During the tax season, login to the Roojai Mobile app or MyAccount and click on policies.
- Select your policy and download the tax deduction documents from the Download Documents section.
- Use the tax document to apply for your tax deduction.
Note: Personal Accident Insurance customers will receive an SMS and email from Roojai with the tax deductible amount.
What is an insurance tax deduction in Thailand?
An insurance tax deduction is a way to reduce your tax obligation. According to the Thai tax law, any health insurance premium, up to a maximum of THB 25,000 is allowed as a deduction if the purchased policy is for the benefit of the taxpayer's own health. The sum is up to 15,000 THB for policies covering parents and parents-in-law. These conditions are defined by the Revenue Department regulations.
What is different between a tax deduction and a tax credit?
Tax deductions and tax credits are very similar in that they are both tools for helping tax payers reduce their tax obligations. However, they function slightly differently.
A tax deduction decreases the amount of income that a tax payer can be taxed on. Deductions are based on contributions, donations, insurance policies and other eligible expenses that may be subtracted from the total income.
For example*, if you purchase an insurance policy with a premium of 10,000 THB and your annual income is 480,000 THB, your remaining taxable income will be reduced to 470,000 THB.
A tax credit decreases the amount of actual taxes you must pay. Tax credits are based on personal situations such as educational costs, high family expenses, and other individual circumstances, depending on the country's tax code.
For example*, suppose you are financially caring for both of your parents and are eligible for a 2,500 THB tax credit. In that case, you may use this to reduce the taxes you owe directly. If you owe 8,000 THB in taxes, by applying the 2,500 THB tax credit, you would only owe 5,500 THB in taxes.
Which tax deductions can I claim if I have an insurance policy?
You may claim a tax deduction on any life or health-related insurance premiums purchased within the tax year. Health-related insurance includes cancer insurance, critical illness insurance and personal accident insurance (Depends on the plan of your choice).
How is a tax deduction calculated for an insurance policy?
The deduction amount for an insurance policy can be calculated as such:
Subtract the total amount of insurance premium paid within a tax year from your total annual income for a tax year, which will equal your new amount of taxable income. This is further demonstrated with the simple formula below*;
Total annual income - Total health premium paid within a tax year = Total taxable income
Do tax deductions increase your refund?
Yes, tax deductions may increase your tax refund. When someone claims for a tax deduction, the amount of income that can be taxed decreases. This makes the overall tax liability smaller and the tax payer may owe less in taxes for that particular tax year. Suppose the amount of withheld tax from someone's pay in a tax year is greater than the reduced tax liability from deductions. In that case, the tax payer will be eligible for a bigger tax refund.
For example*, if your salary is 40,000 THB per month and you are taxed at 15%, you would have 6,000 THB withheld which would equal 72,000 THB total withheld for a tax year. By applying a 10,000 THB tax deduction on your annual salary of 480,000 THB, you would have 470,000 THB in taxable income. Your new taxable income of 470,000 THB subject to 15% tax would mean only 70,500 THB total withheld for a tax year. However, since you have had already 72,000 THB total withheld from your annual pay, you would be eligible for a 1,500 THB tax refund.
The formula below highlights this example;
- Monthly salary of 40,000 THB * withheld tax rate of 15% = withheld tax of 6,000THB
- Withheld tax of 6,000THB * 12 months or 1 tax year = 72,000 THB withheld for tax year
- Monthly salary of 40,000 THB * 12 months = 480,000 annual taxable income
- Annual salary of 480,000 – Total insurance premium paid in tax year of 10,000 THB = new annual taxable income of 470,000 THB
- New annual taxable income of 470,000 THB * 15% tax = updated 70,500 THB withheld for a tax year
- Initial tax withheld from annual salary of 72,000 THB – updated 70,500 THB of withheld tax = 1,500 THB tax refund
Can tax deductions be claimed from multiple insurance policies?
Yes, you may apply for a tax deduction from multiple health-based insurance policies as long as the policy is for the health benefit of the taxpayer and the maximum insurance premium does not exceed 25,000 THB. Additionally, a taxpayer may apply for a tax deduction from multiple health-based insurance policies that were purchased for the taxpayer's parents or the spouse's parents, and the maximum insurance premiums do not exceed 15,000 THB
What are the tax-deductible benefits from Roojai insurance?
Roojai allows you to apply for a tax deduction seamlessly and easily without having to look around for your old policy documents or spend time calculating your total paid premium for a tax year. The tax deduction process with Roojai is simplified as such;
- Review all your total paid insurance premium for a tax year online in your MyAccount
- Check the tax-deductible amount directly from MyAccount.
- Enjoy a streamlined and transparent process that reduces your time on calculations or multiple submissions by applying for a tax deduction through Roojai Mobile App.
Note: Personal Accident Insurance customers will receive an SMS and email from Roojai with the tax deductible amount.
Where can I find my tax deductible details?
You may visit Roojai's MyAccount and click the Tax Deduction button.
*The calculations presented above are illustrative only and shall not be deemed as tax advice. Taxpayers have the responsibility to ensure the accuracy of their tax calculations and filings by following Revenue Department regulations.
