What is Form ล.ย.01? A Withholding Tax Reduction Form That Helps Salaried Employees Keep More Money

In 2026, Thailand is experiencing stagflation—a situation where the economy slows down while inflation rises sharply—mainly driven by crude oil prices holding steady between 88 and 100 US dollars per barrel. This directly affects the cost of living and prices of consumer goods, making financial tightness a common issue for almost all salaried workers.

One key strategy that many may overlook is managing "cash flow." In terms of tax planning, this can be done through a form called ล.ย.01, which is essential for helping us increase the money left in our pockets each month without having to wait until the next year's tax refund.

Understanding Form ล.ย.01: A tool to "stop" excessive withholding tax deductions.

Form ล.ย.01, or the "Declaration for Tax Deduction" form, is issued by the Revenue Department for employees to notify their employers or HR of their eligible tax deduction rights.

Normally, employers deduct withholding tax monthly from salaries. Without submitting Form ล.ย.01, employers calculate tax based only on basic rights, such as a personal deduction of 60,000 baht and social security contributions, resulting in excessive tax withholding and reducing net salary more than necessary.

Submitting Form ล.ย.01 acts as a "calibration" of the withholding tax amount to closely match the actual annual tax liability, increasing liquidity for spending and reducing the risk and hassle of requesting tax refunds at the start of the year, as well as minimizing delays in receiving refunds.

Comparison: How much difference does submitting Form ล.ย.01 make to your cash flow?

Comparison table of benefits from submitting Form ล.ย.01 for the 2026 tax year.

Note: Assumes use of deductions such as life insurance, retirement funds, and mortgage interest.

For a salary of 100,000 baht, updating information via Form ล.ย.01 can increase monthly cash in hand by up to 7,550 baht, which can immediately help manage rising fuel or product costs without waiting until 2027.

Highlights for 2026: The TISA account and new tax deductions.

In 2026, the government introduced new tax measures through the "Thailand Individual Savings Account" (TISA), an innovation salaried employees must declare on Form ล.ย.01 to maximize their benefits.

• The deduction ceiling has been raised from 500,000 baht to up to 800,000 baht per year (including retirement-related funds).
• Progressive Deduction Formula: For income not exceeding 1.5 million baht/year, investing 100,000 baht can yield a deduction of up to 130,000 baht (1.3 times the amount).
• For income exceeding 1.5 million baht/year, the deduction is limited to 0.7 times the actual purchase amount. How to correctly and transparently fill out Form ล.ย.01.

Principally, employees should complete Form ล.ย.01 by January each year, but they can submit updated versions to HR whenever significant changes to deductions occur, as detailed below.

• Basic rights section: Specify marital status (single/married), child deductions (30,000 or 60,000 baht per child depending on birth year), and parental support (parents aged 60+ with income not exceeding 30,000 baht/year).
• Insurance and savings section: State life insurance premiums (up to 100,000 baht), health insurance (up to 25,000 baht), and various funds such as RMF, Thai ESG, and TISA.
• Economic stimulus section: Mortgage interest (up to 100,000 baht), and solar panel installation (up to 200,000 baht).

Precautions and ethics in submitting information.

While Form ล.ย.01 helps increase cash on hand, accuracy is paramount.

• Honesty: Overstating rights leading to underpaid tax will result in a "surtax" penalty of 1.5 percent per month if tax is owed upon year-end filing.
• Updating information: If changes occur during the year, such as policy cancellations or fund sales, a new Form ล.ย.01 should be submitted promptly to correct withholding amounts.

Using Form ล.ย.01 demonstrates financial literacy in a tough economy. Employees should not allow excess cash to be held by the Revenue Department without return. Early tax planning builds a strong financial shield and maintains household stability amid stagflation challenges.

Click to download the Declaration for Tax Deduction Form (Form ล.ย.01): https://bit.ly/2I91kOP

Source: Revenue Department, itax

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