Retirement savings required from 2018
Starting at 3% of salary rising to 10% by 10th year, matching employer & employee contributions to retirement savings to meet needs of Thailand's ageing population.
Starting at 3% of salary rising to 10% by 10th year, matching employer & employee contributions to retirement savings to meet needs of Thailand's ageing population.
GOVERNANCE
Retirement savings required from 2018
Mandatory provident fund in 2018
10/11/2016
Wichit Chantanusornsiri
The long-awaited mandatory is set to be enforced in 2018.
The new fund is an attempt to strengthen the retirement safety net and ease the government burden in the face of an ageing population.
The ratio of senior citizens aged 60 and older is projected to increase to 20% of total population in 2015 from 14% last year.
The fund is among a series of measures aimed at taking care of senior citizens approved by the cabinet this week.
Senior citizen makes a trip to the temple with her family.
HOW WILL IT WORK?
A so-called "matching step up contribution rate" will start at 3% reaching 10% from the 10th year.
What does this mean?
Under the law, employers and employees will each be required to contribute 3% of the employee's salary for the first three years to the fun.
The contribution will increase to 5% during the fourth to the sixth years, 7% between the seventh and the ninth years and 10% from the 10th year onwards, with a cap of 60,000 baht per month.
This is according to deputy director general of the Fiscal Policy Office (FPO) Warotai Kosolpisitkul.
Scouts help senior citizens in wheelchairs.
WHO MUST CONTRIBUTE?
Those aged between 15 and 60 hired by privately owned companies, state enterprises and public organisations are required to contribute to the mandatory provident fund.
Temporary employees of the state will also be obliged by law to contribute.
Employers of workers who earn below 10,000 baht a month will be the sole contributor to the fund.
With the ageing population, the government's contribution to retirement savings funds such as the SSF, the National Savings Fund and the Government Pension is expected to grow to 698 billion baht in fiscal 2024 from 290 billion in fiscal 2016.
Police helps senior citizen cross the street.
DOES NEW LAW APPLY TO ALL COMPANIES?
The law requires companies with 100 employees or more to match employees' contributions to the fund within the first four years of its enforcement.
Companies with at least 10 employees will have to offer compulsory retirement savings from the fourth year of implementation, and those with only one employee must contribute from the seventh year.
For companies offering provident funds but making a lower contribution rate than the mandatory provident fund's requirement, they must raise the contribution to comply.
MEASURES TO ENCOURAGE COMPANIES HIRE PEOPLE OVER 60
FPO deputy director Pornchai Thiraveja said a tax break for companies hiring senior citizens, building "senior complex" projects and special "reserve" mortgages also won the cabinet's approval.
Companies hiring people at aged 60 or above will be granted a double tax deduction on wages paid to senior citizen employees who earn up to 15,000 baht a month.
http://www.bangkokpost.com/business/news/1131413/mandatory-provident-fund-in-2018
สามารถฝึกอ่านออกเสียงและดูคำแปลได้ที่ : http://www.bangkokpost.com/learning/learning-from-news/1131768/retirement-savings-required-from-2018
