Myanmar / BURMA personal Income Tax
Income from salaries is taxed at progressive rates between 3% - 30% in Myanmar. Income from other sources are taxed between 5% - 40% in Myanmar, as shown below:
- Salary: Progressive rates ranging from 3% - 30% (30% on income exceeding Kyat 500,001)
- Professional income, business income, property income, income from other sources and income from undisclosed sources of Individual: Progressive rates ranging from 5% - 35% (35% on income exceeding Kyat 2,000,001)
- Salary: Progressive rates ranging from 3% - 30% (30% on income exceeding Kyat 500,001)
- Professional income, business income, property income, income from other sources and income from undisclosed sources of Individual: Progressive rates ranging from 5% - 35% (35% on income exceeding Kyat 2,000,001)
- Individual foreigners engaged under special permission in a State sponsored project, enterprise or any undertaking: 20%
- Income earned abroad by non-resident citizen (On gross income): 10%
- Income earned by resident foreigner: 15%
- Capital gain (Resident): 10%
- Capital gain (Non-resident Foreigner): 40%
- Non-resident foreigners (Individual and bodies of individuals such as a branch of a foreign company): Flat 35% or the progressive rates mentioned above, whichever is greater
- Cooperative Societies: Progressive rates ranging from 3% - 30% (30% on income exceeding Kyat 500,001)
Tax Allowances
There is a basic allowance of 20% up to a maximum of Kyat 12,000, and a family allowance for wife and children. There also is an allowance for insurance premiums paid on the taxpayer's own life or the life of his or her spouse. Also payment contributions towards saving funds as prescribed by the rules are deductible. The child allowance is applicable if the child is unmarried and under 18 years of age or if the child is over age 18 and is receiving full-time education.
Family allowance for wife and children is as follows:
- Wife allowance (having no taxable income): Kyat 5,000
- For each child under 5 years: Kyat 1,000
- For each child above 5 but under 10 years: Kyat 1,200
- For each child above 10 but under 15 years: Kyat 1,600
- For each child above 15 years: Kyat 2,000
Salary income also includes perquisites and any benefits; for instance, the rental value of free accommodations is usually calculated at 10% of the employee's gross salary or at 12.5% if the accommodation is furnished. If the employer pays the employee's tax, a tax on tax basis of assessment is adopted. Income tax is withheld monthly and paid within seven days to tax office.
Income from Salaries
Income to be show under the head Salaries shall include salary, wages, pension, bonus, fees, commissions received or receivable by the assessee, and in addition shall include perquisites or profits such as the annual value of rent-free accommodation provided to the assessee by his employer, any sum of money paid on behalf of the assessee by his employer, any sum contributed on his behalf by an employer into the provident fund recognized for income tax purpose and interest thereon, but does not include any interest received from his own contribution to the Government Provident Fund.
Income from Business
A Statement of accounts including the Manufacturing Account, the Trading Account, the Profit and Loss Account, and the Balance Sheet for the relevant year concerning the business of the assessee shall be attached to this return of income. As depreciation allowance may be claimed in respect of capital assets owned and used by the assessee in the business, particulars of the capital assets are to be furnished in the prescribed form.
Myanmar Tax Year
Income of tax payer is computed on the basis of one fiscal year (April 1 to March 31 of the following year). The fiscal year in which income is received is expressed as "income year" and the year following as "assessment year".
Tax Rates for Expatriate Employees
The progressive tax rates applicable to salary range from 3% to 30%. However, non-resident foreigners that derive a salary from Myanmar are subject to a flat rate of 35%.
Furthermore, when a resident foreigner receives salary in any foreign currency, this is subject to tax at a flat rate of 15% on such gross salary. By the same token, if a resident foreigner derives income from employment for a project with special permission of the government in any government owned project or a project that is sponsored by the government, a flat rate of 20% is levied on the gross salary in kyats while a 15% rate applies to the gross salary paid in a foreign currency. Foreign invested companies may apply a final tax of 10% to salary paid to expatriate employees which are resident foreigners, provided the salary is paid in a foreign currency. The same does not apply for salary paid in local currency. The latter triggers tax at progressive tax rates from 3% to 30%.
A resident foreigner or a resident citizen is subject to tax on all income derived from sources within the Union of Myanmar and on income from sources outside the Union of Myanmar. In the case of an enterprise operating under the Union of Myanmar Foreign Investment Law, the tax is payable only on income derived from sources within the Union of Myanmar.
A non-resident foreigner is subject to tax on all income from sources in Myanmar.
A resident foreigner is:
(a) a foreigner who lives in Myanmar for not less than 183 days during the income year,
(b) a company formed under the Myanmar Companies Act or any other existing Myanmar Law wholly or partly with foreign share holders.
(c) an Association of persons other than a company formed wholly or partly with foreigners and where control, management and decision making of its affairs are situated and exercised wholly in the Union of Myanmar.
A foreigner or a foreign organization who is not a resident in Myanmar is classified as a non resident. A branch company is treated as a non-resident. However, this classification is irrelevant to an enterprise operating under the Union of Myanmar Foreign Investment Law.
Social Security Contributions
Myanmar has a compulsory system of social security contributions. Only employers with more than 5 employees are within the scope of the system. The contribution is calculated as 1.5% of the total salary (including benefits). It is actually the employer who must deduct the contribution from the employee's salary and remit the amount to the authorities.
Tax Compliance Obligations
All persons deriving income from Myanmar must file tax returns and comply with monthly payment and declaration requirements. This applies to foreigners that are non-residents, resident foreigners and national employees. The employer must also provide an annual finalization statement of salaries paid to employees.
- Income earned abroad by non-resident citizen (On gross income): 10%
- Income earned by resident foreigner: 15%
- Capital gain (Resident): 10%
- Capital gain (Non-resident Foreigner): 40%
- Non-resident foreigners (Individual and bodies of individuals such as a branch of a foreign company): Flat 35% or the progressive rates mentioned above, whichever is greater
- Cooperative Societies: Progressive rates ranging from 3% - 30% (30% on income exceeding Kyat 500,001)
Tax Allowances
There is a basic allowance of 20% up to a maximum of Kyat 12,000, and a family allowance for wife and children. There also is an allowance for insurance premiums paid on the taxpayer's own life or the life of his or her spouse. Also payment contributions towards saving funds as prescribed by the rules are deductible. The child allowance is applicable if the child is unmarried and under 18 years of age or if the child is over age 18 and is receiving full-time education.
Family allowance for wife and children is as follows:
- Wife allowance (having no taxable income): Kyat 5,000
- For each child under 5 years: Kyat 1,000
- For each child above 5 but under 10 years: Kyat 1,200
- For each child above 10 but under 15 years: Kyat 1,600
- For each child above 15 years: Kyat 2,000
Salary income also includes perquisites and any benefits; for instance, the rental value of free accommodations is usually calculated at 10% of the employee's gross salary or at 12.5% if the accommodation is furnished. If the employer pays the employee's tax, a tax on tax basis of assessment is adopted. Income tax is withheld monthly and paid within seven days to tax office.
Income from Salaries
Income to be show under the head Salaries shall include salary, wages, pension, bonus, fees, commissions received or receivable by the assessee, and in addition shall include perquisites or profits such as the annual value of rent-free accommodation provided to the assessee by his employer, any sum of money paid on behalf of the assessee by his employer, any sum contributed on his behalf by an employer into the provident fund recognized for income tax purpose and interest thereon, but does not include any interest received from his own contribution to the Government Provident Fund.
Income from Business
A Statement of accounts including the Manufacturing Account, the Trading Account, the Profit and Loss Account, and the Balance Sheet for the relevant year concerning the business of the assessee shall be attached to this return of income. As depreciation allowance may be claimed in respect of capital assets owned and used by the assessee in the business, particulars of the capital assets are to be furnished in the prescribed form.
Myanmar Tax Year
Income of tax payer is computed on the basis of one fiscal year (April 1 to March 31 of the following year). The fiscal year in which income is received is expressed as "income year" and the year following as "assessment year".
Tax Rates for Expatriate Employees
The progressive tax rates applicable to salary range from 3% to 30%. However, non-resident foreigners that derive a salary from Myanmar are subject to a flat rate of 35%.
Furthermore, when a resident foreigner receives salary in any foreign currency, this is subject to tax at a flat rate of 15% on such gross salary. By the same token, if a resident foreigner derives income from employment for a project with special permission of the government in any government owned project or a project that is sponsored by the government, a flat rate of 20% is levied on the gross salary in kyats while a 15% rate applies to the gross salary paid in a foreign currency. Foreign invested companies may apply a final tax of 10% to salary paid to expatriate employees which are resident foreigners, provided the salary is paid in a foreign currency. The same does not apply for salary paid in local currency. The latter triggers tax at progressive tax rates from 3% to 30%.
A resident foreigner or a resident citizen is subject to tax on all income derived from sources within the Union of Myanmar and on income from sources outside the Union of Myanmar. In the case of an enterprise operating under the Union of Myanmar Foreign Investment Law, the tax is payable only on income derived from sources within the Union of Myanmar.
A non-resident foreigner is subject to tax on all income from sources in Myanmar.
A resident foreigner is:
(a) a foreigner who lives in Myanmar for not less than 183 days during the income year,
(b) a company formed under the Myanmar Companies Act or any other existing Myanmar Law wholly or partly with foreign share holders.
(c) an Association of persons other than a company formed wholly or partly with foreigners and where control, management and decision making of its affairs are situated and exercised wholly in the Union of Myanmar.
A foreigner or a foreign organization who is not a resident in Myanmar is classified as a non resident. A branch company is treated as a non-resident. However, this classification is irrelevant to an enterprise operating under the Union of Myanmar Foreign Investment Law.
Social Security Contributions
Myanmar has a compulsory system of social security contributions. Only employers with more than 5 employees are within the scope of the system. The contribution is calculated as 1.5% of the total salary (including benefits). It is actually the employer who must deduct the contribution from the employee's salary and remit the amount to the authorities.
Tax Compliance Obligations
All persons deriving income from Myanmar must file tax returns and comply with monthly payment and declaration requirements. This applies to foreigners that are non-residents, resident foreigners and national employees. The employer must also provide an annual finalization statement of salaries paid to employees.
Myanmar / BURMA Corporate Taxataion
Myanmar corporate income tax rate is 30%.
The flat corporate tax rate of 30% is charged on the income of companies formed in Myanmar under the Myanmar Companies Act or any other existing Myanmar Law, enterprises operating under the Union of Myanmar Foreign Investment Law, and foreign organizations engaged under special permission in a State-sponsored project, enterprise or any undertaking. A branch of a foreign company in Myanmar is liable to pay income tax at the rate of 35% on the total income or at a progressive rate of 5% to 40% whichever is greater. There is no withholding tax on dividends.
Corporate tax rate in Myanmar is same for all kind of corporations regardless of their size.
- Companies formed in Myanmar under the Myanmar Companies Act or any other existing Myanmar Law: 30%
- Enterprise operating under the UMFIL: 30%
- Foreign organization engaged under special permission in a State sponsored project, enterprise or any undertaking: 30%
The capital gains tax rate is a flat 10% on the profit derived by residents form the sale of immovable property, fixed assets and motor vehicles if the sale price exceeds Kyat 50,000. But for non-resident foreigners, the tax rate is 40% on capital gains. Payment on income such as interests, royalties and on contracts are subject ot withholding tax at various rates ranging from 2.5% to 20%.
There are exemptions form income tax. Dividends received are exempted from income tax, and such income is not treated as part of the total income of the recipient. There are also provisions for the exemption of income tax, particularly as incentives for newly established enterprises.
Carry Forward of Loss
A loss not being a capital loss or a share of loss from a source of income can be set off against profits from the remaining sources of income in the same year Unabsorbed loss can be carried forward and set off against profits in the following there consecutive years.
Customs Duties
With a few exceptions, all imported goods are liable to customs duties.
As for exports, tax is levied on export of a few commodities namely: rice and rice flour, rice bran, rice dust, oil cakes, pulses and cereals, bamboo and raw hides and skins.
The flat corporate tax rate of 30% is charged on the income of companies formed in Myanmar under the Myanmar Companies Act or any other existing Myanmar Law, enterprises operating under the Union of Myanmar Foreign Investment Law, and foreign organizations engaged under special permission in a State-sponsored project, enterprise or any undertaking. A branch of a foreign company in Myanmar is liable to pay income tax at the rate of 35% on the total income or at a progressive rate of 5% to 40% whichever is greater. There is no withholding tax on dividends.
Corporate tax rate in Myanmar is same for all kind of corporations regardless of their size.
- Companies formed in Myanmar under the Myanmar Companies Act or any other existing Myanmar Law: 30%
- Enterprise operating under the UMFIL: 30%
- Foreign organization engaged under special permission in a State sponsored project, enterprise or any undertaking: 30%
The capital gains tax rate is a flat 10% on the profit derived by residents form the sale of immovable property, fixed assets and motor vehicles if the sale price exceeds Kyat 50,000. But for non-resident foreigners, the tax rate is 40% on capital gains. Payment on income such as interests, royalties and on contracts are subject ot withholding tax at various rates ranging from 2.5% to 20%.
There are exemptions form income tax. Dividends received are exempted from income tax, and such income is not treated as part of the total income of the recipient. There are also provisions for the exemption of income tax, particularly as incentives for newly established enterprises.
Carry Forward of Loss
A loss not being a capital loss or a share of loss from a source of income can be set off against profits from the remaining sources of income in the same year Unabsorbed loss can be carried forward and set off against profits in the following there consecutive years.
Customs Duties
With a few exceptions, all imported goods are liable to customs duties.
As for exports, tax is levied on export of a few commodities namely: rice and rice flour, rice bran, rice dust, oil cakes, pulses and cereals, bamboo and raw hides and skins.
Myanmar / BURMA commercial tax Rates
Myanmar has a Commercial Tax payable on goods, imported or produced in Myanmar, trading sales, and services ranging from 0% - 200%. Excluding the tax on luxury items, the general rates of Commercial Tax in Myanmar is between 5% - 30%.
The Commercial Tax Law will be replaced by a more advanced and sophisticated value added tax (VAT) in the future.
Commercial Tax is turnover tax levied on goods either domestically produced or imported. It is also levied on services such as transport of passengers, entertainment, trading, operation of hotels, lodging and enterprises engaged in sale of foods and drinks.
For goods and services supplied in Myanmar, commercial tax is imposed at the time of supply. For the import of goods, commercial tax is collected by the Customs Department at the point of importation in the same manner that customs duties are collected.
Commercial tax is levied according to the Schedules appended to the said Law. Briefly, the schedules are as follows:
1. Schedule I details tax free items which comprises 65 essential and basic commodities
2. Schedule II to V specify tax rates ranging from 5% to 25% depending on the nature of the goods produced within Myanmar
3. Schedule VI is for specific types of commodities such as cigarettes, fuel oil, liquor, jade and gems on which tax is chargeable at rates ranging from 30% to 200%
4. Schedule VII is applicable to services including trade services.
The commercial tax rates for services are as follows:
- 5% on trading;
- 8% on passenger transport fares,
- 10% on hotel, lodging and reataurant services;
- 15% on other forms of public entertainment; and
- 30% on movie or cinema shows.
The Commercial Tax Law will be replaced by a more advanced and sophisticated value added tax (VAT) in the future.
Commercial Tax is turnover tax levied on goods either domestically produced or imported. It is also levied on services such as transport of passengers, entertainment, trading, operation of hotels, lodging and enterprises engaged in sale of foods and drinks.
For goods and services supplied in Myanmar, commercial tax is imposed at the time of supply. For the import of goods, commercial tax is collected by the Customs Department at the point of importation in the same manner that customs duties are collected.
Commercial tax is levied according to the Schedules appended to the said Law. Briefly, the schedules are as follows:
1. Schedule I details tax free items which comprises 65 essential and basic commodities
2. Schedule II to V specify tax rates ranging from 5% to 25% depending on the nature of the goods produced within Myanmar
3. Schedule VI is for specific types of commodities such as cigarettes, fuel oil, liquor, jade and gems on which tax is chargeable at rates ranging from 30% to 200%
4. Schedule VII is applicable to services including trade services.
The commercial tax rates for services are as follows:
- 5% on trading;
- 8% on passenger transport fares,
- 10% on hotel, lodging and reataurant services;
- 15% on other forms of public entertainment; and
- 30% on movie or cinema shows.
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