Step-by-step calculation
This walk-through covers how a Myanmar tax resident can claim donations against PIT. Default: single, no dependant allowances, paid in MMK on a 12-month salary. Brackets are from the Union Tax Law 2025-2026 (Section 5). Tax year: 1 April – 31 March. The Income Tax Law allows donations to government-approved organisations as a deduction, capped to a percentage of total income; the cap, the list of approved bodies, and the receipt requirements are set in IRD circulars.
Step 1 — Apply the 20% basic personal relief and donation deduction
Sequence: gross → less 20% basic relief → less spouse / child / parent allowances → less donation (within cap) → taxable income. The donation cap is typically a percentage of total income; the deduction never exceeds the actual donation.
| Annual gross salary | (figure) |
| Less: 20% basic personal relief | − up to MMK 10,000,000 |
| Less: spouse / child / parent allowances | 0 in default case |
| Less: approved donation (within IRD cap) | − up to cap |
| Annual taxable income | = residual |
Step 2 — Apply the Union Tax Law 2025-2026 brackets
| Annual taxable income | Marginal rate |
|---|---|
| 1L – 20L (MMK 0 – 2,000,000) | 0% |
| 20L – 100L (MMK 2,000,000 – 10,000,000) | 5% |
| 100L – 300L (MMK 10,000,000 – 30,000,000) | 10% |
| 300L – 500L (MMK 30,000,000 – 50,000,000) | 15% |
| 500L – 700L (MMK 50,000,000 – 70,000,000) | 20% |
| 700L & above (MMK 70,000,000+) | 25% |
Worked illustration — gross MMK 10,000,000 with a MMK 250,000 donation to an approved religious organisation:
| Step | Amount (MMK) |
|---|---|
| Annual gross | 10,000,000 |
| Less: 20% basic relief | − 2,000,000 |
| Less: approved donation (within cap) | − 250,000 |
| Taxable | 7,750,000 |
| 0% band (first 2M) | 0 |
| 5% band (next 5,750,000) | 287,500 |
| Annual PIT | MMK 287,500 |
Without the donation, PIT would be MMK 300,000. Tax saved on the MMK 250,000 donation: MMK 12,500 (5% marginal rate).
Step 3 — Convert to monthly withholding
- Adjust PAYE when a regular monthly donation is in place (e.g., MMK 20,833/month).
- Lump-sum donation — usually claimed on the annual return, not monthly PAYE.
- Document the receipt from the approved organisation; retain with the annual return.
What about SSB and the true net salary?
Donations have no effect on SSB — contributions are 2% employee + 3% employer on the MMK 300,000 wage base, capped at MMK 6,000/MMK 9,000 per month respectively. The wage base is gross salary regardless of any donation deduction the employee claims for PIT.
Employer takeaway
Donations to organisations approved by the Ministry of Planning and Finance are deductible under Myanmar PIT, subject to the IRD-prescribed cap. Capture the donation receipt for the tax file, apply the deduction on the annual return (or monthly PAYE for regular donations), and remit PIT to IRD by the 15th of the following month. File the annual reconciliation by 30 June and retain donation receipts and approval evidence for at least 7 years.
Common variations to watch for
- Religious donations to recognised institutions — generally deductible if the institution is on the IRD list.
- Disaster relief through approved channels — typically deductible at the IRD-prescribed terms.
- Donations in kind — fair market value; subject to additional documentation.
- Donations to overseas organisations — generally not deductible unless specifically approved.
- Donations in employer's name — may not entitle the employee to a personal deduction.
Common PIT mistakes to avoid
- Donating without a receipt from an approved organisation — IRD will disallow.
- Claiming above the cap — only the in-cap portion is allowed.
- Forgetting to keep evidence for at least 7 years. See record retention.
- Stacking on dependant allowances incorrectly — sequence matters. See PIT calculation overview.
We publish practical, legally-grounded HR guidance for Myanmar employers. Each piece is reviewed by our compliance team against current MLIP and Labor Law requirements.