Forvis Mazars Payroll Flash News - July 2026
31 July 2026
New pension calculation formula for Social Security old-age benefits (CARE) has been approved by the Cabinet
On 14 July 2026, the Cabinet approved the draft Ministerial Regulation on Old-Age Benefits, introducing a new pension calculation formula known as Career Average Revalued Earnings (CARE). The new formula is expected to increase old-age pension benefits for the majority of insured persons.
Key changes under the CARE formula include:
- Improved lump-sum benefit for short contribution periods: Insured persons who have contributed for fewer than 12 months will receive the employee’s and employer’s contribution portions, together with investment returns. Currently, only the employee’s contribution portion is refunded.
| Contribution period | Current calculation | Proposed calculation |
| Fewer than 12 months | Insured person’s contributions only | Insured person’s contributions plus employer’s contributions and investment return |
| At least 12 months but fewer than 180 months | Insured person’s contributions plus employer’s contributions and investment return | No substantive change |
- Every contribution month will count: For contributions exceeding 180 months, the additional pension rate will be calculated at 0.125% for each month, replacing the current increase of 1.5% for each complete 12-month period. Consequently, incomplete years will no longer be disregarded.
| Particulars | Current formula | Proposed formula |
| Total contribution period (example) | 242 months | 242 months |
| Period exceeding 180 months | 62 months | 62 months |
| Period recognised in the calculation | 5 complete years; the remaining 2 months are disregarded | All 62 months |
| Base pension rate | 20.00% | 20.00% |
| Additional pension rate | 1.5% × 5 years = 7.50% | 0.125% × 62 months = 7.75% |
| Total pension rate | 27.50% | 27.75% |
- Career-average contribution wage: The pension base will change from the average contribution wage during the final 60 months to the average wage throughout the insured person’s entire contribution history. Historical wages will be adjusted to their present value before the average is calculated. This may also benefit individuals who previously contributed under Section 33 but later moved to Section 39, as their earlier, potentially higher contribution wages will also be considered.
| Particulars | Current formula | Simplified CARE illustration |
| Wage basis | Average wage during the final 60 months | Average wage across all 360 contribution months |
| Section 33 wages included | Not included, as they fall outside the final 60 months | THB 15,000 × 240 months |
| Section 39 wages included | THB 4,800 for the final 60 months | THB 4,800 × 120 months |
| Average contribution wage | THB 4,800.00 | (THB 3,600,000 + THB 576,000) ÷ 360 = THB 11,600.00 |
| Pension rate | 42.50% | 42.50% |
| Estimated monthly pension | THB 4,800 × 42.50% = THB 2,040.00 | THB 11,600 × 42.50% = THB 4,930.00 |
In this example, CARE increases the estimated monthly pension by THB 2,890, from THB 2,040 to THB 4,930.
- Protection for existing pensioners: Existing pensioners will receive an increase if CARE produces a higher pension. If CARE produces a lower amount, their current pension will not be reduced.
- Five-year transitional protection for new pensioners: New pensioners who retire or begin receiving the old-age pension during the first year of the CARE formula's implementation but may receive less under CARE formula, will receive full compensation for any reduction in their pension benefit for the remainder of their lifetime. For those who start receiving the old-age pension in the second year after the CARE formula takes effect, compensation will be provided at 80% of the reduced amount. The compensation rate will gradually decrease to 60% in the third year, 40% in the fourth year, and 20% in the fifth year. No compensation will be provided to individuals who begin receiving the old-age pension from the sixth year onward following the implementation of the CARE formula.
Source (in Thai):
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Rattanawan Sriwichian Senior Manager - Payroll Outsourcing - Bangkok
