To lock in long-term investment for future use after the retirement years. Since after the retirement years you may not have regular income anymore; however, you will still need to spend on a daily basis.
This is simply a tax saving funds. The RMF is different from other mutual funds in the way that it could be used to deduct from your total annual income before personal tax calculation up to 500,000 Baht per year.
Tax Privileges and Investment Conditions
- Investors need to invest in this fund every year at minimum 5,000 baht or 3% of total annual income per year, whichever is lower, and maximum 15% of total annual income but not more than 500,000 baht per year (inclusive of provident fund or pension fund).
- Investors cannot redeem the RMFs before the ages of 55 and should invest in the fund every year.
- Investors can only redeem the units of RMFs and get exemption on the capital gains when they have held the units for MORE THAN FIVE YEARS and are AT LEAST FIFTY FIVE YEARS OLD. The exceptions are when they die or become physically disabled.
- If the investors stop investing in RMFs for 2 consecutive years or redeem the units of RMFs before the specified time, either partially or in whole, they need to repay the tax amount saved in the previous 5 years to the Revenue Department. In additional, the investors have to calculate the capital gains on investment and include them as an income in their next personal income tax filing.
- Units of RMFs cannot be transferred, exchanged, disposed of or used as collaterals at all.
To promote long term investment in Stock market via mutual funds. Long Term Equity Fund (LTF) is equity mutual fund that giving special tax privilege to individual investors. Amount purchase of LTF can be used to deduct up to 15% of your annual income but not exceeding 500,000 Baht per annum.
Tax Privileges and Investment Conditions
- Amount invested in LTF each year can be used to deduct up to 15% of personal annual income but not exceeding 500,000 Baht.
- Investor must continuously hold each investment for not less than 5 calendar years.
- Principal and Capital gain (if any) received from redemption of LTF units held not less than 5 calendar years (counting on first-in first-out basis) will be tax exempt.
- LTF's tax privilege will be awarded to amount purchase within the year 2016 only. Investor must attach the official purchase certificate issued by the asset management company with personal tax filing form for tax deduction.
- Units of LTFs can not be transferred, exchanged, pledged, or use as collaterals to all.
