Tax Benefit
LTF
RMF
Retirement Mutual Fund: RMF
Retirement Mutual Fund (RMF) is a mutual fund that aims to promote savings and individual’s investment to prepare for retirement. Investors will receive tax privilege and the amount that invest in RMF must not more than 15 % of accessible income per year when combined with the contribution to provident fund or pension fund and shall not exceed 500,000 baht with holding, continuation not less than five years since the first investment and can be redeemed when the investor is 55 years of age.
Investment policy of RMF
RMF can be invest at maximum 15 % of accessible income and not exceed 500,000 baht of the tax calendar year. However, it will be include
  • Provident fund contribution
  • Pension fund contribution
  • Private teacher aid fund contribution
  • Pension Insurance premium
All the contribution or premium paid above will be include in 15 % of accessible income and not exceed 500,000 baht for tax exemption according to condition applied.
Invest at least 5,000 baht or 3% of accessible income and must invest continuously and not stop invest more than 1 year constitutively.
Can redeem after invest in RMF 5 years constitutively since first investment and at the age of 55 years except disable or die.
Tax Privilege of RMF
We can use RMF for tax exemption at the maximum amount not more than 15 % of accessible income and not exceed 500,000 baht. If investor invest according to Revenue department condition, the capital gain from investment is exempted from personal tax income.
Example 1
Accessible Income
840,000 Baht
15 % of Accessible Income
(840,000x15%)
126,000 Baht
Use RMF for tax exemption
126,000 Baht
Example 2
Accessible Income
5,000,000 Baht
15 % of Accessible Income
(5,000,000x15%)
750,000 Baht
Use RMF for tax exemption
500,000 Baht
Tax Privilege table of RMF
New personal income tax table
(From 1 January 2014 onward)
Net Income per year Max in each tier Tax rate (%) Tax in each tier Accumulate Tax in each
1 - 150,000 150,000 Exemption 0 0
150,001 - 300,000 150,000 5% 7,500 7,500
300,001 - 500,000 200,000 10% 20,000 27,500
500,001 - 750,000 250,000 15% 37,500 65,000
750,001 - 1,000,000 250,000 20% 50,000 115,000
1,000,001 - 2,000,000 1,000,000 25% 250,000 365,000
2,000,001 - 4,000,000 2,000,000 30% 600,000 965,000
4,000,001 Up - 35% - -
Tax Privilege table of RMF
Example of Tax exemption from investing in RMF
Net Accessible Income Tax 5% Tax 20% Tax 25% Tax 35%
No RMF Invest in RMF No RMF Invest in RMF No RMF Invest in RMF No RMF Invest in RMF
Accessible Income (yearly) 300,000 840,000 1,440,000 5,000,000
Less Expense
(40% but not more than 60,000 )
60,000 60,000 60,000 60,000
Income after expense 240,000 780,000 1,380,000 4,940,000
Less personal exemption 30,000 30,000 30,000 30,000
Less invest in RMF - 40,000 - 100,000 - 200,000 - 500,000
Total exemption 30,000 70,000 30,000 130,000 30,000 230,000 30,000 530,000
Net Income 210,000 170,000 750,000 650,000 1,350,000 1,150,000 4,110,000 4,410,000
Tax to pay 4,000 1,000 65,000 50,000 202,500 152,500 1,003,500 1,108,500
Tax Save - 2,000 - 15,000 - 50,000 - 175,000
Wrong condition of Invest in RMF
Subscription with wrong condition
  1. In the case of subscription more than allowance limited amount, it will be effect in the redemption of this amount. Investor must include capital gain from redemption in calculate personal income tax of that tax year as income under section 40 (8)
  2. In the case of subscription less than allowance limited amount, investor must return all tax benefit from previous 5 calendar years and must pay tax within March of next year.
Redemption with wrong condition
  1. In the case of invest in RMF more than 5 years but redeem before age 55 years old, investor must return all tax benefit from previous 5 calendar years since the year that redeem in wrong condition and have to made the tax payment within March of next year that redeem. If investor fail to make the payment within condition period, the incremental or penalty will be charge to investor.
  2. In the case of invest in RMF less than 5 years, Investor must include capital gain from redemption in calculate personal income tax of that tax year as income under section 40 (8) and return all tax benefit from previous 5 calendar years since the year that redeem in wrong condition and have to made the tax payment within March of next year that redeem.
Information of RMF before investing