Investment in LTF and RMF

How to choose the right Long Term Equity Fund (LTF) and/or Retirement Mutual Fund (RMF) for me?

Whether you choose to invest in LTF or RMF, these funds should be adjusted proportional to the level of risk that you can handle. For examples, for those who belong to a younger age group and still have a lot of time to invest, RMFs that mostly invests in equity or LTFs investing heavily in growth stocks are recommended. These two options both present a higher risk, but also give a higher yield.

On the contrary, for those who belong in a middle-aged group or plan to retire soon, RMFs that invest in bonds are recommended as they give a constant return and present relatively low risk or LTFs that invest in dividend stocks or LTFs that invest 70% in stocks and 30% in bonds.


How much can I invest in LTF/RMF?
  • LTF investment amount eligible for tax deduction is not more than 15% of your annual assessable income, and not more than 500,000 Baht.
  • RMF investment amount should not exceed 15% of your annual assessable income, and should not be more than 500,000 Baht when combined with provident funds or government pension funds and retirement insurance premium.
Can I buy LTF or RMF more than 15% of my income or the 500,000 Baht limit?
  • LTF: If you buy LTF more than 15% of your assessable income or the 500,000 Baht limit, when redeeming the units, the capital gain must be included in the annual income for income tax calculation.
  • RMF: If you buy RMF more than the specified limit, when redeeming the units, the capital gain on the exceeding portion must be included in the annual income for income tax calculation. Such capital gain is classified as income under Section 40(8) of The Revenue Code.
Breach of LTF and RMF Investment Conditions
  • LTF
In case of sale of LTF units before 7 calendar years, investors must return the tax privileges on the redeemed units and pay 1.5% surcharge per month on the tax amount. The capital gain on redemption must be included in the annual income for tax calculation. Redemption is based on “First in First out” (FIFO) basis.
  • RMF
Sale of RMF below the specified threshold is also a breach of the conditions. If this is the case, tax payments will be required for the years in which the exemption was claimed, but no longer than five years (retrospective from the year preceding the year in breach). The capital gain on redemption must be included in the annual income for tax calculation.

FAQ