Retirement Mutual Fund, RMF is one of the most suitable retirement investment tools. However, investing in RMF also has investment conditions for using various tax-deductible privileges. that we must study well. Because if the tax conditions are violated in addition to having to return the tax deduction that we have already received, also must pay fines as prescribed by the Revenue Department.

Conditions for buying RMF funds

• Can purchase up to 30% of taxable income and when combined with Savings Fund (SSF), Provident Fund and pension life insurance and not more than 500,000 baht
  
  
• Must invest in RMF regularly and continuously at least once a year.
  
  
• Must not suspend the purchase of RMF for more than 1 year, that is, it can be purchased every other year. (except for any year when there is no income so it can be an empty investment without being considered a breach of investment conditions)
  
  
• Hold investment units for at least 5 full years and do not sell until 55 years of age.
  
  
• If one of the conditions is violated will be considered a violation of the investment conditions. Investors will no longer receive tax benefits. In addition, tax benefits received in the last 5 years must be returned to the Revenue Department. In addition, the proceeds from the redemption of investment units must also be included in the calculation for income tax in the year in which the investment units are redeemed. Except in the case of the investor's death or disability, therefore, it will not be considered a violation of the investment conditions.
  
  
• Able to stop buying when buying and holding investment units continuously until 55 years of age. Have invested for at least 5 years (5 years counting will count only the year in which investment units were purchased and counting day by day from the date of the first purchase of investment units). And never suspend purchase for more than 1 year, so it will stop buying without breaking the conditions. In which investors can stop investing in RMF.

From the above conditions, this makes us have to be confident in buying RMF that we can buy it every year and hold it according to the law because the RMF that breaks the condition will be against the condition.

1. In case the investment is less than 5 years and there is a violation of the conditions for buying or selling prematurely

We must return all tax exemptions every year. The tax must be filed within March of the year following the year in which the conditions are violated. and bring profit from the redemption of investment units (if any)

2 . In the case of investing more than 5 years and there is a violation of the conditions for buying or selling prematurely

We are required to refund the exemption tax for the past 5 calendar years. The tax must be filed within March of the year following the year in which the conditions are violated. But the profit from the redemption of investment units will be exempt from personal income tax do not have to be considered for tax calculations as in the case of investments less than 5 years

However, in both cases of the tax refunds. If the form is filed later than March of the following year will have to pay an additional 1.5% per month. By counting the month of the additional money, it will start from April of the year following the year that violates the investment conditions onwards.

From the table, investors have breached the conditions in 2019. Therefore, a new return of the year 2015-2017 must be filed and pay a tax refund of 75,000 baht by March 31, 2020. If the amendment is filed within the specified time Investors will not have to pay an additional 1.5% per month. but if not submitted in time the investor will pay an additional 1.5% per month of the tax to be refunded. The additional fee will be charged from April 2020 onwards. until investors come to submit a revised form Therefore if you know that you have violated the conditions Immediately submit a new amendment to the income tax return within March of the year following the year that violates the conditions immediately.

When investors have submitted a new tax form and investors do not sell RMF funds and continue to hold investment units in RMF funds and continue to buy. Investors will also be able to count the period of purchase of RMF funds in the past before they have breached the consolidated conditions.

Question Buying RMF over the limit, what to do?

The recommendation for over-buying RMF is that it should hold until the conditions are met. Even if the purchase exceeds the right. This is because the Revenue Department will see that the sale of RMF before maturity is a sale of the RMF in the part that the discount has already been exercised which is considered a violation of investment conditions.

Question I want to sell RMF. How can I sell it?

Must sell according to the conditions of RMF only, therefore will not lose the right to reduce the tax. In addition, if we buy RMF from several asset management companies and do not buy continuously with any asset management company. to sell Must attach a purchase certificate of each asset management company. (all investment funds) to be attached to the redemption as well. To confirm that we have made the right terms of the purchase of RMF. So be sure to keep your investment documents intact, as some people may invest in RMF at an early age which you may have forgotten where you bought RMF from which asset management company.

How to trade RMF safely

• Tax planning from the beginning of the year. by assessing income and calculating the amount before investing This will let us know how much we have the right to buy RMF. (to prevent over-purchase)
  
• Determine the exact time of purchase of RMF, e.g. purchase at the beginning of the year. Some people buy it at the end of the year. Or maybe do a Dollar Cost Average (DCA) order. If you don't want to continue investing in RMF, you should place a minimum order at the beginning of the year. To avoid forgetting to buy RMF each year so that we will not suspend investment for more than 1 year.
  
• Keep a record of the purchase of RMF each year, and keep a certificate of purchase of investment units because it must be used as an attachment for future resale. It's also a good idea to keep proof of your tax return. Because if we break the conditions of the RMF, then we must return the tax saving to the IRS. We will calculate the money correctly. The best way is not to break the conditions.

Nipapun Poonsateansup, CFP®, ACC

Independent financial planner, author, speaker