When talking about assets that salarymen use as a source of savings or long-term investments which giving tax benefits as well, SSF and RMF mutual funds are the answers. Although many people are familiar with and invest in such funds, it may be a mistake that the tax that has already been reduced has to be returned and have to pay fines as prescribed by the Revenue Department.

Breach of investment conditions

Source: SSF & RMF, new twins used for tax deduction, The Stock Exchange of Thailand

Before making an investment decision, you should study the information thoroughly, for example, there are 5 types of tax benefits for retirement savings: SSF, RMF, pension insurance, national savings fund and the Provident Fund (or GPF and the Teacher Assistance Fund) with the same retirement savings limit which together must not exceed 500,000 baht.

Therefore, it should be calculated in advance, starting from evaluating the accumulated money into the Provident Fund (or GPF and the Teacher Welfare Fund) because this amount will be deducted from the salary every month. Then calculate how much you have left to buy SSF, RMF and pension life insurance.

Then, consider the terms of purchase and sale by purchasing SSF, investing up to 30% of taxable assessable income, but not more than 200,000 baht, and when combined with other retirement savings, must not exceed 500,000 baht in a tax year and does not need to continue investing every year whereas buying RMF requires continuous investment every year with the exception of not more than 1 year

For selling SSF, after purchasing, they must hold investment units for at least 10 years, counting on a day-to-day basis since the date of purchase by using the principle of separating into piles bought "first in, first out". For example, SSF funds bought on April 1, 2022 will be sold on April 2, 2032, SSF funds purchased on May 1, 2022 will be sold on May 2, 2032. etc.

For selling RMF, due to holding conditions, there are two parts: 5 years and 55 years. In the case of 5 years, it will be counted from the first RMF purchased. Not counted as a separate pile like SSF, counting on a day-to-day basis (Not a calendar year). In the case of 55 years of age, the full birthday must be counted which is misunderstood by counting as a calendar year that this year is considered 55 years old and can be sold before the birthday which is considered a violation of the conditions. The recommendation is that it should be sold past the date of birth. (Source: The Stock Exchange of Thailand)

In addition, in case that RMF cannot be bought continuously every year. For example, buying every other year, it may be understood that it can be sold. This is because it is understood that it has completed 5 years. If any year does not invest, it does not count. This may understand that the right to buy and then stop every other year and after 5 years can be sold, in which case this will count the investment years.

There are two methods for investing in RMF and SSF

1. Invest in lump sum (Lump Sum) by timing your investment as you assess as appropriate. The advantage is that if you enter at the right time, it will have a low cost. The disadvantage is that if you enter the wrong time, it can cause high costs. Therefore, it is suitable for those who have expertise in investing and have a large investment amount.

2. Investing with a weighted average (DCA) is a method to gradually invest regularly with the same amount over a specified period of time, such as every 1 ^st day of each month, 1,000 baht per month, etc. This is suitable for those who have a little investment and no more time to follow the information.

Before deciding to invest in SSF and RMF, you should examine yourself whether you are ready to invest. Because both of these funds are long-term investments. After investing, you have to hold investment units for many years. Importantly, there should not be a goal of investing for tax savings only. Because such funds are primarily designed to help with long-term savings.