Ltf - Tax Calculations

[perax]

hello all,

a quick query on LTF funds. Does anybody happens to know what I would be able to claim in a situation like the one described below? According to my bank (Citibank) I can deduct the gross amount, but it seems silly as I would be generating a significant tax deduction without actually spending any money. Seems a bit of a loophole.

I mean, I'm not complaining, but I'd not like to receive a nasty surprise come next April.

- Let's assume n 2004 I purchased 300,000 THB of an LTF fund. These quotes are now worth about 320,000 THB, and can be sold as per LTF regulations.

- Now suppose I sell these quotas today, then tomorrow I purchase 320,000 THB of the same (or other)LTF

- What can I use as tax deduction for 2009? The gross amount I purchased in 2009 (320,000), or the net LTF purchase (320,000-320,000), or something else?

Many thanks.

Edited August 7, 2009 by perax

[aurelius]

The year you purchase the fund is the year in which you are eligible for the tax deduction, and the tax deduction is based on the amount of the fund that you purchased - tax deduction amount is equivalent to the amount of tax you would have paid on the amount invested (tax is calculated in tiered rates). Certain caveats - investment amount cannot be more than 15% of income or max 500,000 bt whichever is lower.

Buying is totally unrelated to the funds you sell. Which means you can do this on a rolling basis. Getting tax benefits each year and selling 5 years later. ( 5 calendar periods).

But if you sell within the 5 year period there are some penalties.

[perax]

Thanks, Aurelius. I am aware of the tax implications, but wasn't sure how deductibles would be computed. Thanks again for clarifying.