I tried to apply for an RMF (Retirement Mutual Fund) and LTF (Long-Term Equity Fund) with a bank in Thailand but they would not accept my application because of the FATCA requirements for US citizens.

Have any of you (Americans) recently opened either one of these, and if so, which bank?

Thank you.

Quite a few of the banks don't take US citizens as new clients for investment/ mutual fund accounts. You could add StanChart and TMB to that list.

If you do find one that will accept you, ensure you understand the tax implications from the US side. LTFs in particular are great products, and RMFs can be useful too from a Thai tax perspective. You may find that any advantages from the Thai side are eroded on the US side though.

Cheers

Fletch

Quite a few of the banks don't take US citizens as new clients for investment/ mutual fund accounts. You could add StanChart and TMB to that list.

If you do find one that will accept you, ensure you understand the tax implications from the US side. LTFs in particular are great products, and RMFs can be useful too from a Thai tax perspective. You may find that any advantages from the Thai side are eroded on the US side though.

Cheers

Fletch

Fletch,

Slightly off topic, but are there any changes to the LTF tax breaks for this year (and onwards). In the middle of last year I read that the holding period was likely to increase from 5 years to 7 years and then the tax breaks would expire altogether around 2020.

I am still in an LTF for this year, but after asking a few people at work and a bit of searching I cannot find anything definitive.

Thanks.

LTFs and RMFs are provided by the asset management arm of financial institutions such as banks and mutual fund companies. The only AM firm I know of that was taking new American applicants was Aberdeen, but that was a year or two ago and they may not be taking new applicants now. As FATCA gets digested (and as GATCA comes to be) eventually I expect more AMs to adjust to the new world and reopen to Americans overseas. But who knows how long that will take?

On the US tax issue, as Fletchsmile mentions, there are implications. You'll want to be sure that you get enough of a Thai tax break on your income to offset any potential US tax you might owe as well as the hassle of filling out Form 8621s. Everyone's situation is different - LTFs and RMFs can make a lot of sense for some US taxpayers, and not much for others. Google "RMF, LTF and PFIC" (Passive Foreign Investment Company) if you want to learn more about this.

If you decide RMFs and LTFs are a good deal in your situation, try Aberdeen and let us know if they take you, or if you find any AMs that take Americans.

Quite a few of the banks don't take US citizens as new clients for investment/ mutual fund accounts. You could add StanChart and TMB to that list.

If you do find one that will accept you, ensure you understand the tax implications from the US side. LTFs in particular are great products, and RMFs can be useful too from a Thai tax perspective. You may find that any advantages from the Thai side are eroded on the US side though.

Cheers

Fletch

Fletch,

Slightly off topic, but are there any changes to the LTF tax breaks for this year (and onwards). In the middle of last year I read that the holding period was likely to increase from 5 years to 7 years and then the tax breaks would expire altogether around 2020.

I am still in an LTF for this year, but after asking a few people at work and a bit of searching I cannot find anything definitive.

Thanks.

The product was originally supposed to end for new investments at end 2015. They've extended another 3 years, and adjusted the holding period to occupying 7 calendar years instead of 5 for new investments after 1 Jan 2016.

Tax breaks are largely the same. Back around July 2015 they amended the definition of "assessable income" a bit.

Your existing investments pre 1 Jan 2016 just continue under the old rules

Aberdeen and Bangkok Bank shouldn't be a problem if you have a work permit.