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The
Provident Fund is an alternative saving scheme for retirement widely recognized
for more than 20 years, even prior to the enactment of the Provident Fund Act
B.E.2530. By law, the Ministry of Finance is in charge of and empowered to regulate
and supervise management of provident funds.
Initially,
the Fiscal Policy Office was appointed as fund registrar. Later on, amendments
were made in the Provident Fund Act B.E.2530 and the Securities and Exchange
Act B.E.2535, resulting in the stipulation that the Securities and Exchange
Commission, which at the time had already supervised and regulated mutual and
private funds, was assigned the role of provident fund registrar as of March
30, 2000.
Contribution and Benefit Payout
A
provident fund is established under a mutual agreement between the employer and
the employee with the purposes of offering fringe benefits to employees and
promoting saving for retirement. Voluntary
contributions range from 2% to 15% on the condition that employer contributions
must be equal to or higher than those of the employees. Termination of
memberships is decided by either one of the following three factors: (1)
retirement at 55 or older as stipulated in the governing rules, (2) resignation
or (3) death. Upon membership termination, members are entitled to a full
amount of benefit package. Portability among provident funds is allowed by law
and further amendments are in process to permit retirees to receive benefits in
the form of installments.
Tax Benefits
Details
at Tax Benefits.
Structure of a Provident Fund
Details
at Set Up a Provident Fund.
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