Mutual Funds and Taxes

Different types of Mutual Funds attract different types of taxes. Here is all you would want to know about taxes applicable on Mutual Funds in India.

Taxation

Equity Funds

Liquid funds/Money Market Funds

Debt fund/liquid plus Funds

Short Term Capital Gain Tax

*16.995%

As per Income Tax Slab

As per Income Tax Slab

Long Term Capital Gain Tax

Nil

Less of 10% without indexation or 20% with indexation

Less of 10% without indexation or 20% with indexation

Dividend Distribution Tax

Nil

**28.325%

**14.163%
  • 80C benefits through ELSS: Under the current tax laws, you can get an annual income tax benefit of up to Rs. 1Lakh if you invest in Equity Linked Savings Schemes, ELSS. However, the minimum term for these schemes is 3 years and you cannot withdraw your money before that time

*There would be an additional surcharge of 10% of Short Term Capital Gain Tax if the individuals income is more than 10 lacs per annum. Further, the education cess of 3% shall be levied on all investors.

*Short Term Capital Gain Tax indicated above is inclusive of surcharge and education cess

**Dividend Distribution Taxes indicated above are inclusive of additional surcharge and cess.

PURPOSE & DISCLAIMER:

For the first time in my life i am doing something that i am good at, in public. This blog is purely a cut-copy-paste work baring a few personal views. Their is a glut of sites, blogs, pages and views about investment & savings. Still understanding and finding the right instrument is difficult. This is an endeavor to simplify the complicated financial jargons and products to make it understood by laymen.

As the URL name suggests, it’s for laymen by a layman of finance. This blog is strictly meant for me, my family and my friends and their few friends. The blog is not meant for experts & gurus of finance.

The author of this page is not a registered financial advisor. One should not construe anything written here to be financial advice. All information is a point of view and is for educational and informational use only.