SBI Conservative Hybrid Fund - Direct Plan

Suitability

"Conservative hybrid funds invest roughly a quarter of your money in equity shares and the rest in bonds. These funds are suitable for those who cannot withstand too much volatility in the value of their investments and are content with moderate returns which are slightly higher than returns from fixed income options.

They may also suit those looking for a regular income from their accumulation. The debt portion of these funds provides a moderate, but steady stream of income. The small equity allocation though adds a bit of volatility, but helps boost returns to keep up with the rate of inflation over the long term.

Invest only if your investment horizon is three years or more. To derive dependable income with some degree of inflation protection, invest your accumulated savings in these funds gradually over at least a few months, and then maintain a withdrawal rate in the range of 4-6 per cent of the value of your investment every year."

Taxation

Capital Gains Taxation

• If investment is made on or after 1 April 2023: Entire amount of gain is added to the investors' income and taxed according to the applicable slab rate.
• If investment is made before 1 April 2023:
  
• Sold within 3 years from the date of investment: Gains are added to the investors' income and taxed according to the applicable slab rate.
• Sold after 3 years from the date of investment: Gains are taxed at the rate of 20% after providing the benefit of inflation indexation.
• No tax is to be paid as long as you continue to hold the units.

Dividend Taxation

• Dividends are added to the income of the investors and taxed according to their respective tax slabs. Further, if an investor's dividend income exceeds Rs 5,000 in a financial year, the fund house also deducts a TDS of 10% before distributing the dividend.