I am investing in open-end large & mid cap funds through SIPs for ten years. I want to know at the time of redemption after ten years, will the profits including my funds are taxed or not? -Pradeep Thirunagar
Currently, sale of units in equity-oriented mutual funds that are held for more than 12 months are classified as long term capital gains (LTCG). There is no tax on LTCG and you will not have to pay any tax on the gains from your investments. However, the proposed direct tax code that comes into effect from April 1, 2012 will tax gains made on sale or redemption of equity-oriented mutual funds even if the holding is above an year in these funds.