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FoF Tax Treatment

For the purpose of computing tax, all Fund of Fund schemes are treated as debt funds…

What is the tax treatment on fund of fund schemes?
— Vikas Yadav

The tax treatment on a fund of fund (FoF) scheme is similar to those of debt funds, because all FoFs are treated as debt funds as far as tax treatment is concerned. The short-term capital gain on debt funds is added to the taxable income of an individual and is taxed as per the applicable tax slab. The long-term capital gain is taxed at 11.33 per cent without indexation or 22.66 per cent with indexation.

This article was originally published on September 02, 2011.

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