I have completed a three-year SIP in DSP BlackRock Equity Fund. I have redeemed the entire amount at the end of the three years and received Rs 3.4 lakh on my investment of Rs 3.1 lakh. How much tax do I need to pay?
-Charan Singh
Gains on investments made for a period less than a year are short-term capital gains while those from longer periods are called long-term capital gains. In the case of equity and equity-oriented instruments, there is no long-term capital gains. However, when exiting in the short term, the short-term gains are taxed at 15 per cent.
As you had made SIP investments, the tax liability will be a mix of long-term and short-term gains. Gains from the SIPs that are less than one year old will be taxed at the 15 per cent rate, whereas gains from all the SIPs that are more than a year old will be tax free as they are long-term gains.
You need not calculate the gains manually, all you need is to ask DSPBlackRock for a capital gains statement. If you are registered your mail ID with DSP BlackRock, you can visit www.camsonline.com and opt for the consolidated realised gain statement. The statement is mailed to you for you to know your tax liability. Likewise, if you are maintaining your investment portfolio on our website www.valueresearchonline.com; the same calculation can be access to know your tax liability. However, only the official Cams statement is valid as statutory proof for tax purposes.
This article was originally published on March 24, 2014.
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