Taxation on non-equity investments

If I invest a lump-sum amount in a liquid fund/short-term debt fund and withdraw the money in three to six months, what will be the tax on short-term capital gains and how do I pay it? Will it be deducted during redemption? Also, if I invest in a long-term debt fund for more than three years, what will be the tax on long-term capital gains? What will be the taxable amount if I withdraw funds before three years?
- Subhro Dey

If you redeem liquid funds in three to six months, capital gains will be added to your income and taxed as per the applicable income-tax slab. You need to show the gains as income while filing ITR. The gains will not be taxed automatically.

The current taxation system on non-equity investments is given below:

This article was originally published on October 16, 2015.