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Tax liability on redemption

If investments in debt mutual funds are sold before three years, short-term capital gains tax would be applicable

I had invested ₹13 lakhs in ICICI Prudential Regular Savings Fund in January 2014. The value of my investment is now ₹15.50 lakh. I want to redeem my investment. What will be the tax implication? I am in the 30 per cent tax bracket.
- Gajanan Joglekar

ICICI Prudential Regular Savings Fund is a debt mutual fund scheme. If investments in debt mutual funds are sold before three years, short-term capital gains tax would be applicable. Short-term capital gains are added to the income and taxed as per the Income Tax slab applicable to the investor. In your case, the returns would be added to your income and taxed at 30 per cent.

This article was originally published on December 22, 2015.

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