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How are fund of funds (FoF) taxed?

Taxation for fund of funds (FoF) mutual funds is similar to that of debt mutual funds

What is the tax treatment for Quantum FoF and Kotak Asset Allocator FoF?
- Radhika Apshankar

Taxation for fund of funds (FoF) is similar to that of debt mutual funds. The redemption will qualify for long-term capital gains tax if your units are held for three years (36 months) or more. The long-term capital gains tax will be 20 per cent with the inflation indexation benefit.

If your investments are redeemed before three years (36 months), the short-term gains will be taxed as per your applicable Income Tax slab.

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