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Dhirendra Kumar talks about mutual fund taxation after the reimposition of long-term capital gains tax
09-Mar-2018 •Research Desk
Are equity mutual fund managers liable to pay long term capital gains tax?
- Vasudev
Transcript: Mutual fund managers are not liable to pay capital gains tax when they sell stocks in the portfolio. But when a mutual fund receives dividends, dividend distribution tax is already deducted by the company. You are liable to pay capital gains tax on the basis of the time period for which you were invested. Equity fund has been defined as a fund where at least two-third of the money (65 per cent) is invested in equity. So, if you sell your units in an equity fund in less than a year, the gains will be considered as short term capital gains and will be taxed at 15 per cent. Earlier, the gains were tax-free if the holding period was more than one year. But now it is taxed at 10 per cent on the gains exceeding Rs 1 lakh.
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