Search
You're invited to try out the new version of Value Research Online. Click here to begin: https://beta.valueresearchonline.com

ELSS Blues

Avoid getting into the dividend reinvestment option trap when buying tax saving funds


  • TweetTweet
  • LinkedinLinkedin
  • FacebookShare
 

This old article may have references to outdated tax rules and laws. For up-to-date information on taxation of mutual funds, refer to https://www.valueresearchonline.com/tax/

I bought some ELSS schemes four years ago under the dividend reinvestment option. I find myself trapped this way because though the lock-in-period of original invested units is over, the dividend re-investment is like an endless cycle. How can I get out of this trap?
- Manish Gautam

Get updates from Value Research in your inbox

You are right with your observation of getting trapped with the dividend re-investment option in an ELSS. This is a problem that many face and there is a way to get out of it. Most fund houses allow you to switch from a dividend reinvestment option to a dividend option. For this, you need to write a letter, requesting for a change and/or fill up a “change in option” slip at the bottom of your account statement.



This old article may have references to outdated tax rules and laws. For up-to-date information on taxation of mutual funds, refer to https://www.valueresearchonline.com/tax/

comments powered by Disqus