Government scraps long-term tax benefit for debt mutual funds investing less than 35% assets in equity
1 year, 8 months ago

Government scraps long-term tax benefit for debt mutual funds investing less than 35% assets in equity

The Hindu  

The government has scrapped the long-term capital gains treatment for income from debt mutual funds and other schemes that invest upto 35% in equity shares of domestic companies. “An arbitrage is being created right now where interest income from debt mutual funds is not distributed and converted into long term capital gains of 20%. “The amendment will treat gains from transfer of units of specified mutual funds as short term and tax them at slab rates,” said Tapati Ghose, partner at Deloitte India. More investors will opt to put their money into bank fixed deposits, equity mutual funds and hybrid funds that invest over 35% of their portfolios in equity and Sovereign Gold Bonds,” he noted.

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History of this topic

Investors shrugged off the hike in capital gains tax but still have a wish list
4 months, 3 weeks ago

Investors shrugged off the hike in capital gains tax but still have a wish list

Live Mint  

The Indian government’s decision to increase capital gains tax on listed stocks overnight by 2.5% for long-term gains and 5% for short-term gains was a brave one. The call, thus, had to be taken judiciously: will an overnight rate increase cause a crisis of confidence and lead to a pullback of global funds, or will the market still view the …

Budget 2024: What amendments are proposed in taxation of debt and bullion products- Let’s find out
4 months, 4 weeks ago

Budget 2024: What amendments are proposed in taxation of debt and bullion products- Let’s find out

Live Mint  

Budget 2024: The Capital gains sphere has become very complicated due to amendments made in isolation over the years in laws relating to holding periods and taxation of various asset classes. This created a third category of mutual fund scheme profit, which was treated as short-term capital gains and taxed at the slab rate applicable to the taxpayer. Removal of …

Budget 2024: Taxation related to capital gains in equity market transactions will affect you— THIS is how
4 months, 4 weeks ago

Budget 2024: Taxation related to capital gains in equity market transactions will affect you— THIS is how

Live Mint  

Proposed tax changes by Finance Minister include higher rates for capital gains on equity investments and increased STT on derivative transactions. Buyback shares to be treated as dividends, affecting cash flow of small shareholders Finance Minister Nirmala Sitharaman has proposed drastic changes in capital gains taxation. {{^adFree}} {{/adFree}} Increase in the tax rate and enhanced tax-free amount of long-term capital …

Mutual Fund SIP: How Will Budget 2024 Impact Tax Calculations on Capital Gains?
4 months, 4 weeks ago

Mutual Fund SIP: How Will Budget 2024 Impact Tax Calculations on Capital Gains?

News 18  

The Union Budget 2024-25 increased taxes on short-term capital gains and long-term capital gains for equity-oriented funds. The budget, announced on July 23, raises the STCG tax on equity mutual funds to 20% from the previous 15%, while the LTCG tax has increased to 12.5% from 10%. Equity mutual funds remain a popular choice for Indian investors seeking exposure to …

Union Budget 2024 India: Sensex, Nifty Take Big Hit As Govt Hikes Capital Gains Tax
5 months ago

Union Budget 2024 India: Sensex, Nifty Take Big Hit As Govt Hikes Capital Gains Tax

ABP News  

Union Budget 2024 India: The two key equity benchmarks, Sensex and Nifty, slumped lower during the Budget presentation as Indian investors will need to allocate a larger chunk of their earnings to taxes as the government raises both short- and long-term capital gains taxes. Finance Minister Nirmala Sitharaman, presenting her seventh Budget in Parliament on Tuesday, announced that the Long …

Enhancing Investor Returns: A Proposal to Revise Capital Gains Tax for Debt Mutual Funds
6 months, 1 week ago

Enhancing Investor Returns: A Proposal to Revise Capital Gains Tax for Debt Mutual Funds

Deccan Chronicle  

In recent years, the realm of investment has witnessed a surge in the popularity of debt mutual funds as a lucrative avenue for generating steady returns while managing risk. However, amidst the evolving landscape of taxation policies, there arises a pressing need to reevaluate the existing capital gains tax regime governing debt mutual funds. To address this, a proposed revision …

FM Sitharaman Denies Rumors of Sweeping Tax Changes
7 months, 2 weeks ago

FM Sitharaman Denies Rumors of Sweeping Tax Changes

Deccan Chronicle  

New Delhi: After BSE benchmark Sensex crashed 1,100 points following a report that the Income Tax department is planning some sweeping changes after Lok Sabha elections, Union finance minister Nirmala Sitharaman on Friday debunked rumours calling it pure speculation. Pure speculation," Sitharaman wrote on social media platform X, while reacting to a tweet made by a news channel claiming that …

CII Budget Wishlist: Revised Tax Returns Deadline Extension, Urges Capital Gains Overhaul
10 months, 4 weeks ago

CII Budget Wishlist: Revised Tax Returns Deadline Extension, Urges Capital Gains Overhaul

News 18  

Budget 2024 Expectations: The Confederation of Indian Industry has unveiled its set of recommendations for Budget 2024, focusing on simplifying personal taxation. The proposals include suggestions regarding capital gains tax and the timeframe for filing tax returns, among other key aspects. Share Buyback Taxation: Currently, under the open market route, the company incurs a buyback tax of 20 percent on …

Budget expectations from individual taxpayers, investors
11 months, 1 week ago

Budget expectations from individual taxpayers, investors

New Indian Express  

“The other demands are to make pensions tax-free in the hands of annuitants. Level-playing field between mutual funds and Ulips: At present, capital gains made from Unit-linked Insurance Plans are tax-free if the annual premium is less than R2.5 lakh. MF industry has been demanding a level playing field between Ulips and equity mutual funds as far as tax on …

Debt Mutual Funds Not Fixed Deposit, Has Underlying Risks. Hence, It Requires Tax Benefits Like Equity
1 year, 8 months ago

Debt Mutual Funds Not Fixed Deposit, Has Underlying Risks. Hence, It Requires Tax Benefits Like Equity

ABP News  

In a surprising move, debt mutual fund taxation laws were changed abruptly as the Narendra Modi government amended the Finance Bill 2023. Currently, any capital gain on redemption of a debt fund held for three years or longer is treated as long-term capital gain and is taxed at a flat 20 percent with indexation benefit. Any capital gain on redemption …

Debt Mutual Funds Taxation Rules Amended: How Will It Affect Your Investments?
1 year, 8 months ago

Debt Mutual Funds Taxation Rules Amended: How Will It Affect Your Investments?

Live Mint  

When passing the Budget Bill, 2023 in Lok Sabha earlier this week, the central government made amendments to the taxation of debt mutual funds. According to the amendments made in Budget 2023, investments made on or after April 1, 2023, will not be eligible for the indexation benefit for calculating long-term capital gains on debt mutual funds. Due to the …

Finance Bill proposes removal of tax advantage for debt mutual funds
1 year, 8 months ago

Finance Bill proposes removal of tax advantage for debt mutual funds

Live Mint  

Debt mutual funds, which so far enjoyed taxation benefit as long-term capital gains were taxed at 20% with indexation benefit, stand to lose this advantage from 1 April 2023. One such amendment is investments in mutual funds with up to 35% equity exposure to domestic companies, essentially debt funds, are liable to be taxed as per the investors’ income tax …

India Likely to Propose Removing Long-Term Capital Gains for Debt Mutual Funds: Report
1 year, 8 months ago

India Likely to Propose Removing Long-Term Capital Gains for Debt Mutual Funds: Report

News 18  

India may propose that investments in debt mutual funds be taxed as short-term capital gains, according to a source with knowledge of the matter, a move that could strip investors of the long-term tax benefits that made such investments popular. Currently, investors in debt funds pay income tax on capital gains according to the income tax slab for a holding …

Mutual funds: How long can you stay invested in a scheme?
1 year, 9 months ago

Mutual funds: How long can you stay invested in a scheme?

Live Mint  

While you shortlist an investment product, it is also very important to know the holding period or the ideal period to stay invested in the product. The Short Term Capital Gains tax is higher than the Long Term Capital Gains tax and so it would be wise to stay till the completion of the short term capital gains period. Up …

ICYMI: The history of capital gains tax in India
1 year, 11 months ago

ICYMI: The history of capital gains tax in India

Live Mint  

This article was first published on 19 January 2023, in the run up to the Union Budget for fiscal year 2024. From having a debate on whether capital gains tax would discourage investments to bringing in various provisions in the tax book on how to levy tax in diverse scenarios, India has come a long way. But Union budget 1956-57 …

How debt mutual funds are more tax efficient than bank fixed deposits (FDs)?
1 year, 11 months ago

How debt mutual funds are more tax efficient than bank fixed deposits (FDs)?

Live Mint  

For conservative investors, fixed deposits and debt mutual funds are among the most prominent debt investments. Based on an interview with CA Manish P Hingar, Founder at Fintoo, the spokesperson said “Both Bank Fixed Deposits and Debt mutual funds are suitable for investors with low to moderate risk profiles but a wise choice has to be made between the two …

’Wish uniform tax treatment of gains in mutual funds and ULIPs in Budget 2021’
3 years, 11 months ago

’Wish uniform tax treatment of gains in mutual funds and ULIPs in Budget 2021’

Live Mint  

The upcoming Union Budget is likely to be presented on February 1, 2021. 2) Uniform tax treatment in respect of investments in Mutual Funds Units and ULIPs of Life Insurance companies • Standardizing tax treatments for switching Investments under Mutual Fund schemes and ULIPs of Insurance companies. • Long Term Policy for Mutual Funds under SEBI classification Mutual Fund Linked …

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