Tax Query: Computing Capital Gains Tax for MF Switches | usagoldmines.com

If I transfer my holdings in mutual funds from common plan to direct plan, would there be a component of capital features tax? Additional, if I transfer my holdings in mutual funds dividend choice to progress choice (to lower the incidence of tax on the dividends), would there be a capital achieve?

Murli Krishnamurthy

Motion of mutual fund holding from common plan to direct plan or from dividend choice to progress choice can be considered switch and therefore will entice capital features tax. The quantity of capital achieve/loss would must be decided contemplating kind of mutual fund, interval of holding and the distinction between sale worth and price of acquisition.

Fairness-oriented mutual funds held for a interval of 12 months or extra are categorised as long-term capital belongings and the transfer would end in long-term capital achieve/loss.

The author is Associate, Deloitte India  

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