taxation w.r.to mutual funds?



Hello all,

Please clarify me on this:

1. If I buy mutual funds online and sell it within a year, does it attract capital gains tax ? i.e. is it like taxed like shares ?
2. If it’s a SIP mode, if I have to sell some within a year how it is taxed ?

Generally, can someone throw light on taxation w.r.to mutual funds

taxation w.r.to mutual funds?
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3 Replies to “taxation w.r.to mutual funds?”

  1. Answer to your first query is yes. you will have to pay shot term capital gains tax @ 10 percent rate. In case of SIP the units sold should have been held by you for over a year to avoid short term capital gains tax.


  2. Owning mutual fund shares is the same as stock in any single company. That being the case, yes, when you sell your shares, you will have a capital gain or loss, short-term if held less than a year, else long-term. Bear in mind as well, that the fund owns stock in many companies and throughout the year it will collect dividends and buy and sell. The fund then will have capital gains and losses, too. For this reason, the dividends you receive from the fund may come in a variety of forms, part qualifying dividends, part non-taxable dividends, perhaps, and capital gains.


  3. s
    hares & mutual funds have same taxation rules. In case of SIP, tax will be calculated on units based on first in first out basis.





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