Tax Liability on Dividend received from Mutual Fund

Share
Share This Thread
  1. Sanjay Ramdasi

    Sanjay Ramdasi New Member

    I have invested amount in LIC MF Liquid Fund (Daily Dividend-Reinvestment) option. Since this is liquid fund, I have a privilege to redeem the units as per my requirement at any time.
    Whether such redemption (out of principle amount or Dividend) is taxable or it is tax free.
    I have also invested in similar funds of SBI, HDFC and L & T Mutual Funds also.
     
  2. ZED

    ZED Well-Known Member

    Mutual funds are capital assets and withdrawal will attract capital gain tax.
    If they are equity oriented then period of holding should be more than 1 year to qualify them to be as long term capital asset, if they are other than equity (eg debt oriented) then the period of holding should be more than 3 years to qualify as a long term capital asset.
    [Long term capital gain from equity oriented fund would be exempt.]
    [If atleast 65% of the investment is in equity then the fund will be considered as an equity fund.]

    Dividends from Mutual fund is exempt in your hands u/s 10(35). This is so because tax is already deducted theron u/s 115R.
     
    Last edited: Jun 11, 2016
Draft saved Draft deleted
Loading...
Similar Threads Forum Date
Assets & Liability for ITR Income Tax Feb 16, 2018
Tax liability of Son posted abroad for employment Income Tax Nov 19, 2017
Asset & Liability Schedule Income Tax Jul 3, 2017
Tax liability Income Tax Jun 15, 2017
tax liability on interest in NRE fixed deposits, after the depositor become resident Income Tax Mar 31, 2017