Quick Summary
Overview Budget 2026 has removed the deduction for interest expenses incurred on loans taken to invest in listed equity shares or mutual funds. This is applicable from April 1, 2026 which means dividend and mutual fund income will be fully taxable without any interest offset, leading to a higher ta
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FAQ :
No, from April 1, 2026, interest paid on loans used to invest in mutual funds is not deductible when calculating capital gains.
Yes, you can claim interest expenses up to 20% of your dividend income as a deduction, but no other expenses like brokerage or advisory fees are permitted.
Yes, the restriction on interest deduction applies to all mutual fund units, regardless of whether they are equity or debt funds.
No, only a limited deduction for interest expense (up to 20% of dividend income) is allowed; other expenses such as advisory fees or brokerage are not deductible.
Yes, dividend income is now fully taxable in the hands of the investor at their applicable income tax slab rates.
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