Calculation of Taxable Income from sale of Mutual Funds (Equity Funds, Debt Funds and Hybrid Funds)

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This discussion clarifies how to calculate taxable income from selling various mutual fund types (equity, debt, hybrid) purchased over a year ago. It addresses whether indexation applies to the cost of acquisition for long-term capital gains and the necessity of paying advance tax. The user seeks guidance on the correct tax calculation method, applicable rates, and how to categorise this income for ITR filing.

Shivshankar Sharma

Shivshankar Sharma (Querist)
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30 July 2023 I have sold some different types of Mutual Fund units (Equity, Debt and Hybrid) in May 2023 for total sale. These were purchased at various points in time between 2018 and May 2022 (all were purchased more than 365 days ago prior to sale date).

Do I have to calculate Long Term Capital Gains using indexed cost of acquisition? Do I have to pay Advance Tax? How much tax and what's the calculation method and tax rate applicable? Which of the below 2 categories will be applicable while filing ITR online next year?

Equity share or unit of equity oriented Mutual Fund (MF) or unit of a business trust on which STT is paid under section 111A or 115AD(1)(b)(ii) proviso (for FII)
OR
Equity share in a company or unit of equity oriented fund or unit of a business trust on which STT is paid under section 112A

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)
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30 July 2023 Refer: https://groww.in/p/capital-gains-on-shares
&/or https://cleartax.in/s/taxation-on-income-earned-from-selling-shares
& https://learn.quicko.com/long-term-capital-gain-tax-equity-shares-section-112a

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)
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11 September 2024 Good Luck.

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