Income Tax

This query is : Resolved

S.Jegadeesan (Querist)
Follow

27 July 2010 Sir,
I want to clarify one doubt relating to Income Tax. i.e. Whether any amount received out of amount invested in Liquid MF?
ex: Mr.X was invested on 28.05.2009 for Rs.500000 in LIC Liquid MF. He get the return(as Dividend) on various date like 30.06.2009, 15.08.2009, 30.10.2009 the sum of Rs. 1000,1500,1250 respectively.But He has invested those returns with the existing amount.So the investment will change.Finally he redeemed the whole/Part amount on 15.12.2009.How it will be taxable?
S.Jegadeesan.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
Follow

27 July 2010 In this case, income is declared by LIC periodically and not distributed to Mr. X. Therefore, section 10 (35) cannot be applied. Conversly, when the mutual fund is redeemed, capital gains tax attracts. Here it is a short term capital gain. Most of the mutual funds are redeeming the units by paying securities tranaction tax. So the short term capital gain arised thereon is taxable under section 111A of the Income tax Act,1961.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

bhavesh

Rajat Khandelwal

ashok jain

Devaraj B V

Konijarala prasad

Subscribe Now

Income Tax

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA