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IT on mutual fund dividend post retirement

Vinay (Manager) (31 Points)

18 June 2025

Dear Sirs,

i am going to retire in Jul and will be getting INR 6.5 L from MF dividend/ year and there is no other income . Will this amount be taxable?

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Rama chary Rachakonda (Master in Accounts & high court Advocate) (8545 Points)
Replied 18 June 2025

Taxability of Dividend Income The taxability of dividend income from mutual funds depends on the type of mutual fund and the dividend payout.

Dividend Income Taxation - *Tax-Free Dividend*: Dividends from equity-oriented mutual funds are generally tax-free in the hands of the recipient, as the dividend payout is made out of post-tax profits. -

*Taxable Dividend*: Dividends from debt-oriented or other types of mutual funds might be taxable, depending on the specific provisions of the Income-tax Act.

Your Situation Given your retirement and expected dividend income of ₹6.5 lakh per year from mutual funds, with no other income: -

*Tax-Free Dividend*: If the dividend income is from equity-oriented mutual funds, it is likely tax-free. -

*Taxable Income*: If the dividend income is from other types of mutual funds, it might be taxable. Important Considerations -

*Type of Mutual Fund*: Determine the type of mutual fund generating the dividend income to ascertain tax implications. -

*Tax Exemption*: Verify if any tax exemptions are applicable to your situation. Conclusion To determine the taxability of your dividend income: -

*Check Mutual Fund Type*: Confirm the type of mutual fund generating the dividend income. -

1 Like

Priya Gayakwad (4 Points)
Replied 18 June 2025

ihttps://giisraipur.in/ nicely explained and me as an insurance consultant in Raipur found all very useful;

SUSHANT BIDAYE (681 Points)
Replied 19 June 2025

I don't think dividend from equity mutual funds are exempt any more.

According to me all dividends are taxable now.

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