Quick Summary
It has been noticed that a variety of hybrid securities that combine features of plain vanilla debt securities and exchange traded derivatives are being issued through private placements and listed on stock exchanges. It is seen that such securities differ from plain vanilla debt securities. 2. Market Linked Debentures are listed securities. They are currently being taxed as longterm capital gain at the rate of 10% without indexation. However, these securities are in the nature of derivatives
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1 Year PLAN
1999
(Excl. of GST ₹359)
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2 Years PLAN
3499
(Excl. of GST ₹629)
3 Months PLAN
999
(Excl. of GST ₹179)
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FAQ :
MLDs are listed securities that combine features of debt securities and exchange-traded derivatives. They have a principal component in the form of a debt security, and their returns are linked to market returns on other securities or indices.
Before Budget 2023-24, capital gains from MLDs were taxed as long-term capital gains at a rate of 10% without indexation.
Under the new rules, capital gains arising from the transfer, redemption, or maturity of MLDs will be treated as short-term capital gains and taxed at the applicable rates.
These amendments will take effect from April 1, 2024, and will apply to the assessment year 2024-25 and subsequent assessment years.
The change aims to treat the capital gains from MLDs, which are in the nature of derivatives, as short-term capital gains at applicable rates, aligning them with how similar financial products are taxed.
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