NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Taxation
A resident individual redeems units of an equity-oriented mutual fund after holding them for 8 months, realising a gain of Rs 40,000. Applying the rate under current provisions for equity-oriented funds (short-term capital gains at 20%, ignoring surcharge and cess), the tax on this gain is:
The tax is Rs 8,000. Equity-oriented fund units held less than 12 months give short-term capital gains, taxed at 20% under current provisions. Applying 20% to the Rs 40,000 gain gives Rs 8,000, excluding surcharge and cess.
- ARs 4,000
- BRs 6,000
- CRs 8,000Correct
- DRs 12,000
Explanation
Holding period of 8 months is under 12 months, so the gain is short-term for an equity-oriented fund. Tax = 20% x 40,000 = Rs 8,000. Rs 4,000 uses 10%, Rs 6,000 uses 15% (old rate), and Rs 12,000 uses 30%.
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