NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Taxation
Ms. Rao sold units of an equity-oriented mutual fund scheme after holding them for 8 months, realising a gain of Rs 60,000. Assuming the current rates for equity-oriented funds, what is the tax on this gain, excluding surcharge and cess?
The gain is short-term because equity-oriented units were held for only 8 months, less than 12 months. Short-term gains are taxed at 20% under current rates, so the tax on Rs 60,000 is Rs 12,000 before surcharge and cess.
- ARs 12,000Correct
- BRs 7,500
- CRs 6,000
- DRs 18,000
Explanation
Equity-oriented units held up to 12 months give short-term capital gain, taxed at 20% under the current provisions. 20% of Rs 60,000 = Rs 12,000. Treating it as long-term at 12.5% would give Rs 7,500, which is wrong because the holding period is under 12 months.
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