Investors have to pay short-term and long-term capital gains on mutual fund investments.
When units are held over a period of one year, investors pay long-term capital gains tax on debt funds. In case of equity mutual funds, there is no long-term capital gains tax. This means if you hold units of equity fund for a period of more than 12 months, you can avoid the short-term capital gains tax.
For investments sold within one year, you pay 16.995% (15% + cess) short-term capital gains tax.
Short Term Capital Gains
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