1. What is Mutual Fund Tax Calculator?

The Mutual Fund Tax Calculator helps investors calculate capital gains tax on mutual fund investments in India. It considers different tax rates for equity and debt funds based on holding period and applicable exemptions.

2. How Does the Calculator Work?

The calculator uses the following tax calculation formula:

Tax Rates (FY 2025-26):

• Equity Funds:
  • STCG: 20% (holding period < 1 year)
  • LTCG: 12.5% (holding period > 1 year, gains > ₹1.25 lakh)
• Debt Funds:
  • 12.5% (holding period > 2 years)
  • 20% (holding period ≤ 2 years)

3. Importance of Tax Calculation

Details: Accurate tax calculation helps in investment planning, understanding post-tax returns, and complying with Indian income tax regulations for mutual fund investments.

4. Using the Calculator

Tips: Enter capital gains amount in INR, holding period in years, and select the appropriate fund type (equity or debt). The calculator will automatically determine the applicable tax rate and calculate the tax liability.

5. Frequently Asked Questions (FAQ)

Q1: What is the difference between STCG and LTCG?
A: STCG (Short Term Capital Gains) applies to investments held for less than specified periods, while LTCG (Long Term Capital Gains) applies to longer holding periods with different tax rates and exemptions.

Q2: Is there any exemption limit for equity LTCG?
A: Yes, for equity mutual funds, LTCG up to ₹1.25 lakh per financial year is exempt from tax under Section 112A.

Q3: How is holding period calculated?
A: Holding period is calculated from the date of purchase to the date of redemption/sale. For SIPs, each installment has its own holding period.

Q4: Are debt fund tax rules different from equity funds?
A: Yes, debt funds have different holding period requirements (2+ years for LTCG) and different tax treatment compared to equity funds.

Q5: When should I pay this tax?
A: Capital gains tax on mutual funds is payable when filing your income tax return for the relevant financial year.