ULIP taxation: The free switching among funds may go away with new amendment

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  • By Taxmann
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  • Last Updated on 26 March, 2021

Mar 25, 2021

Naveen Wadhwa (DGM | Taxmann.com), said:

“…Profits and gains arising from the Units of Equity Oriented Funds shall be taxable under Section 112A. Such gains in excess of Rs 100,000 shall be taxable at the rate of 10% without indexation…”

“…However, in case the ULIP fund does not meet the equity MF criteria, the taxation will work like debt mutual funds. “Profits and gains from the units of non-equity funds (debt-based, money market, etc.) shall be taxable under Section 112 at the rate of 20% with indexation,” explained Wadhwa. As the non-equity investment portion will be considered as debt investment, the minimum holding period will have to 3 years in order for it to eligible for LTCG tax….”

Read the Full Article Here: ULIP taxation: The free switching among funds may go away with new amendment.

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