Choose DIVIDEND option of debt Mutual Funds and Save Tax

Download Tax Saving Mutual Fund Application Forms

Invest In Tax Saving Mutual Funds Online

Buy Gold Mutual Funds

Leave a missed Call on

94 8300 8300

 

 

OPT FOR DIVIDEND IN NON EQUITY FUNDS





The dividend distribution tax (DDT) is an invisible tax that many investors pay without even knowing. It is levied on dividends paid by mutual fund schemes other than equity funds and equity-oriented balanced schemes.For all other schemes, fund houses deduct a DDT of 28.33%.

 

Many investors, especially senior citizens who have opted for the dividend option of monthly income plans or debt funds, don't even know that they are paying DDT.They may not be in the tax net but pay a 28.33% tax on the dividend income from their mutual fund investments.

Instead of dividends, one should go for the growth option in non-equity funds. If you are looking for a regular monthly or quarterly income, start a systematic withdrawal plan (SWP). A predetermined amount is redeemed on the day of the month fixed by you. If you are looking for a lump sum, just redeem the amount when the need arises.

The growth option is more tax-efficient because unlike in the dividend option, the entire sum is not taxed. Only the capital gain is taxable. So, if you bought the fund when the NAV was `12 and sold it when it was `15, the tax will only be on `3 per unit. In the first three years, this `3 will be added to your income and taxed at normal rates. As we explained earlier, after three years, the gain is eligible for indexation. In recent years, high inflation has reduced the capital gains tax to almost nil.

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

Leave a missed Call on 94 8300 8300

Leave your comment with mail ID and we will answer them

OR

You can write back to us at

PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest Mutual Funds Online

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any Fund Application Forms

---------------------------------------------

Best Performing Mutual Funds

1. Largecap Funds Invest Online
1. DSP BlackRock Top 100 Fund
2. ICICI Prudential Focused Blue Chip Fund
3. Franklin India Bluechip
4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

1. ICICI Prudential Dynamic Plan
2. HDFC Top 200 Fund
3. UTI Dividend Yield Fund
4. Birla Sun Life Front Line Equity Fund
5. Franklin India Prima

C. Mid and SmallCap Funds Invest Online

1. Reliance Equity Opportunities Fund
2. DSP BlackRock Small & Midcap Fund
3. Sundaram Select Midcap
4. IDFC Premier Equity Fund
5. Birla Sun Life Dividend Yield Plus
6. SBI Emerging Businesses Fund
7. HDFC Mid-Cap Opportunities Fund
8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

1. DSP BlackRock MicroCap Fund
2. Franklin India Smaller Companies

E. Sector Funds Invest Online

1. Reliance Banking Fund
2. Reliance Banking Fund
3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

3. DSP BlackRock Tax Saver Fund
4. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

1. Relaince Gold Savings Fund
2. ICICI Prudential Regular Gold Savings Fund
3. HDFC Gold Fund
4. Birla Sun Life Gold

H. International funds Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF