From April 1, 2023, income from mutual funds investments with less than 35% exposure to equity, will be considered as a short term capital asset, irrespective of the holding period. Income from such funds will be treated as short-term capital gain and taxed at the investor’s slab rate.
Debt Mutual Funds are no longer tax efficient than Fixed Deposits
No Indexation benefit for debt mutual funds.
Investments in Market Linked Debentures (MLDs) will be considered as short term capital assets.
Capital gains from hybrid funds, gold funds (Gold ETFs), international funds, and funds of funds (FoFs) that do not invest more than 35% in equity will also be classified as short term capital assets.