Best debt mutual funds in india

Tax Implications On Debt Mutual Funds In India

* Taxation on debt mutual funds depends on the holding period of the fund units. If an investor redeems the fund units before 3 years of investment, Short Term Capital Gains (STCG) Tax, as per the income tax slab of the investor is levied. * For instance, If an investor has made a capital gain of ₹50000 on investment in a debt mutual fund and withdraws the amount before 3 years of investment, Short Term Capital Gains Tax would be

levied, as per the income tax slab of the investor. ₹50,000 would be added to the taxable income of the investor and taxed accordingly. * If an investor withdraws the investment including capital gains post 3 years of investment, 20% Long Term Capital Gains Tax of 20% is levied, with the benefit of indexation. Indexation reduces the value of overall Long Term Capital gains to reflect the effect of inflation on your investment. * To calculate the final value

of capital gains post indexation, we use government’s Cost Inflation Index (CII) in the following formula: Indexed cost of Acquisition = Investment Amount * (CII of the year of withdrawal/ CII of the year of investment) Suppose the investment amount is ₹70,000 in the year 2016 and the withdrawal amount is ₹1 Lakh. The value of capital gains is ₹30,000 before indexation Indexed Cost of Acquistion= 70000* (280/254) = 77165.35 Note: CII in the year 2015 = 254 CII

in the year 2018 = 280 Final Value of Capital Gains= 100000- 77165.35 = 22834.65 Tax Payable = 20% of 22834.65 = 4566.93

Sep 17, 2020 IL&FS crisis that unfolded in September 2018 exposed the flaws of India's shallow credit markets. Two years hence, the COVID-19 pandemic has just exacerbated the credit risk. Corporates (across sectors) with strong financial muscle and balance sheet strength may manage to sail through rough waters, but the ones lacking adequate financial muscle and with highly leveraged balance sheets may find it difficult. The RBI's Financial Stability Report 2020 (released in July) cautioned that Gross Non-Performing Assets (GNPAs) of Banks may increase from 8.5% in March 2020 to 12.5% by March 2021 under the baseline scenario. And if the macroeconomic environment worsens further, the ratio may escalate to 14.7% (a 22-year high) under very severe stress. The stress test showed that under an extreme stress scenario, banks could fail to fulfil the minimum capital adequacy requirement

by March 2021. This is scary considering that large borrowers attribute 78% of GNPAs. The central bank has observed that the unprecedented COVID-19 pandemic and its pan-global impact is taking a toll on lives and livelihood. This pandemic has the potential to amplify financial vulnerabilities, including corporate and household debt burdens, in the case of severe economic contraction.

lekhaka-Vaishali Parnami By Vaishali Parnami | Updated: Tuesday, April 17, 2018, 9:07 [IST] Debt funds have become more popular these days, and now, people have started using these in place of fixed deposits. Usually, debt funds also have higher returns than fixed deposits. Here’s why debt mutual funds are better

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