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Formula sheet/NISM Series V-A: Mutual Fund Distributors/Taxation
[ TAXATION ]

Stamp Duty, TDS on IDCW & Bonus Stripping Rule

Mutual Fund Issue Stamp Duty=0.005%of Inflow Amount∣Transfer Stamp Duty=0.015%\text{Mutual Fund Issue Stamp Duty} = 0.005\% \text{of Inflow Amount}\quad\Big|\quad \text{Transfer Stamp Duty} = 0.015\%
TDS on IDCW(Dividends):10%deducted on annual dividend payout exceeding Rs5,000per folio\text{TDS on IDCW} (Dividends): 10\% \text{deducted on annual dividend payout exceeding Rs} 5,000 \text{per folio}
Bonus Stripping(Sec94(8)):If units purchased within3months prior to bonus record date and sold within9months after record date,capital loss is disallowed and added to bonus unit cost.\text{Bonus Stripping} (Sec 94(8)): \text{If units purchased within} 3 \text{months prior to bonus record date and sold within} 9 \text{months after record date}, \text{capital loss is disallowed and added to bonus unit cost}.
Variables

Deduction u/s 80C up to Rs 1.5 Lakh is available on ELSS Tax Saver funds (3-year statutory lock-in) under the Old Tax Regime.

Exam note

Tax on IDCW (Dividends) in the hands of resident investors is taxed at their personal applicable marginal slab rate.

Worked examples
Equity MF Capital Gains Tax with Rs 1.25 Lakh Exemption

A resident individual sells 10,000 units of an equity-oriented mutual fund on 15th August 2024 at Rs 55.00 per unit (STT paid). The units were purchased on 1st June 2023 at Rs 35.00 per unit. The investor had no other capital gains during FY2024-25. Calculate the Long-Term Capital Gain and the tax payable under Section 112A.

Bonus Stripping Loss Disallowance under Section 94(8)

An investor buys 1,000 units of an equity fund at Rs 60.00 per unit on 1st July 2024. The scheme announces a 1:1 bonus with record date 1st September 2024 (1,000 bonus units allotted free). Post-bonus NAV drops to Rs 30.00. The investor sells the original 1,000 units at Rs 30.00 on 15th December 2024 while holding the bonus units. Calculate the allowable capital loss and the adjusted cost of the bonus units.