Does Ltcg apply to ELSS?
ELSS investment qualifies for a tax deduction of a maximum of Rs 1.5 lakh per annum under Section 80C of the IT Act. However, investors incur LTCG tax on capital gains above Rs 1 lakh from ELSS only after the 3 year lock-in period.
Which is better ELSS or ULIP?
As shown above, ELSS offers a better package if you are investing for tax benefits and are comfortable with the market exposure of your capital. ULIPs, on the other hand, are primarily insurance options but not as efficient as an investment tool.
How Ltcg is calculate on mutual fund?
The profit of Rs 1,60,000 (200*1800 – 200*1000) is called long-term capital gains. You have to pay the long-term capital gains tax on the gains that are above Rs 1 lakh in a financial year. You have the LTCG tax on Rs 60,000. (Rs 1,60,000 – Rs 1,00,000) at 10\%.
How is LTCG applicable to ELSS funds?
LTCG shall be applicable to ELSS fund exactly like it is applicable to a equity fund. A person who sells shares after April 1, 2018 shall be required to pay a long-term capital gains tax at the rate of 10 percent on gains of more than ₹ 1 lakh.
Is long term capital gain tax applicable on ELSS?
Yes, long term capital gain (LTCG) tax is applicable on Equity Linked Savings Scheme (ELSS). Following are the tax implications associated with ELSS: A tax of 10\% is applicable on gains of more than Rs.1 lakh, held for a period of more than one year.
What is the tax on ELSS?
Taxation of insurance products falls under section 10 (10D) wherein income is free of tax at the hands of the investor at the time of withdrawal. ELSS, however, will now be taxable if the long-term capital gain is worth Rs 1 lakh.
What is the lock-in period for ELSS funds?
These funds come with a mandatory lock-in period of 3 years in order to get tax-free returns. However, after the re-introduction of LTCG tax in the budget, returns from the investments in ELSS funds would be taxed.