Debt mutual funds to be taxed as per slab from 1st April 2023!
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- Опубліковано 3 жов 2024
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Deviating away from the topic (as you mentioned - not productive), when governments' don't have a strong opposition, they treat everything like child's play.. and the common man has to suffer the consequences.
Promising something on the budget day and then fooling around while passing the finance bill is the worst form of cheating the retail investor.
not productive and it has nothing to do with a majority or opposition. These decisions are based on income streams for the govt and how their perceive tax loop holes.
Watched Pattu Sir's Debt fund videos and articles multiple times (10-15 times each) from past few months to understand Debt funds, asociated risks etc due to tax benefit over FDs...started investing in debt funds 2 months back and today goverment made this wierd anouncement :(
Why to take risks and invest in Debt funds now...FDs are much simple if tax treatment is same
Instead of gilt funds all new investments for debt component will go to FDs, which would increase the borrowing cost of government.
Unfortunate development. People are struggling to make ends meet due to inflation. This is another blow especially to pensioners who are solely dependent on their mutual fund investments (especially investments for the next 3 to 5 years expenses). Political leadership obviously are convinced that they can win the next elections irrespective of their actions.
The no of debt mutual funds investors are miniscule and will not decide the outcome of any elections.
very true
Apart from the serious nature of discussion, I found the cover pic/ thumb nail of the video aptly conveying the feelings of the investors😐
So NFOs in pipeline ' GLOBAL EQUITY INDEX FUND" investing 65 % in US total return index and 35 % in NIFTY 50 ?
Disadvantage for investors also for borrowers.
Taxation without allowing indexation is theft for it ignores the time value of money.
Conservative hybrid fund at the moment allows only upto 25% equity as per SEBI. Now I'm stuck with this fund that has the risk of both equity and debt markets along with the worst possible taxation scenario. I hope SEBI raises this to allow upto 36% investment in equity but I'm doubtful of that.
I'm anticipating more one way trip out of India by HNIs. Bond markets liquidity will shrink making it more difficult for businesses to raise debt. India is failing to provide stable regulatory framework that is required to win faith and draw investments.
So many rules mutual fund holders 😢😢
Seriously bad move
Yes ..really bad :(
Time to use only FD for debt portion
Asset allocation for goals less than 5 years has an impact. These have considerable or an overwhelming majority of debt funds. We learnt this from the master himself.Once the shock waves abate we will adapt( as usual)
Besides taxation advantage gone, are debt funds still better than FDs as we can enter exit anytime without penalty unlike FDs where money is locked in
Yes
Short, crisp and complete information. Thanks a lot..
Do you expect a shift to arbitrage funds or equity savings funds or conservative hybrid funds as a result of this change
I think AMFI has made / is in the process of making some representation to the Govt for this change
Other than introducing long term capital gains tax and tax on dividend 2-3 years back, this is another change, especially affecting the common investor.
There will be a shake up
Hi, is a Nifty 50+Nifty Next 50(80%), Nifty Midcap 150(20%) index fund a good enough portfolio for monthly SIPs? Or should I reduce it to 60% and bring in a 20% allocation for the Aggressive hybrid fund, since there will be no debt allocation?
If I have a mix of debt MFs (bought in 2022) that I regularly do STPs from. What should my strategy be now? Should I withdraw all of my investments in debt funds before 31 March or continue as per usual?
The Rich (HNIs>1M USD Investable wealth) will find ways. As such a Country which has No Wealth, Estate, Gift taxes and whose taxfree income can be 5 times the avg. Per Capita (12k pm) should relent to the Rich's demand for roll back. Cover pic says all. SEBI will approve new hybrid.
For an NRI it's better to invest in FD as there is no tax for NRE FD?
What happens to balanced advantage funds
Sir, why are hybrid funds are taxed like equity funds even though they have less than 65% equity exposure??
Govt has no logic, they just want to suck common man as much they can.
only aggressive hybrid funds and arbitrage fund are taxed like equity.
@@pattufreefincal except conservative Hybrid fund, every other hybrid catagory showing tax implications like equity fund. Wheather it is a equity savings or balanced advantage. I checked sir.
@@pratimbaidya1480 You are right. Now Equity Savings Fund becomes defacto debt for conservatives. Even better 10% tax, one year holding. First1Lakh free. Can pledge with banks. Great.
@@k2712m probably... But if someone don't need money under one year and looking for safe instruments with Better taxation, I think arbitrage fund is better with tax harvesting it will be better for long term.
Thank you Pattu Sir, I have a huge amount of my Debt portion in ICICI Gilt Fund, so should I stop my SIPs in this Fund from April 2023 or continue with it ?
What is your goal? Why did you buy it?
@@pattufreefincal It was done for my child's future education goal - 14 yrs from now (PPF + ICICI Gilt fund for the debt portion - 40 % )
rest 60 % is in Equity - UTI NIFTY 50 Index Fund
@@carpediem5666 You can stop or pause the SIP for now and wait and watch the developments in this space. And then take a call. It should be clear in a month or so
@@pattufreefincal sure, Thank you Sir for yor valuable inputs.
How do you get thumbnail picture?
istock
Is it still make sense to invest in debt funds and is it better to invest in aggressive hybrid funds ?
Completely different class of investments, satisfying different needs/goals and having different risk profiles.
I am missing clarity on International funds. Could you kindly make a detailed impact video on that?
I have been informed to pause International MF for now but I couldnt understand why?
I invest in S&P 500 through MO for retirement and my son's higher education fund. So, if I invest 10K a month, will I be taxed upfront 20% and rest gets invested or this 20% is taxed while I withdraw, say after 15 yrs?
Not upfront, only at the time of redemption. International equity funds are taxed like debt funds (< 35% domestic equity).
Talking about the changes that were introduced today -
For 15 yrs, you would have had long term capital gains tax which was 20% with indexation benefits. This is applicable for all your investments upto 31st March, which means no changes for the units you've already purchased even if you redeem several years from now.
Now, for all your further investments into MO S&P 500 fund (from 1st April onwards) you will be taxed as per your tax slab when you redeem these units several yrs down the line. So, essentially long term capital gains tax doesn't exist for such investments, everything will be taxed as per slab.
@@priyanksriv1 All the articles I read say, 20% of Tax collection at source (TCS) is applicable for International Funds. Which is upfront one right like TDS ?
@@prakashkumar90 That's only applicable if you're directly buying international stocks. Here you're not paying in INR but USD (for US). This falls under the Liberalized Remmitance Scheme and attracts the 20% TCS (which again, can be claimed while filing returns). This also applies if you invest in international ETFs like Vanguard directly using apps like Vested or IndMoney.
But since you're paying in INR to buy units of MO S&P 500 Index Fund, which is a domestic mutual fund, it doesn't fall under LRS and hence doesn't attract TCS. It's just treated like a domestic debt fund in terms of taxation.
Pls google this article "financial express article maximise your returns with overseas investments" (unable to post link in comments)