Top News

• Important decision of SEBI for mutual funds
• Mutual fund units can be bought ‘tax free’
• This decision will give relief to the investors

Mutual Fund News: Investing in mutual funds is becoming popular these days. As a result, market regulator SEBI has taken a big step forward for investors. You can now easily gift your mutual fund units to loved ones. The change has made the process of transferring units significantly easier, allowing investors to enjoy tax benefits.

Market regulator SEBI has given significant relief to mutual fund investors. By amending the rules, SEBI has significantly simplified the process of gifting mutual fund units. Earlier, when investors wanted to transfer their units to someone else, they had to sell them first. They had to pay capital gains tax on these sales, which made the process difficult and expensive. Now, as per the new rules, direct transfer of units will be possible.

A major hurdle in the previous rules was that only units in demat form were easily transferable. However, the amendment will now apply to units in Statement of Account (SOA) form. This means that whether your units are in a demat account or in physical form, you will be able to visit them easily. This new rule will not only apply to gifting, but also to addition or removal of a joint holder’s name from inheritance and units, which will significantly reduce paperwork.

According to tax experts, this decision by SEBI provides a huge opportunity for tax planning. Suppose an investor has made substantial profits in a mutual fund. Now, they can gift these beneficial units to a family member, such as a parent or an adult child, whose income falls within the tax exemption limit.

International tax expert Mukesh Patel explained that if a person makes a profit of Rs 10 lakh and gifts it to their adult son or daughter who has no income, the entire profit can be tax-free. Because the recipient can avail the exemption limit under Section 87A. This reform is very important for Indian households who consider mutual funds as an important part of their wealth.

Experts say that simplifying the process of transferring mutual fund units is a long-standing demand. Due to the old rules, people were hesitant to gift units to their loved ones for fear of capital gains tax. This change will remove a major hurdle in important financial processes like gifting and inheritance. This move by SEBI will not only make mutual fund investment easier but also make family financial management easier.