Stamp Duty

Stamp Duty



*Q: When u say I have to pay stamp duty, how will I pay?*
Ans: When u purchase a MF,  Stamp Duty will auto-deducted and paid to govt.  U don’t hv to do anything
For eg: if u invest 1 lac in any MF, the RTA (CAMs or Karvy) will deduct Rs. 5 (0.005%) as Stamp Duty from this

*Q: When I sell MFs, will stamp duty be applicable?*
Ans: No.  Only when u purchase MFs,

*Q: Is it applicable on my existing MFs also?*
Ans: No,it is only on fresh purchases from today. Existing units, no impact

*Q: On SIPs?*
Ans: Yes on SIPs too

*Q: On STPs?*
Ans: Yes

* Q: My SIP started 2 years back, so will I still pay Stamp Duty*
Ans: Yes, for all buy txns from today.  SIP is a purchase.
So for ur SIP instalments from today – irrespective if u started SIP before – Stamp Duty will be levied

*Q: So should I stop SIP?*
Ans: Not At All

*Q: For STP Explain in detail*
For eg: First say I put 1 lac in liquid fund and from their shift 10k every week to equity fund
Ans:First stamp duty will be charged on 1 lac
Then everytime 10k shifts to equity – since it is purchase of equity fund – u pay again stamp duty

*Q: For Switches?*
Ans: Same rule applies.  Everytime u switch, it is considered as a buy in the Switch-in scheme

*Q: Isn’t this double Stamp Duty?*
Ans: No.  Switch or STP is just a simple mechanism to help txn. It is a sell and buy

*Q: But is it only for Demat mutual Funds?*
Ans: Stamp Duty is for both kinds of units – Demat units also and normal account statement units also.

*Q: I buy DIRECT mutual funds?  For me will I pay stamp duty*
Ans: Yes, even if u buy DIRECT MFs

*Q: I buy on Fund House website, Will I pay Stamp Duty?*
Ans: Doesn’t matter where u buy from, Stamp Duty is applicable

*Q: But I don’t buy on Stock Exchange, will I still pay Stamp Duty*
Ans: YESSSS! Pls understand from whereever u buy MFs, u will pay it

*Q: So will Stamp Duty reduce my returns?*
Ans: U pay 0.005% as Stamp Duty.  That is a negligible amount. If u are a long term investor – there is no significant impact. Don’t worry

*Q: Which types of MFs – Debt also or only Equity MFs?*
Ans: On all kinds of MFs

*Q: So for liquid funds, overnight funds also ?*
Ans: Yes all kinds of MFs

*Q: For ETFs?*
Ans: Yes on ETFs also

*Q: FMPs, Close Ended Funds?*
Ans: Yes

*Q: Can u pls give example?*
Ans: Let’s say u invest, Rs. 1 lacs in a fund with NAV of Rs. 20
Earlier u would have got 5000 units (1 lac/20)
Now u will get 4999.750 units.  ( 1 lac – Rs. 5)/20
So it  marginal impact

*Q: If I invest 1 lac, I will now get units for 99,995.For purposes of tax calculation i.e.LTCG or STCG what will be my cost of acquistion ?*
Ans: No Change
Earlier: Cost 1 lac
Now: Cost 1 lac (Stamp Duty is considered and included as ur cost of acquisition)


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