I am a 62-year-old singleton retiree living on interest income from my FD. Every year TDS used to get deducted from this interest income and I used to submit 16A form given by the bank to claim refund. I have also invested in Equity Mutual Funds from these interest amounts in different AMCs in the past few years, and though I used to do switches, I have NOT done any profit booking as there is no need for me to do so.
Now my query is as per new ITR should I show the investments in these MFs too? Right now, the 26AS form only shows the TDS deducted.
Ans: You need to include short/long term capital gains/losses of mutual funds while filling your ITR, along with interest income.
Switches from one scheme to another will be treated as transfer under the IT act 1961 and will be subject to levy of capital gain tax, even if the gains are reinvested and not removed.
Whenever you switch or sell any mutual fund, you need show it as the sale value and compute the capital gain/loss by reducing the corresponding purchase value from the sale value.
The mutual fund capital gains will not show up in your 26AS statement, but still needs to be declared in your return.