I redeemed by Equity MF's in this FY (2022-2023) after helding more than 5 years. Capital Gains is around Rs 1,50,000. My consfusion is whether entire 150,000 would be taxable under LTCG or Rs. 50,000 be taxable as there is exemption upto Rs. 1 Lakh ? Please give proper clarification.
Ans: As per the current tax laws, long-term capital gains (LTCG) from equity mutual funds are taxable at a flat rate of 10% on gains above Rs. 1 lakh in a financial year. So, in your case, since your LTCG is Rs. 1,50,000, the taxable amount would be Rs. 50,000 (i.e., Rs. 1,50,000 - Rs. 1,00,000).
Please note that the exemption of Rs. 1 lakh applies to the total LTCG from all equity-oriented mutual funds that you have sold during a financial year. So, if you have already sold equity mutual funds earlier in this financial year and claimed the exemption up to Rs. 1 lakh, then the remaining gains would be taxed at 10% above the exemption limit.
It is important to note that the tax laws can change in the future, and you should always consult a tax expert or refer to the latest tax laws before making any tax-related decisions.