Beruflich Dokumente
Kultur Dokumente
Fund
Managers
Investors
Invests in
Passed back to
Returns
Securities
Generate
Accessibility
Mutual funds units are easy to buy.
Liquidity
Mutual fund unit holders can convert their units into cash on any working day. They will
promptly receive the current value of their investment. Investors do not have to find a buyer;
the fund buys back (redeems) the units.
Diversification
By investing the pool of unit holders money across number of securities, a mutual fund
diversifies its holdings. A diversified portfolio reduces the investors risk. It would be difficult for
an average investor to buy varied securities to achieve the same level of diversification as is
available with investment in mutual fund.
Professional Management
Asset Management Company evaluates all the opportunities that arises in the market, carefully
examines them and then takes decision for investing the mutual funds money whereas it is not
an easy task for an individual and even for corporate company if investing is not their core
business.
B (%)
D = A*20%
(A/B)*C
750,000
5%
35,000
150,000
7,000
4.7%
1,500,000
10%
147,500
300,000
29,500
9.8%
2,500,000
14%
347,500
500,000
69,500
13.9%
4,000,000
18%
722,500
800,000
144,500
18.1%
6,000,000
22%
1,322,500 *1,200,000
220,417
22.0%
*Note: Maximum amount of investment that is avalable for tax credit is restricted to Rs. 1 million.
B (%)
750,000
1,400,000
1,500,000
1,800,000
2,500,000
3,000,000
3,500,000
4,000,000
7,000,000
2%
6%
6%
8%
11%
12%
14%
15%
20%
17,500
82,500
95,000
140,000
262,500
362,500
475,000
600,000
1,425,000
D = A*20%
(A/B)*C
150,000
280,000
300,000
360,000
500,000
600,000
700,000
800,000
*1,400,000
3,500
16,500
19,000
28,000
52,500
72,500
95,000
120,000
203,571
2.3%
5.9%
6.3%
7.8%
10.5%
12.1%
13.6%
15.0%
20.4%
*Note: Maximum amount of investment that is avalable for tax credit is restricted to Rs. 1 million.
For further details consult your Income Tax Advisor.
TAXATION
Rate of Withholding Tax on Dividend Income from Mutual Funds:
(i)
Stock Funds
Dividend received from stock fund if dividend receipts are less than
capital gain
(ii)
(iii)
25%
Tax Rate
12.5%
10%
0%