Type of fund Time period Time period for Tax Rate on Short Tax Rate on Long Indexation

for categorization as Term Gain Term Gain allowed?

categorization Long Term Gain
as Short Term
Gain
Equity < 1 yr > 1 yr 15% + cess 10% + cess No
Debt <3 yr >3 yr As per slab rate of 20% + cess Yes
income
Hybrid Equity <1 yr > 1 yr 15% + cess 10% + cess
Hybrid Debt < 3 yr > 3 yr As per slab rate of 20% + cess
income
Relevant time period and tax rate for mutual funds

Classification as equity and debt fund

Type of fund Exposure of equity or debt Quantity of exposure

Equity funds Equity >65%
Debt funds Debt >65%
Hybrid equity funds Balanced Atleast 65% in equity and
remaining 35% in debt
Hybrid debt funds Balanced Atleast 65% in debt and
remaining 35% in equity

Relevant provision:

S. 111A: Tax on short-term capital gains in certain cases

S. 112: Tax on long-term capital gains

S. 112A: Tax on long-term capital gains in certain cases