InvestorQ : Does the benefit of indexation exist only for debt funds or for equity funds too?
Aditi Sharma made post

Does the benefit of indexation exist only for debt funds or for equity funds too?

Answer
image
Aashna Tripathi answered.
1 year ago
Follow
In fact, indexation is available for all long term gains, unless it is explicitly prohibited. There is an interesting thing to understand especially after the Union Budget 2018-19 which imposed a flat 10% on equity fund LTCG without the benefit of indexation. On the contrary, the LTCG on debt funds actually qualifies for indexation as explained above. In case of the equity fund, the benefit of indexation has not been given because there is already a flat exemption of Rs.1 lakh per financial year that is being offered on equity capital gains. That is the reason that the benefit of indexation has not been given in case of equity funds. Whether it actually makes the debt fund more attractive than and equity fund will depend also on the returns that these two categories of funds actually generate.
0 Views