InvestorQ : How are gilt funds taxed?
Nishita Gala made post

How are gilt funds taxed?

Answer
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simran Kaur answered.
1 year ago


Gilt funds are funds that invest in government securities issued by the Reserve Bank of India (RBI). Given that they are issued by the central bank, they are safe from the risk of defaulting.

Capital gains from gilt fund are taxable. The rate of taxation is based on the investor’s holding period- for how long the individual was invested in the gilt fund.

A capital gain made during a period of less than three years is known as short-term capital gain (STCG). A capital gain made over a period of three years or more is known as long-term capital gains (LTCG).

Investors will receive the STCG from gilt funds and he/she should pay the income tax accordingly. LTCG tax, on the other hand, is fixed at 20% after indexation and 10% without the benefit of indexation.


user profile image
simran Kaur answered.
1 year ago


Gilt funds are funds that invest in government securities issued by the Reserve Bank of India (RBI). Given that they are issued by the central bank, they are safe from the risk of defaulting.

Capital gains from gilt fund are taxable. The rate of taxation is based on the investor’s holding period- for how long the individual was invested in the gilt fund.

A capital gain made during a period of less than three years is known as short-term capital gain (STCG). A capital gain made over a period of three years or more is known as long-term capital gains (LTCG).

Investors will receive the STCG from gilt funds and he/she should pay the income tax accordingly. LTCG tax, on the other hand, is fixed at 20% after indexation and 10% without the benefit of indexation.