Tax Reckoner 2013-2014
 
Snapshot of Tax rates specific to Mutual Funds
 
The rates are applicable for the financial year 2013-14 and are subject to enactment of the Finance Bill, 2013.
 
  Effective : 1st. April 2013.
 
 
1. Income Tax Rates
For Individuals, Hindu Undivided Family, Association of Persons, Body of
Individuals and Artificial juridical persons
 
Total Income Tax Rates
Up to Rs. 2,00,000 (a)(b) NIL
Rs. 2,00,001 to Rs. 5,00,000 10%
Rs. 5,00,001 to Rs. 10,00,000 20%
Rs. 10,00,001 and above 30%
   
  (a) In the case of a resident individual of the age of 60 years or above but below 80 years, the basic exemption limit is Rs. 2,50,000.
(b) In case of a resident individual of age of 80 years or above, the basic exemption limit is Rs. 5,00,000.
(c) Surcharge @ 10% is applicable on income exceeding Rs. 1 crore; Marginal relief for such person is available.
(d) Education cess is applicable @ 3% on income tax plus surcharge.
(e) Finance Bill 2013 proposes a rebate of Rs 2,000 for individual having total income upto Rs 5 Lacs.
   
2. Securities Transaction Tax (STT)
STT is levied on the value of taxable securities transactions as under.
 
Transaction Rates Payable By
Purchase/ Sale of equity shares 0.1% Purchaser/Seller
Purchase of units of equity oriented mutual fund (delivery based) @ Nil Purchaser
Sale of , units of equity oriented mutual fund (delivery based) @ 0.001% Seller
Sale of equity shares, units of equity oriented mutual fund (non-delivery based) 0.025% Seller
Sale of a option in securities 0.017% Seller
Sale of an option in securities, where option is exercised 0.125% Purchaser
Sale of a futures in securities @ 0.010% Seller
Sale of unit of an equity oriented fund to the Mutual Fund @ 0.001% Seller
  @ effective 1 June 2013
   
3. Special rates for non-residents
(1) The following incomes in the case of non-resident are taxed at special rates on gross basis:
 
Transation Rate (a)
Dividend (b) 20%
Interest received on loans given in foreign currency to Indian concern or Government of India 20%
Income received in respect of units purchased in foreign currency of specifies Mutual Funds / UTI 20%
Royalty or fees for technical services 25%
Interest income from a notified infrastructure debt fund 5%
Interest on FCCB, FCEB / Dividend on GDRs(b) 10%
   
  (a) These rates will further increase by applicable surcharge and education cess.
(b) Other than dividends on which DDT has been paid.
(c) In case the non-resident has a Permanent Establishment (PE) in India and the royalty/ fees for technical services paid is effectively connected with such, the same could be taxed at 40% (plus applicable surcharge and education cess) on net basis.
   
  (2) Tax on non-resident sportsmen or sports association on specified income @ 10% plus applicable surcharge and education cess.
   
 
4. Capital Gains
 
Transaction Short-term capital gains tax rates (a) Long-term capital gains tax rates (a)
Sale transactions of equity shares / unit of an equity oriented fund which attract STT 15% NIL
Sale transaction other than mentioned above:
Individuals (resident and non-residents) Progressive slab rates 20% with
indexation; 10%
without indexation
(for units/ zero
coupon bonds)
Partnership (resident and non-residents) 30%
Resident Companies 30%
Overseas financial organisations specified in section 115AB 40% (corporate) 30% (non corporate) 10%
FIIs 30% 10%
Other Foreign companies 40% 20% / 10%
Local authority 30% 10% without
indexation (for units/
zero coupon bonds)
/ 20% (for others)
Co-operative society rates Progressive slab
  (a) These rates will further increase by applicable surcharge & education cess.
   
  Personal Tax Scenarios (Amount in Rupees)
Individual Income Level
5,00,000 5,000,000 11,000,000
Tax in FY 2012-13 30,900 1,369,900 3,223,900
Tax in FY 2013-14 28,900 1,369,900 3,546,290
Effective Tax Savings 2,000 Nil NA
Effective Tax Savings 6.47% 0% NA
Additional Tax Burden NA Nil 322,390
Additional Tax Burden NA 0% 10%
   
Resident senior citizen (age of 60 years but below 80 years) Income Level
5,00,000 50,00,000 11,000,000
Tax in FY 2012-13 25,750 1,364,750 3,218,750
Tax in FY 2013-14 23,750 1,364,750 3,540,625
Effective Tax Savings 2,000 Nil NA
Effective Tax Savings 7.77% 0% NA
Additional Tax Burden NA Nil 321,875
Additional Tax Burden NA 0% 10%
   
 
Resident very senior citizen at the age of 80 years and above Income Level
5,00,000 5,000,000 11,000,000
Tax in FY 2012-13 Nil 1,339,000 3,193,000
Tax in FY 2013-14 Nil 1,339,000 3,512,300
Effective Tax Savings NA Nil NA
Effective Tax Savings NA 0% NA
Additional Tax Burden NA Nil 319,300
Additional Tax Burden NA 0% 10%
Marginal relief as applicable would be available
 
Tax Implications on Dividend received by Unitholders
  Individual HUF Domestic Company NRI
Dividend
Equity oriented Schemes Nil Nil Nil
Debt oriented Schemes Nil Nil Nil
 
Tax on Distributed income (payable by the scheme) rates
Equity oriented Schemes** Nil Nil Nil
money market and Liquid schemes 25% + 10% Surcharge** + 3% Cess=28.325 % 30% + 10% Surcharge** + 3% Cess=33.99 % 25% + 10% Surcharge** + 3% Cess=28.325 %
Debt schemes (other than infrastructure debt fund) 25% + 10% Surcharge** + 3% Cess=28.325 % 30% + 10% Surcharge** + 3% Cess=33.99 % 25% + 10% Surcharge** + 3% Cess=28.325 %
Infrastructure Debt Fund 25% + 10% Surcharge** + 3% Cess=28.325 % 30% + 10% Surcharge** + 3% Cess=33.99 % 25% + 10% Surcharge** + 3% Cess=28.325 %
 
* Security transaction tax (STT) will be deducted on equity fundsat the time of redemption / swich to the other schemes / sale of units.
** Effective from 1 june 2013
   
Capital Gain Taxation  
  Individual / HUF $ Domestic Company @ NRI $ / #
Long Term Capital Gain (Units held for more than 12 months)
Equity oriented Schemes Nil Nil Nil
Other than equity oriented Schemes 10% without indexation or 20% with indexation whichever is lower 10% without indexation or 20% with indexation whichever is lower 10% without indexation or 20% with indexation whichever is lower
Without Indexation =10% =10% =10%
With Indexation =20% =20% =20%
 
Short Term Capital Gain (units held for 12 months or less)
Equity oriented Schemes 15% 15% 10%
Other than equity oriented Schemes 30% 30% 30%^
 
Tax Deducted at Source (Applicable only to NRI Investors)
  Short term capital gains Long term capital gains
Equity oriented Schemes 15% Nil
Other than equity oriented Schemes 30% 20% # #
 
$ - Surcharge at the rate of 10% is proposed to be levied in case of individual/ HUF unit holders where their income exceeds Rs 1 crore.
@ - Surcharge at the rate of @ 5% is proposed to be levied for domestic corporate unit holders where the income exceeds Rs 1 crore but less than 10 crores and at the rate of 10%,where income exceeds 10 crores
# - Short term/ long term capital gain tax will be deducted at the time of redemption of units in case of NRI investors only.
## - After providing for indexation
^ Assuming the investor falls into highest tax bracket.
Education Cess @3% will continue to apply on tax plus surcharge
 
Dividend Stripping: The loss due to sale of units in the schemes (where dividend is tax free) will not be available for setoff to the extent of the tax free dividend declared; if units are:
(A) bought within three months prior to the record date fixed for dividend declaration; and
(B) sold within nine months after the record date fixed for dividend declaration.

Bonus Stripping: The loss due to sale of original units in the schemes, where bonus units are issued, will not be available for set off; if original units are:
(A) bought within three months prior to the record date fixed for allotment of bonus units; and
(B) sold within nine months after the record date fixed for allotment of bonus units. However, the amount of loss so ignored shall be deemed to be the cost of purchase or acquisition of such unsold bonus units.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
 
Disclaimer : The information set out above is included for general information purposes only and does not constitute legal or tax advice. In view of the individual nature of the tax consequences, each investor is advised to consult his or her own tax consultant with respect to specific tax implications arising out of their participation in the Scheme. Income Tax benefits to the mutual fund & to the unit holder is in accordancewith the prevailing tax laws as certified by the mutual funds tax consultant. Any action taken by you on the basis of the information contained herein is your responsibility alone. Tata Mutual Fund will not be liable in any manner for the consequences of such action taken by you. The information contained herein is not intended as an offer or solicitation for the purchase and sales of any schemes of Tata Mutual Fund.