In case you had invested in the 6 funds of Franklin Templeton, you would have received some money from the side pocket of Vodafone bonds. How do you treat this in your tax? Here is what Akhilesh of Mutual Fund Guide, a brilliant Chartered accountant has to say…

The amount received by them is nothing by the redemption of units. FT shows the units redeemed on 15th June 2020. The cost of acquisition is NIL. Thus, the whole receipt is capital gains in this FY.

Next Question : This capital gain is ST or LT? Depends on when the original units were bought. The length of holding of segregated units won’t be from the date of creation, but from the date of purchase of original units. Accordingly, pay include this income to pay advance tax.

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