NAV & Dividend
NAV & Dividend
What you need to know
What you need to know
Investing principles for the long term
1. What is a mutual fund?
A mutual fund is a collective investment vehicle. It is a pool of investors’ money invested according to pre-specified investment objectives. All those who invest into the collective investment are eligible to receive the gains in proportion to their contribution. Since there is mutuality in the contribution and the benefit, hence the name ‘mutual’ fund.
2. Who is a unit holder?
The investment in a mutual fund is represented to the investor in units. Just as investors in equity jointly hold shares of a company, mutual fund investors jointly hold units of the fund. A mutual fund investor is called a unit holder just as an investor in equity shares is called a share holder.
3. How is a mutual fund set up?
Mutual funds in India have a three-tier structure that consists a sponsor, a trust and an Asset Management Company (AMC). (represent in diagram) For IDBI Mutual Fund IDBI Bank Limited – Sponsor IDBI MF Trustee Company Limited – Trust IDBI Asset Management Limited – AMC
4. Who is a sponsor?
The sponsor is the promoter of the mutual fund, who sets up the trust and the AMC, appoints the board of trustees and the board of directors of the AMC. The sponsor seeks regulatory approval for the mutual fund. IDBI Bank Limited is the sponsor for IDBI Mutual Fund.
5. How is the sponsor appointed?
SEBI has laid down the eligibility criteria for a sponsor. A sponsor should:
have at least five years’ experience in the financial services industry.
have a good financial track record of at least three years prior to registration of the fund. (Positive net worth is essential).
contribute at least 40% of the capital of the asset management company (AMC).
6. How is the mutual fund set up?
The sponsor creates the mutual fund itself as a trust. Investors in the mutual fund are the beneficiaries of the trust.
7. Who are the trustees?
Trustees are appointed by the sponsor, with SEBI approval, to act on behalf of the investors. The trustee company supervises the management of the mutual fund, safeguarding the interest of the unit holders. IDBI MF Trustee Company Limited is the trustee for IDBI Mutual Fund.
8. Who sets up the Asset Management Company?
The AMC is appointed by the trustees of the fund, in consultation with the sponsor and with the approval of SEBI. An AMC is required to maintain a net worth of at least Rs.50 crore at all times. IDBI Asset Management Limited is the AMC for IDBI Mutual Funds.
9. What is the role of the Asset Management Company?
The Asset Management Company’s primary role is to manage the contributions from investors and take investment decisions. Investments are managed on a daily basis by a team of professional fund managers.
10. How does a mutual fund operate?
Mutual funds formulate different schemes based on different asset classes catering to different types of investors. Each scheme is managed by a professionally qualified fund manager. As the unit holders invest money into a particular scheme, the fund manager buys shares, bonds and other securities (depending on the asset class that the fund invests in) and creates a portfolio of such securities. The unit holders are allotted units based on the NAV of the fund. The rise or fall in the NAV determines the returns to investor.
11. What are mutual fund schemes?
Mutual funds create a range of products, called as mutual fund schemes, to cater to varying needs and preferences of investors. Each of these schemes has a separate portfolio based on its investment objective.
12. What is a portfolio?
A portfolio is a collection of securities. These securities can be equity shares, bonds, debentures, deposits, money market instruments, derivatives and the like.
13. What kind of securities do mutual funds invest in?
Mutual funds can invest only in marketable securities, or securities that can be traded in a market and therefore have a market price.
14. What are the factors that influence the performance of mutual funds?
The performance of mutual funds is influenced by the performance of the underlying securities as well as the market performance as a whole. Equity Funds are influenced by the the performance of the stock market. Debt funds are influenced by movement of interest rates and changes in the credit quality of the bonds/debentures.
15. What is NAV?
NAV is the net asset value of a mutual fund. It is basically the price of one unit of a mutual fund. Mutual fund units are bought and sold on the basis of a fund's net asset value.
16. Why does the NAV of a mutual fund change everyday?
The value of the investment portfolio of a mutual fund changes every time there is a change in market price of the securities it holds. Since NAV reflects the current value of each unit, it is computed everyday.
17. How is NAV calculated?
NAV can be calculated as: Assets of the fund – liabilities of the fund / Number of outstanding units for that fund. Example: Rs.25 crore is the market value of a mutual fund’s portfolio and its current liabilities are Rs 1crore. The number of units held in the fund are 2 crore. The NAV will be computed as: (25-1)/2 = 12. Thus, the NAV will be Rs.12
18. How often is the NAV declared?
Mutual fund companies declare NAV on a daily basis in case of an open ended mutual fund and on a weekly basis in case of close ended mutual funds.
19. By what time is the NAV published?
NAV is published for all funds (except Fund of Funds) by 9pm every working day. A fund of funds (FOF) can publish its NAV only after the underlying funds have published their NAV.
20. What is sale price for a mutual fund?
The sale price of a mutual fund is the price at which investors invest into a mutual fund.
21. What is the repurchase/redemption price for a mutual fund?
Repurchase or redemption price is the price that you receive on selling each unit of your mutual fund investment.
22. How can I earn returns from mutual funds?
Through Dividends declared
By selling the mutual fund units at a price higher than that at which you bought them
23. How can I monitor or track the NAV of mutual funds I have invested in?
Investor can track the performance of mutual funds through the NAV of the scheme. The NAV of mutual fund schemes, along with the sale and repurchase price is published every business day at https://www.idbimutual.co.in/nav_equity.asp and on the website of Amfi (https://www.amfiindia.com/net-asset-value) . Therefore, fund of funds have to publish their NAV by 10am of the next day following the business day. NAVs are also be published in at least two daily newspapers having nationwide circulation.
24. What are the different types of mutual funds?
Funds can be classified depending on investment category (also called asset class) they focus on. For example, equity funds, debt funds, hybrid funds, money market funds, commodity funds, real estate funds and gold funds.
The objective of funds can be used to classify them. For example, growth funds and income funds, tax saving funds, children’s plans, monthly income plan (MIP).
Funds are also classified on the basis of their structure – open-ended and close-ended funds.
Funds are classified as active and passive, dynamic and asset allocation, diversified and concentrated, based on the how the portfolio is created and the investment strategy adopted by the fund manager.
25. What are open-ended funds?
An open-ended fund does not have a pre decided maturity date. It is open to accept purchases and redemptions at any time. An open-ended fund offers units to investors for the first time during the new fund offer (NFO). You can buy (purchase) and sell (redeem) units of an open- ended fund, at the mutual fund offices or their investor service centers (ISCs) on a continuous basis.
26. What are close-ended funds?
Close-ended funds operate for a specific period. On the specified maturity date, all units are redeemed and the scheme comes to a close. Closed-end funds are offered in an NFO but are closed for further purchases after the NFO. The units of a closed-end fund are compulsorily listed on a stock exchange to provide liquidity.
27. What are debt or fixed income funds?
Debt funds invest in predominantly fixed income securities, such as bonds, debentures, deposits. Debt securities have a fixed maturity date and pay a specific rate of interest. There are different types of debt funds that invest in various market segments.
28. What are money market funds or liquid funds?
Money market funds or liquid funds invest in debt securities with less than 91 days to maturity such as treasury bills, commercial papers and certificates of deposits.
29. What are gilt funds?
Gilt funds invest in government securities. These funds do not have the risk of default since the issuer of the instruments is the government. Gilt funds, however, may have a high degree of interest rate risk, depending on their maturity.
30. What are income funds?
Income funds invest in debt securities issued by companies, banks, financial institutions and government. The risk of default is also higher in these funds as compared to gilt funds, since they also invest in securities issued by non-government agencies that carry credit risk.
31. What are equity funds?
Equity funds invest in equity shares issued by companies. The risk of such funds is higher than that of debt funds, since equity offers a lower income (dividend) and can be volatile (changes in market value). However, equity funds offer long-term capital appreciation. The risk level of equity funds can differ depending upon the investment strategies adopted by the fund manager.
32. What are index funds?
The objective is to replicate the portfolio of a particular index such as the BSE Sensitive index, S&P NSE 50 index (Nifty). The fund manager Invests in the securities in the same weightage comprising of an index.
33. What are diversified equity funds?
These funds invest in equity shares across sectors, sizes and industries. They are less risky because of the diversified nature of the portfolio. Diversified funds may invest in large companies, only smaller mid cap companies or a mix of large and mid-sized companies.
34. What are sector funds?
Sector funds invest in the securities of only those sectors or industries as specified in the offer documents.
35. What are Tax saving funds?
Equity Linked Saving Scheme (ELSS) and Rajiv Gandhi Equity Saving Scheme (RGESS) offer tax benefits on investments.
36. What is ELSS?
Equity linked saving schemes (ELSS) offer tax benefits under Section 80C of the Income Tax Act. Investment up to Rs. 1,50,000 in a year in such funds can be deducted from taxable income of individual investors. An ELSS holds at least 80% of the portfolio in equity securities. Such funds have a lock-in period of 3 years from the date of investment.
37. What is RGESS?
RGESS provides tax benefit to ‘New Retail Investors’, with annual income less than Rs.12 lakh, for investment up to Rs.50,000/-. The scheme invests in CNX 100/BSE 100 shares, select PSU shares, ETFs and mutual fund schemes investing in ‘eligible securities’.
38. What are growth and income funds?
Growth Funds –
The objective of the fund is capital appreciation of the investments over the medium to long term. Majority corpus of such scheme is invested in equities.
Income Funds –
The objective is to provide regular income. Such funds invest mainly in fixed income securities such as bonds, corporate debentures and Government securities.
39. What are Fund of Funds?
Fund of funds (FoFs) invests in other funds. Its portfolio is not made up of securities, but is a portfolio of funds as per the investment objective of the FoF. Some fund of funds may invest in other mutual funds, not necessarily from the same fund house. They are called multi-manager funds.
40. What are hybrid funds?
Funds that have a combination of debt and equity in their portfolio are called hybrid funds. They may serve the needs of investors who look for a combination of income-oriented and growth-oriented investments.
41. What are balanced funds?
Balanced funds are equity-oriented hybrids that invest at least 65% in equity, and the rest in debt securities to offer a cushion from the risk of an all equity portfolio. They are sought by investors who seek growth with some protection from volatility.
42. What is a monthly income plan (MIP)?
MIP invests a larger proportion of the portfolio in debt securities, with a smaller allocation to equity (usually 5% to 30%). They are suitable for investors predominantly looking for regular income.
43. What are international funds?
An international fund can invest into one or more foreign funds. Some of them may invest in a combination of Indian securities and international securities. They are suitable for investors looking for international diversification to their investments.
44. What are exchange traded funds (ETFs)?
ETFs are open-ended funds that track a market index, but are listed on the stock exchange. Purchase and sale transactions are completed on the stock exchange through a broker. Demat accounts are used for settlement of the transactions. ETFs can be bought or sold at market prices, without waiting for the NAV that is declared only at the end of the day.
45. What are the factors to consider while selecting a mutual fund scheme?
The appropriate fund for investment by an investor is one whose investment objective matches that of the investor. Schemes may be fitted to investor objectives based on three basic criteria: risk, return and investing horizon. Every fund product would offer a different combination of these basic characteristics. Selection of funds requires evaluation of these features, before making an investment decision.
46. When should I consider investing in an equity fund?
You may choose equity funds if the requirement for return is higher, investing horizon is longer; and ability to take on short-term volatility for long-term growth is higher.
47. When should I consider investing in a debt fund?
If you seek lower risks, have a shorter investing horizon and are willing to settle for a lower return, you may consider investing in debt funds.
48. What are the factors to consider while selecting an equity mutual fund?
Longer term performance rather than short-term returns should be used to select equity funds
Concentration of a portfolio can also be assessed from the number of stocks and sectors to which the fund has exposure. Higher the concentration higher the risk
The market cap of the stocks in the portfolio should be in line with the objectives of the portfolio
If the stocks held in a portfolio are changed very frequently it may indicate timing and momentum trading as strategies to generate return increasing transaction costs
Larger-sized fund brings in efficiencies of cost and operations but it may restrict the ability of the fund in responding to the changing market situations.
An older fund will have a longer performance history for evaluation and may be preferred
An actively managed fund may be riskier than a passive fund. Dividend yield funds that focus on value are less risky, compared to growth-oriented funds.
49. What are the factors to consider while selecting a debt fund?
The investing horizon of the investor may be matched
Yield & Total Return:
The yield of a debt fund portfolio indicates the return that the portfolio is earning.
A debt fund with lower expense ratio should be preferred to those with higher expense ratios.
The credit rating of instruments in the portfolio indicates the extent of credit risk in the fund
Performance of the fund:
Performance of debt funds is typically evaluated for periods from three months to one year.
50. How do mutual funds help me save tax?
Equity funds that are specially designated as equity linked saving schemes (ELSS) that offer tax benefits to individuals under Section 80C of the Income Tax Act upto Rs.1,50,000 in a financial year.
51. What are the benefits of investing in a mutual fund?
52. How do mutual funds help mitigate risks from investing in the market?
Portfolio diversification is a benefit derived from investment in securities spread across various companies, industries, issuers and maturities. The portfolio will not be affected by the performance of one or few of the securities.
53. My transaction costs of direct investing in the market are typically higher. Will the mutual fund charges also be similarly high?
Mutual funds feature low transaction cost from economies of scale. Since the fund invests large sums of money, the costs of research, broking, demat and custodial services come down. Small amounts invested in a fund get the benefits of the large pool.
54. Can I just not invest directly and create a portfolio of securities?
Professional management by mutual funds offers expertise in managing the investors’ funds, bringing the benefits of research, analysis and process-driven approach to investing, which may not be possible for you as individual investors. Instead of a large outlay of funds to achieve these objectives directly, investors can choose mutual funds, investing as little as Rs.500 to get these benefits at a low cost.
55. Mutual funds are not customized portfolios. Are there enough options available for me as an investor to choose products that I am looking for?
Investors can choose their investment to suit their particular needs and preferences. Mutual funds offer closed and open-ended schemes, offer options to stay invested, receive or reinvest dividends. These variations offer higher flexibility of when to invest, how to receive the returns, how long to stay invested and when to redeem the units.
56. Do mutual funds only allow lump sum investments? Will mutual funds allow me to invest systematically?
Mutual funds encourage systematic investments. Investors can choose systematic investment plans to invest regularly, systematic withdrawal plans to withdraw regularly in order to structure regular cash flow from the investment account or systematic transfer plans to transfer money from one scheme to another.
57. Will I be able to redeem my investments whenever I want to?
Mutual funds structure the portfolio in such a way that they are able to provide liquidity to the investor
58. How safe is it to invest in mutual funds?
Mutual funds are created as a trust, primarily so as to safeguard interests of investors. They are closely regulated by Sebi which is the primary regulatory authority for the Indian markets as a whole. The structure of a mutual fund is also well regulated, offering a high level of information disclosure, investor protection and regulatory controls. Mutual fund distributors have to be registered with Amfi obtain an ARN and abide by the prescribed code of ethics.
59. What are the risks involved with investing in a mutual fund?
Mutual fund investments involve an element of risk. Some of the risks they face are –
Market Risk – Risk faced by an investor due to change in the value of a share of a company. A mutual fund will reduce the risk by diversified portfolio.
Credit Risk – There are risks that the company may fail and be unable to give back the promised amount.
Interest Rate Risk - As interest rates rise, the price of a fixed rate bond falls, and vice versa.
Inflation Risk – Inflation reduces the purchasing power. Investor faces the risk when the rate of inflation exceeds the rate of return on investments.
Changes in the Government Policy – government policy and taxation affects the company which in turn is reflected in the share price.
60. What are the different ways of investing in mutual funds?
Offline through application forms
and other distributor portals
61. What are the different modes of investing in mutual funds?
Through Agents (Offline through application form)
Through mutual fund distributor or broker
Through corporate agents
Through share broking portal
Through online mutual fund agents
Mutual Fund Utilities
Through mutual fund branch
Through investor service centre (Karvy office)
Through mutual fund online website
62. What is dividend option?
In dividend options the profit earned by the companies is distributed as dividend. The dividend is paid from the NAV of the unit. The NAV of the fund is adjusted according to the dividend paid out. An investor also has an option to re-invest the dividend.
63. What is the growth option?
In the growth option, profits made by the scheme are invested back into it. This results in the net asset value (NAV) of the scheme rising over time.
64. What is Systematic Investment Plan (SIP)?
SIPs enable investors to invest a fixed sum periodically into a mutual fund scheme. Units are bought at the NAV-related price prevailing on the date of investment. The investment is thus staggered over time, reducing the risk of investing a lump sum at a specific time. Systematic investment thus lowers the average cost of purchase. This strategy is called as rupee cost averaging.
65. What is Systematic Withdrawal Plan (SWP)?
SWPs allow investors to make periodic redemptions at the prevailing NAV (less exit load as applicable). SWP enables investors to periodically book their profits in an investment. Investors are also able to generate a regular income by redeeming periodically, without the fund having to declare a dividend. Capital gains taxes will apply, depending on the nature of the scheme and holding period.
66. What is Systematic Transfer Plan (STP)?
STPs permit investors to periodically transfer a specified sum from one scheme to another within the same fund house. The transfer is considered as redemption from the scheme from which transfer is made (source scheme) and investment into the scheme in which the redemption proceeds are invested (destination scheme). The transfers are done at the applicable NAV on the date of the transaction. Loads will apply according to the policy of the AMC.
67. What is the right time to sell or exit a mutual fund investment?
The fund consistently underperforms
The fund deviates from its objective
You want to rebalance your portfolio
You had set a goal for the investment and it has been reached
68. What are the costs and expenses involved in mutual fund investing?
Asset management companies (AMCs) manage the assets of the mutual funds and take the investment decisions. These form part of the expense ratio. Apart from the expense ratio, you must bear the charges at the time of entry or exit.
69. What is the entry load?
It is a front-end charge deducted from the NAV at the time of investing in a mutual fund scheme. SEBI abolished entry loads in August 2009.
70. What is the exit load?
It is a charge levied when an investor redeems / sells his units in a short span of time since he made the investment. Mutual funds charge exit loads to deter investors from leaving mutual fund schemes before holding them for the recommended investment horizon.
71. What is the transaction charge?
For a first time investor, AMCs collect Rs 150 as a fee if the investment amount is more than Rs. 10,000 and Rs.100 for an existing investor. No fee can be charged for any amount less than Rs.10,000.
72. What are the expenses of mutual fund that the investor needs to bear?
All funds charge fee for their expenses.
This is reflected in the expense ratio. AMCs charge investors for professional fund management and regular operational costs such as fees for fund management, marketing and selling expenses, including commissions, fees related to the holding and transaction in securities, audit and costs relating to investor communication and statutory disclosure.
73. Why do direct plans have a lower expense ratio?
All mutual funds provide a separate plan for direct investments (investments not routed through a distributor) in all schemes. These separate plans have a lower expense ratio, as distribution expenses and commission are excluded.
74. Do all mutual funds have the same structure for expense ratio?
Different mutual funds may have different expense ratios. Passively managed funds like index funds or ETFs have lower expense ratio than actively managed funds. Actively managed funds may also have different expense ratios, both within a fund house and between various fund houses. Lower costs reflect the operational efficiency of a mutual fund house.
75. How do costs affect returns on mutual fund?
Expenses are reduced from the net assets of the scheme. Therefore, higher expenses reduce the NAV and hence, returns to the investors. All other factors remaining the same, you must invest in a fund which has low expense ratio.
75. How do costs affect returns on mutual fund?
Expenses are reduced from the net assets of the scheme. Therefore, higher expenses reduce the NAV and hence, returns to the investors. All other factors remaining the same, you must invest in a fund which has low expense ratio.
1. What is FATCA?
FATCA refers to Foreign Account Tax Compliance Act which is a United States (US) legislation targeted at tax non-compliance by US persons with offshore accounts including those in India.
2. How is India involved in FATCA compliance?
The Indian Government has signed an Inter-Governmental Agreement (IGA) with the US to implement FATCA in India. In terms of the IGA, financial institutions in India are required to report information about US persons to the Indian Tax Authorities, who will further send it to US Tax authorities (US Internal Revenue Service – IRS).
3. What is CRS?
Just like FATCA, Common Reporting Standard (CRS), has been developed under the purview of the Organization for Economic Co-operation and Development (OECD) to exchange data amongst member nations for tax purposes. India is a signatory to the agreement on implementation of CRS.
4. How have the Indian Tax Authorities implemented these regulations in India?
CBDT has framed rules for FATCA and CRS compliance applicable to Indian financial institutions. Compliance with the rules involves disclosures,maintainance of information, registration of persons and reporting.
5. How does FATCA /CRS affect my investments?
Financial Institutions such as mutual funds including IDBI Mutual Fund are required to seek additional personal, tax and beneficial owner information, self-certifications and documentation from our unitholders.
6. When is information/declaration/self-certification sought under FATCA/CRS?
Information/declaration/self-certification under FATCA/CRS may be sought at the time of opening the account or any time subsequently.
7. Who is covered under FATCA and CRS, only US investors, or NRIs?
No. All investors, Individuals and non-individual, are covered under FATCA and CRS.
8. Who is a U.S. person?
The term "United States person" means:
A citizen or resident of the United States,
A partnership created or organized in the United States or under the law of the United States or of any State, or the District of Columbia,
A corporation created or organized in the United States or under the law of the United States or of any State, or the District of Columbia,
Any estate or trust other than a foreign estate or foreign trust. (See Internal Revenue Code section 7701(a)(31) for the definition of a foreign estate and a foreign trust.), or
Any other person that is not a foreign person.
9. Who is a U.S. Citizen?
The term "United States Citizen" means:
An individual born in the United States,
An individual whose parent is a U.S. citizen,
A former alien who has been naturalized as a U.S. citizen,
An individual born in Puerto Rico,
An individual born in Guam, or
An individual born in the U.S. Virgin Islands.
10. Information sought by IDBI Mutual Fund is reported to which entity?
Information sought under FATCA/CRS by IDBI Mutual Fund will be reported to the Income Tax Authorities in India, who will further transmit the information to the tax authorities of the relevant country.
11. What information is sought from the investor?
Information with respect to Country of tax residence, Tax Identification Number from such country, Country of Birth, Country of Citizenship, is required to be furnished.
12. How frequently is information sought under FATCA/CRS?
Information is sought only once from the investor. However, if there is any mismatch in the information submitted, the investor may be contacted to submit additional documentation/information. If there is a change in the information already provided, the investor is required to update IDBI Mutual Fund.
13. What if an investor does not provide information sought under FATCA/CRS?
If a new investor refuses to provide information sought under FATCA/CRS, then he/she may not be allowed to open a folio.
In case of existing investors, if there is any failure or delay in providing such information, the same may be reported to the tax authorities. If instructed by tax authorities, IDBI Mutual Fund may have to withhold and pay out funds from your account or close or suspend your account.
14. Is there any place where I can find detailed information on FATCA/CRS?
15. How can I complete FATCA/CRS compliance?
Investors can complete their FATCA/CRS compliance by providing requisite information by accessing the following
1. What are the fundamental attributes of a scheme?
The fundamental attributes of a scheme are the essential features of the scheme, such as structure, investment pattern, which is unique to the scheme.
2. How are the fundamental attributes of a scheme useful to me?
The return and risk parameters of a scheme depend upon its fundamental attributes. Hence it enables an investor to decide if a scheme is appropriate and to differentiate it from other products.
3. Can a mutual fund change its fundamental attributes?
A mutual fund cannot change any of its fundamental attributes without notifying the existing unit holders and giving them 30-days’ notice in the newspapers with an option to redeem without charging exit load.
4. How will I come to know if there is a change in the management?
If there is a change of sponsor or the investment manager of the mutual fund, then the unit holders are notified at least 30 days in advance.
5. What are the service standards that mutual funds have to follow?
Allotment of units in a NFO (other than ELSS and RGESS)
5 days from NFO closing date
Allotment of units in a ELSS and RGESS NFO
30 days from NFO closing date
Refund of money
5 business days from NFO closing date (15 days for RGESS)
Dispatch of Statement of account - NFO or request by unit holder
5 working days from closure of subscription list / request (15 days for RGESS)
Dispatch of Consolidated Account Statement (CAS)
10 days from end of each calendar month if transaction has taken place during the month.
Dispatch of dividend warrants
30 days from date of dividend declaration
Dispatch of redemption proceeds
10 working days from transaction request
1. What is KYC?
In order to ensure that illegal funds are not routed into Indian markets, the government has mandated the Prevention of Money Laundering Act (PMLA). According to this Act the identity of those entering into financial transactions must be known and verified. The procedure to do this is now known as KYC (Know Your Customer) norms.
2. How can I complete my KYC formalities or become KYC compliant?
SEBI has developed a uniform KYC process. An investor needs to complete the KYC formalities with a KYC Registration Agency (KRA) by providing proof of identity, proof of address and In-person verification. KRA is the centralized agency, which maintains the KYC records of the investors.
3. How many KRAs are registered with SEBI?
There are 5 KRA’s registered with SEBI
4. Where can I get the KYC forms?
The KYC forms can be downloaded from the
or from the respective KRA websites.
5. Where can I submit my KYC form and documents?
Investor can submit the documents and form to any of our
Investor Service Centre’s
or to the
CAMS-Investor Services Centre
6. How will I come to know my KYC compliance status?
Investor can check the KYC compliant status on the respective KRA websites.
Ultimate Beneficial Owner
7. Who is an Ultimate Beneficial Owner (UBO)?
Ultimate Beneficial Owner is one who ultimately owns or controls the investment. All categories of investors (except individuals, listed companies and majority owned subsidiaries of listed companies) have to provide information about beneficial ownership. An UBO of a company is one who owns or is entitled to more than 25% of its shares or profits and more than 15% in case of partnerships and body of persons.
8. How can I register the UBO?
Investor can fill up the ‘Declaration of Ultimate Beneficial Ownership’ Form and submit to the nearest Investor Service Centre’s of IDBI mutual fund. The information is updated in the central data base CAMS and shared with all other AMC’s where investor has investments.
Subscription Related FAQs
9. I am a resident individual, what documents I need to submit to invest in a mutual fund?
An investor needs to submit the following documents to any of our
Investor Service Centre’s
or to the
CAMS-Investor Services Centre
Common application form -
Third party declaration
KYC Acknowledgement (Verified by KRA)
10. Being non-individual entity, what documents need to be submitted to invest in a mutual fund?
Investors, other than resident individuals needs to submit the following documents–
Common Application form -
Third party declaration
Check list - All documents should be original / true copies certified by a Director / Trustee / Company Secretary / Authorized signatory / Notary Public / AMC or R&T Officials)
Investment through PoA
Copy of the PAN Card
Copy of the KYC acknowledgement
Resolution / Authorization to invest
List of authorized signatories with specimen signatures
Overseas Auditor Certificate and SEBI registration certificate
Proof of Address
Foreign Inward Remittance Certificate
Foreign Account Tax Compliance Act (FATCA)
Ultimate Beneficial Owner (UBO)
11. How can I opt for units in Demat mode at the time of subscription in NFO?
Investor needs to select the Unit holding Option Mode as DMAT in the Application form and specify the Depository Participant name, DP Id/Client ID of beneficiary on the application.
Joint Holdings FAQs
12. I am a joint holder in a Mutual Fund investment account (folio). Do I need to comply with KYC requirement?
Yes, all the holders need to be KYC compliant.
13. I am a joint holder in a Mutual Fund investment account (folio). Do I need to be related to the first holder?
No, it is not necessary for the joint holders to be related to each other or sharing any blood relationship.
14. Maximum how many people can jointly open an account?
Maximum 3 persons can jointly open an account.
15. What is the difference between “joint holding mode” and “anyone or survivor” in a joint account?
Under the "joint holding" mode, financial and non-financial transaction requests should be signed by all unitholders of the folio.
Under "anyone or survivor" mode, any one of the unitholders may sign the financial and non-financial transaction requests.
16. Can I add a new joint account holder or delete an existing one?
No, an investor cannot add or delete the joint account holder to an existing folio.
17. What is meant by nomination?
Nomination is a facility that enables a unit holders to nominate a person to whom the units can be transferred in the event of their death.
18. How is nomination beneficial?
In the event of the investor’s death, units are transferred to the nominee. This ensures hassle free transfer of investments to the person appointed as the nominee.
19. How can I nominate a person?
Nomination can be made in the application form at the time of purchases, or at any subsequent time, using a nomination form.
20. Can I have the nomination facility in a joint account?
Yes, joint accounts can have nominations.
21. Can there be more than one nominee in an account?
Yes, you can nominate maximum 3 nominees in the folio
22. Who is a minor investor?
Minors are investors who are less than 18 years of age on the date of investment.
23. Can minors operate the account?
Minors cannot operate the account. The financial transactions are conducted on their behalf by the natural guardian (i.e. father or mother) or a court appointed legal guardian.
24. Can minors open joint accounts with their parents or brothers or sisters?
There cannot be any joint accounts with minor as the first or joint holder
25. What are the documents required for opening the account of a minor?
Date of birth of the minor is mandatory along with photocopy of supporting documents
Birth proof of the minor
Document to establish the relationship of the guardian with the minor
Permanent account number (PAN) of the guardian who is investing on behalf of a minor.
26. What is the limit on the amount that can be invested on behalf of the minor?
There is no limit to the amount invested if the payment is done from the minor’s bank account. However, payment by Parents/Grand-Parents/related persons on behalf of a minor is limited to a value not exceeding Rs.50, 000/- (each regular purchase or per SIP installment).
27. Can the minor start operating the account directly once he/she attains 18?
No transactions are allowed in a minors account, till the status is changed from minor to major.
28. What is the process of changing the status of minor to major?
List of standard documents to change account status from minor to major:-
Services Request form, duly filled and containing details like name of major, folio numbers, etc.
New Bank mandate where account changed from minor to major
Signature attestation of the major by a manager of a scheduled bank / Bank Certificate / Letter
KYC acknowledgement of the major
Investment account or Folio related FAQs
29. What is a folio?
Investors in mutual funds are allotted a folio number when they make a first purchase with a fund house, whether in an NFO or in an existing scheme. It is like a bank account number.
30. What is the use of folio?
Investors can make and hold multiple investments in a single folio.
31. Can I have more than one investment account or folio?
Yes, investor can hold multiple investment account or folio.
32. How can I close my account or folio?
An investor can download the
cancellation request form
and submit at the Official Point(s) of Acceptance of IDBI mutual fund or CAMS.
33. Can I close the account if I have units in the folio?
No, before closing the account, an investor needs to redeem all the units in the folio.
Registering multiple bank account statements
34. Can I register more than one bank account in my folio?
An investor can register up to 5 bank accounts in folio. One account as “default” and up to 4 additional bank accounts.
35. How can I register multiple bank accounts?
Investor can download the
multiple bank accounts registration form.
The form needs to be submitted along with a cancelled cheque of such bank accounts at the official point of acceptance of IDBI mutual funds.
Registering multiple bank account statements
36. How often is the NAV declared?
NAV of IDBI mutual fund schemes is declared on a daily basis by 9.00 p.m. and updated on the
37. What is the applicable cut-off time in respect to purchase of mutual fund units?
Type of Scheme
Cut off Time
Equity oriented funds and debt funds (except liquid funds) in respect of purchases less than Rs.2 lacs
Purchases Switch -ins
Same day NAV if received before cut off time.Next business day NAV for applications received after cut off time
Equity oriented funds and debt funds (except liquid funds) in respect of transaction of Rs.2 lacs or more
Purchases Switch -ins
NAV of the business day on which funds for the entire amount of subscription / purchase as per the application are available for utilization before the cutoff time will apply
For purchase transaction of Liquid and Money Market funds?
Type of Scheme
Cut off Time
Purchases Switch –ins
Previous day NAV if received before cut off time and funds are realized.If received after cut off time, NAV of the day previous to funds realization.
Equity Oriented Funds, Debt funds, Liquid funds
Redemptions Switch –outs
Same day NAV if received before cut-off time.Next business day NAV for applications received after cut off time.
38. What do I get as my proof of investment in a mutual fund?
Mutual fund emails statement of account to the registered email-id of an investor as a proof of investment.
39. How can I purchase additional units in my mutual fund?
Investor can purchase either through –
Physical mode – can
download the transaction slip form -
and submit at the nearest point of acceptance of IDBI mutual fund
Online mode – investor can
log in with registered User ID and password
to purchase the additional units.
40. Can I transact through my mobile?
Existing investor of IDBI Mutual Fund can transact through Mobile by Transaction over SMS facility.
41. Do I need to pay any charges for online transactions?
No, there are no charges for online transactions.
42. How can I invest through stock exchange?
An investor needs to register with any of our distributor who offers the facility of electronic buy / sell of MF units.
43. Do I need to pay any transaction charges?
Yes, as per SEBI guidelines, a distributor is entitled to charge transaction charge per subscription of Rs.10, 000 and above.
44. What are the transaction charges levied by a mutual fund?
For direct investments there is no transaction charge
For existing investor a transaction charge of Rs.100 for each mutual fund subscription above Rs.10, 000.
First time mutual fund investor, the transaction charge that can be levied is Rs.150.
SIPs - The transaction charge shall be applicable only if the total commitment through the SIP amounts to Rs.10, 000 and above. These charges can be recovered over 3-4 installments.
Consolidated Account Statement
45. What is a Consolidated Account Statement CAS?
Consolidated Account Statement is an account statement that allows an investor to view all their holdings and transactions as of a specified date across all schemes of all mutual funds.
46. When do I receive my account statement?
The account statement is emailed not later than 10 business days from the date of transaction. In case of an NFO, the SoA must be emailed to investors within 5 days of allotment.
47. When do I start receiving the consolidated account statement?
CAS is generally sent every month, for your mutual fund transactions during a calendar month and dispatched to you before the 10th of the succeeding month.
48. Are there any charge or fees that I need to pay to receive the CAS?
There are no charges or fees to be paid by a unit holder to receive the CAS.
49. What if I have not transacted in a folio for a long period of time?
If there are no transactions in a folio in a half year period ending September or March, CAS is sent at the end of the 6 months period.
50. How do I download the account statement from Karvy website?
Investor can download the account statement by visiting the following link –
51. How do I redeem the units in the demat account?
An investor needs to transact through stock exchange by approaching the depository participant/broker for redeeming the units.
52. How can I redeem the units?
An investor can redeem the units by submitting a written request or transaction slip at the nearest point of acceptance of IDBI mutual fund.
The transaction slip can be download
Investor can also redeem the units online by
logging in with the registered User ID and password mode –
53. Are there any charges applied while redeeming the units?
Following charges are applicable while redeeming the units –
Exit load, if any
Securities Transaction Tax (STT)
54. How will I receive my redemption proceeds?
The redemption proceeds are paid out to the registered bank account of an investor as updated in the folio.
55. Within how many days will I receive the dividend?
SEBI has mandated to pay the dividends within 30 days. Generally, it is paid within 10 working days from the record date.
Systematic Withdrawal Plan (SWP)
56. What is systematic withdrawal plan (SWP)?
This facility allows unit holders to withdraw a fixed amount on monthly basis by redemption of units in the unit holders’ account.
57. How can I set up a systematic withdrawal plan?
An investor can download and fill up a common form for Systematic transactions and choose Systematic Withdrawal Plan.
The form can be download.
The form should be submitted to Official Point(s) of Acceptance at least 7 days before the date of commencement / start date of SWP.
58. When can I withdraw from the plan?
Investors can withdraw the amount on the 25th of each month. In case the 25th of the month is a non-business day, the transaction would be effected on the next business day.
59. Do I get statement of account for the withdrawal plan?
Yes, the first account statement is sent to investors within 10 working days from the date of the transaction, confirming the first systematic transaction and for subsequent transactions, the account statement is sent on a quarterly basis.
60. How can I discontinue the SWP facility?
Unitholder can discontinue SWP facility at any time by sending a written notice to any of the Official Point(s) of Acceptance, at least 7 days prior to next SWP execution date.
61. What is meant by Switch?
A switch is a redemption and purchase transaction rolled into one. A redeeming scheme is called source scheme from which money is switched out. The purchasing scheme is called target scheme, into which the money is switched in.
62. What will be the applicable NAV for the switch transactions?
Switchover between the Growth and Dividend Options of the same scheme will be at the applicable NAV and switchovers to other schemes will be at NAV related prices.
Systematic Transfer Plan
63. What is systematic transfer plan (STP)?
This facility allows Unit holders to transfer specified fixed sums on periodic basis from one scheme to other scheme launched by the Mutual Fund from time to time by giving a single instruction.
64. How to register for STP
An investor can download and fill up the Common form for Systematic transactions and choose STP. The form can be
.The form should be submitted to Official Point(s) of Acceptance at least 7 days before the date of commencement / start date of STP.
65. What is the frequency of transfer?
STP facility is offered -
Daily (only offered under ILIQF, IUSTF & ISTBF; on all Business days),
Weekly (1st Business day of the week),
Monthly and (1st, 5th, 10th, 15th, 20th or 25th of the month under monthly)
Quarterly – (1st month of each quarter under quarterly)
66. How can I discontinue the STP facility?
Unitholder can discontinue STP facility at any time by sending a written notice to any of the Official Point(s) of Acceptance, at least 7 days prior to next transfer / STP execution date.
Systematic Investment Plan
67. What is systematic investment plan?
SIPs enable investors to invest a fixed sum periodically into a mutual fund scheme.
68. What is the frequency of investing in a SIP?
SIP is offered on Daily (only IDBI Ultra Short Term Fund), monthly and quarterly frequency
69. Is there any particular date to invest in a SIP?
Unit holders can opt to invest in monthly or quarterly frequency on the following dates - 1st, 5th, 10th, 15th, 20th and 25th of each month / first month of the quarter.
70. What is the minimum Investment option available in SIP?
Minimum amount to be invested is Rs.500 and in case of micro-sip it is Rs.50
71. How can I start a SIP?
An investor can start a SIP by submitting the following documents at the official point of acceptance of IDBI mutual fund-
Common application form
Investor can download the form by visiting at-
72. When will the SIP amount start getting debited from my bank account?
It usually takes about 15 - 21 working days to process the documents and initiate SIP.
73. Can I start a new SIP in my existing folio?
Yes, investor can start a new SIP in an existing folio. Investor can start by submitting the
SIP enrollment form
at the nearest official point of acceptance of IDBI mutual funds.
74. Can I invest in multiple SIPs in the same scheme?
Yes, an investor can register for multiple SIPs in the same scheme but with different SIP dates.
75. Can I change the amount invested in a SIP?
Yes, investor can change the amount of SIP by discontinuing an existing SIP and starting a new SIP
76. How can I discontinue the existing SIP?
Investor can discontinue the SIP facility by sending written request to any Official Points of Acceptance of IDBI mutual fund, at least 21 calendar days prior to the next ECS debit / Direct debit.
77. How will I come to know my SIP has ended?
Asset Management Companies usually send a communication to investors towards the end of the SIP term, asking to renew the SIP for an additional period.
78. How can I renew my SIP?
You can renew the SIP by submitting the SIP form with the new term along with the cancelled cheque at the nearest official point of acceptance of IDBI mutual fund
79. How do I transfer units for investment (Transmission Process)?
For transferring the units an investor needs to submit the following
documents link -
80. What is meant by Lien Marking
When an investor is in need of funds, he/she can pledge the units of mutual funds as collateral to banks or financial institutions to avail funds.
81. How can mark lien on my investment?
The investor needs to make a request in writing to mark a lien providing the details of the folio number, scheme name, plan, option and the number of units. This letter, along with a covering letter from the institution providing the loan is to be submitted to our official point of acceptance.
Investor Grievances FAQs
82. If I have any complaint or grievance relating to my mutual fund investment, how should I get it resolved?
Investors have two options. They can approach
The Registrar, Karvy at the below mentioned details -
Registrar - Karvy Computershare Pvt. Ltd.
SEBI Registration Number: INR000000221
Unit: IDBI Mutual Fund
KARVY SELENIUM, Plot No.31 & 32, Tower B, Survey No.115/22, 115/24 & 115/25, Financial District, Gachibowli, Nanakramguda, Serlingampally Mandal, Hyderabad - 500 032, Ranga Reddy District, Telengana State.
Phone: 040-3321 5121 to 040-3321 5123.
Or they can approach the Trustees at,(http://www.idbimutual.co.in/trustees.asp)
83. What if my complaint remains unresolved or I am not satisfied with the response given by the mutual fund?
If an investor’s complaint is unresolved or not satisfied with the response of the mutual fund, he/she can lodge their grievances with SEBI at
or can also write to SEBI at the below mentioned address.
Securities and Exchange Board of India
Office of Investor Assistance and Education (OIAE)
Plot No.C4-A, “G” Block, 1st Floor,
Bandra (E), Mumbai – 400 051
Non-Financial Transactions FAQs
84. What is the process of changing my address in the folio?
The prescribed form of change in details can be downloaded from
The form along with the new proof of address can be submitted any of the designated point of service. The list of PoS can be found at
85. How can I change the bank details?
An investor can change the bank account details by submitting the following documents–
Transaction slip/Request letter from investor
Cancelled original cheque for New Bank Mandate; OR
Original Bank Statement. True copy can be accepted if original is brought to the branch for verification; OR
True copy of Bank Passbook, if the original Passbook is brought to branch for Verification
86. After my marriage, how can I change my investments to my new maiden name?
Investor needs to get KYC compliant with new maiden name changes.
Post that they need to submit a letter to us with the following documents –
Attested copy of marriage certificate
New signature attested by the investor’s banker
Cancelled cheque with new name printed on it
Copy of acknowledgment received from KRA for change in KYC details
Copy of PAN with new name
New address proof such as electricity bill, new passport copy etc.
87. What is the procedure for registration of Power of Attorney (POA) in a folio?
An investor needs to submit a certified copy of Power of Attorney, with signatures of both parties, along with the common application form.
FAQ’s for Non Resident Indians
1. Who is a Non-Resident Indian (NRI)?
A non-resident Indian is an Indian citizen or a person of Indian origin (PIO) who is residing outside India. A resident is an Indian citizen, who has stayed in India for at least 182 days in a financial year.
2. Who is a Person of Indian Origin (PIO)?
He at any time held an Indian passport or
He or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 or
He is spouse of an Indian citizen or a person referred to in the first two points above.
3. Who is a Foreign Institutional Investor (FII)?
A foreign institutional investor (FII) is an institution incorporated outside India and registered with SEBI to make investments in Indian securities.
4. Who is a qualified foreign investor (QFI)?
Qualified foreign investors are individuals or association of persons which are registered with SEBI and who wish to make investments in Indian securities.
5. Who is a foreign portfolio investor (FPI)
FIIs and QFIs have now been clubbed under a single category of investors and are registered with SEBI as foreign portfolio investors.
6. Can an NRI maintain a bank account in India?
Yes. NRIs can maintain bank accounts in India. NRI bank accounts can be in the form of rupee accounts or foreign currency accounts. Foreign currency accounts can be maintained only with RBI authorized dealers or banks.
7. What are the different types of rupee accounts that are permitted and can be maintained by NRIs?
NRIs can maintain the following types of rupee accounts with Banks:
Non Resident (External) Rupee Account (NRE account)
Non Resident (Ordinary) Rupee Account (NRO account)
Foreign Currency (Non Resident) Account (FCNR account)
8. What are NRE and NRO accounts?
NRE account is a rupee account maintained with a bank. Funds from an NRE account are freely repatriable. Interest credited to the NRE account is exempt from tax in the hands of the NRI. NRE accounts can be opened with funds remitted from abroad or generated in India.
NRIs can open NRO account for the purpose of putting through bona fide transaction in rupees. Balance in the NRO account is generally non-repatriable. However, funds in NRO accounts can be remitted abroad subject to such limits and conditions as may be prescribed by RBI directives at the time of repatriation.
9. What is the distinction among NRE and NRO Accounts?
NRE account balances are allowed to be repatriated abroad freely. However, balances in the NRO account cannot be repatriated freely. NRO account balances need to be used only for payments within India in rupees.
10. Can NRIs & FIIs invest in mutual funds in India?
Yes, NRIs and FIIs can invest in mutual funds in India subject to compliance with applicable KYC and Anti-Money Laundering and FATCA regulations as the case may be. However, NRIs and PIOs who are residents of the United States of America/defined as United States Persons under applicable laws/ statutes and the residents of Canada cannot invest in IDBI Fixed Maturity Plans.
11. Does an NRI, PIO, FII require any approval from the RBI to invest in mutual fund schemes?
No, NRI, PIO or FIIs do not require any special approval from the RBI to invest in Mutual fund schemes in India.
12. What is a PIO Card? Who Issues PIO Cards? How to get a PIO Card?
A PIO card is a card issued to Persons of Indian Origin (PIOs) by the Government of India. As per the Gazette of India (Part-I, Section-I) published on 09.01.2015, all the existing Persons of Indian Origin (PIO) card holder registered under the PIO Card scheme 2002, shall be deemed to be Overseas Citizens of India Cardholder. However, a PIO card issued to an applicant shall be valid for his lifetime, provided such applicant has a valid Passport.
13. How to contact IDBI Mutual Fund from Overseas location
NRIs can contact IDBI Mutual Fund on our toll free number 1800-419-4324 or write to us at
Investment by NRIs in IDBI Mutual Fund
1. How does an NRI invest in IDBI Mutual Fund (IDBI MF)?
An NRI investor needs to fill an application form obtained from AMC or Investor Services Centers of the Registrar or distributors or
The form needs to be submitted along with KYC acknowledgment and a rupee cheque or rupee draft in the name of the scheme to any nearest office of the distributor or point of service. An NRI investor who has already registered with us has an option to transact online. The investor needs to obtain a PIN by
visiting our website
Documents to be attached along with the application form are –
A copy of passport/PIO Card/OCI Card
Overseas address proof
Copy of PAN card self-attested by the investor
KYC documents attested by the branches of Scheduled Commercial Banks registered in India, Notary Public, Court Magistrate, Judge, Indian Embassy /Consulate General in the country where the client resides
2. Can an NRI invest in foreign currency?
NRIs cannot invest in foreign currency. They have to issue a Rupee cheque drawn on their NRE or NRO bank account in India.
3. What is the mode of payment for Repatriation and Non-Repatriation Basis?
NRI investors can invest in schemes on repatriation or a non-repatriation basis. However, the principal is non-repatriable while the income distributions are repatriable.
On Repatriable Basis – if the purchase or sale transactions is through repatriation mode then the amount is debited or credited to the NRE/FCNR account.
On Non-Repatriable Basis – If the units are bought or sold on non-repatriation basis, then NRO account is debited or credited subject to payment of taxes.
4. The cheque or the DD should be payable or drawn on which location?
The cheque or DD should be payable or drawn to any of our nearest office of the distributor or the official point of service of IDBI Mutual Fund.
5. Will IDBI MF accept an NRI application with an overseas bank account detail?
Oversees bank account details is not accepted in an NRI application. The mutual fund does not accept payments in foreign currency, it shall be done in Indian rupees only.
6. After an application for investment when will the units be allotted to the NRI?
If the application is received before the cut-off time on a business day then the units are allotted at the same day NAV. If the application is received after the cut-off time then units are allotted based on the next business day’s NAV.
7. Is there any load charged on switching?
Yes, there are load charges on switching. However, the difference of the entry load will be applicable
8. How does an NRI get updated on the performance of the schemes?
An investor can log in
and manage the investments online through prescribed Login ID and password. The fund also publishes fact sheets on monthly basis, which mentions the details of the portfolio and its performance.
9. How can an NRI carry out transactions like additional purchase / redemption / switching?
There are 2 ways an NRI can carry out the transactions like additional purchase/redemption/switching –
Online – by logging in with the
Login ID and password
Physical – Downloading the transaction/services related form
The duly filled form can be mailed to any official point of services.
KYC by NRIs in IDBI Mutual Fund
10. What address should be mentioned on the application form? Can an NRI mention a local address for all communication?
It is compulsory for an NRI to provide oversees address. However, the form also has provision for local address. The local address provided becomes the registered address to contact and oversees address becomes an alternative address. The statement of account will have Indian address and all investment related communications will be posted to this address. The investor has an option to select foreign address as a registered address for the purpose of communication.
11. Is nomination by NRIs allowed in the schemes of IDBI Mutual Fund?
Yes, nomination is allowed by NRI in the schemes of IDBI mutual fund.
12. Can a resident Indian have an NRI as nominee?
Yes, Indian resident can have an NRI as a nominee.
13. Can an NRI have a joint account in a scheme of IDBI Mutual Fund with a resident Indian?
Yes, NRI can have a joint account in schemes of IDBI mutual fund with resident or non-resident of India
14. Can a Power of Attorney (POA) holder invest on behalf of the NRI investor?
Yes, a POA holder can invest on behalf of the NRI investor. For purchase of units, the POA holder needs to submit original POA or attested copy duly notarized. The POA should contain signatures of NRI investor and POA holder. The signature is verified before processing any request.
Redemption by NRIs in IDBI Mutual Fund
15. How will the redemption proceeds be paid to NRI?
Redemption proceeds from mutual fund schemes are credited to the NRE/NRO/FCNR account of the NRI investor.
Redemption proceeds of investments made on non-repatriation basis are not repatriable. The proceeds are credited to the NRO account of the NRI.
16. How does an NRI investor redeem his/her funds?
An NRI investor needs to submit the original redemption request form at the official point of acceptance. It should contain details of the investors such as folio number, the amount/name of the schemes/unit he/she would like to redeem and should be duly signed by the unit holders on record or their Power Of Attorney (POA) holders.
Repatriation of Income from Mutual Funds
17. Is the Income/Dividend on mutual fund units repatriable?
The dividend income of NRI investor is fully repatriable.
NRI Tax aspects
18. Is the indexation benefit available to NRIs?
Indexation benefit on long term capital gains on redemption of non-equity mutual fund units is also available to NRIs.
19. Are the returns taxable?
Tax Rate for NRI’s
Short term capital gain
Equity Oriented Schemes – 15% Debt Funds & Gold ETF – Tax slab rate
Long term capital gain
Equity Oriented Schemes – Tax free Debt Funds & Gold ETF - 20% with indexation and 10% without indexation
20. When will the TDS certificate be issued?
TDS certificates are issued to investors on a quarterly basis.
21. What is the tax liability for dividend income received from your mutual fund?
Income received from mutual fund schemes is exempt from income tax in India as per Section 10 (35) of the Income Tax Act, 1961. Dividends received by investors in non-equity mutual fund schemes is net of dividend distribution tax. However dividend from mutual fund schemes is tax free in the hands of the investor and hence there is no TDS applicable.
General Risk Factors
IDBI AMC CIN : U65100MH2010PLC199319 IDBI MFT CIN: U65991MH2010PLC199326
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