Must know hack to save taxes | Money Psychology

[@sambhavshah4097]

Theory is perfect and should be used by all small scale retail investors. However buying back shares on same day will be considered as intraday & won't be added to Holdings. I have been performing tax harvesting since 4 years. I made the same mistake during 1st year, which costed me extra intraday charges. SELL TODAY, BUY TOMORROW for tax harvesting.

[@08pkz]

From harvesting in farm to tax harvesting in markets! Ahh what a journey! 😂😂 Thanks for explaining this so beautifully and simply! Super creative way! Loved it! ❤

[@Zero1byZerodha]

Thank you ❤

[@amangarge]

Maybe Coin should come with an feature that allows Tax Harvesting of NAV without manual intervention.

[@ShailendraNaikwadi]

अभी भी नहीं समझे Coin is going to introduce this features This video is to promote it

[@aadityagupta250]

Abhi regulations are such that coin isn't allowed to do that.

[@bbashab]

​@@aadityagupta250how come kuvera has that since ages?

[@aadityagupta250]

@@bbashab kuvera, as far as I know, doesn't automatically do the harvesting. Instead, it recommends transactions to users. So still needs manual intervention. No regulation against that. What they're not allowed to do is sell your mfs without your intervention.

[@vineetkumar-tt8oi]

3:59 i didnt get it, 12.5% of 132641 is 16580.125, where is this 955 coming from ?

[@sujithcp1419]

Good. Now that the government uderstood this, they will make the exemption applicable only for investments more than 5 years.

[@kamalrajan1990]

Ha ha

[@Elninojunior]

nirmala tai

[@luhaarunk3085]

Correct me if I'm wrong. I believe this video should have been better researched. I'm saying this because certain funds have a weekly/fortnightly/monthly ceiling on maximum investment per PAN. SBI small cap, for example does not allow you to invest more than ₹25K/month per PAN. So if one wanted to do the above method for their investment in SBI small cap by exiting the 1-year old investment (which lets say, was ₹25K) and then reinvesting it in the current month, the fund will then not allow another 25K investment for this month. So by attempting tax harvesting, one is essentially locking themselves out of investing this month's SIP i.e. in a way, stopping their SIP.

[@ojas.rastogi]

That may be true, but you cannot put the entire liability of research on video. At the end of day, the video is to only introduce audience to Tax Harvesting as a concept. The details of the equities being held may differ for each person it is their responsibility to formulate the correct plan for themselves.

[@luhaarunk3085]

​@@ojas.rastogi Well guess what, I can. Because Zero1 by Zerodha makes pretty good videos, have done a lot towards educating the common people on a wide variety of topics. As such, what they say carries a pretty substantial weight because they have gained the trust of lots of people. So when they include the SIP exit and re-entry in their tax-harvesting video without mentioning the investment limits of certain SIPs, that is a glaring omission. Also, the speed with which they have been pushing / pumping out videos recently, this lapse of research was bound to happen sooner rather than later. They better get back to making sure future videos do not leave out critical information, or else they will also become just another finfluencer channel. To quote you, "the video is to only introduce audience to Tax Harvesting as a concept", then why to even watch their videos? Chat GPT, Google etc. can pretty much introduce anyone to any concept. Zero1 doesn't just introduce to the concept, they go into detail in a very to-the-point, precise, short and accurate level like no other channel.

[@akumpawatjr]

​@@ojas.rastogito be fair, they could have added such earnings and points in the checklist.

[@sibasankarbadatya7936]

Is zerodha going to add tax harvesting this feature in coin and kite app😮

[@YogeshMarwaha]

A small comment on the example, one need not to sell all units (amounting to 5L) at once, you can do it in smaller transactions of 1L each.

[@ssyoagesh]

In my opinion, don't over complicate things by doing tax harvesting. just invest, follow-up the investments, redeem when needed and pay the TAX! Keep it simple. That's it.

[@funbegins2371]

one needs to have some decent moolah for doing this, not worth it for the middle class to do this.

[@ganeshpai8095]

Ek dum sahi baat bro

[@ShubhamThakkarShubhavatar]

Asli ID se aao nirmala

[@nomeshg]

​@@ShubhamThakkarShubhavatar nice comment

[@Rahulkr3004]

​@@ShubhamThakkarShubhavatar🤣🤣 Nice one

[@RajveerSingh-vf7pr]

loss harvesting. even if some share shows loss, but you are hopeful that this share is the one i want to hold, (or some different share you wanna buy) you can set off the long term capital loss against LTCG, to further reduce your taxable gains.

[@thesaimonkabir]

It's only useful when you invest small amount, not for big one. But great video topic 😊

[@nomeshg]

Small amount is very controversial. For earning around 1.25 lakh each year to save tax invested amount needs to be 12.5lakhs done at 12% per anum. This might not be small amount for many.

[@mrakshith6801]

Great insights, what is the buffer time given to re invest though? Is it like sell and then place back a buy order at the same instance?

[@tradingtraveller05]

Explained Tax Harvesting so nicely. Thanks guys and keep up the good work.

[@Zero1byZerodha]

Thank you 🙌

[@SHIVAMPANDEY-pi4vy]

DONT SELL AND PURCHASE ON SAME DAY IT WILL BE CONSIDERED AS INTRADAY TRANSACTION AND WILL BE TAXED AS PER TAX SLAB . SELL TODAY AND THEN BUY TOMORROW THEN IT WILL BE CONSIDERED AS NORMAL EQUITY TRANSACTION

[@santhoshmoolemane]

Exit load and expense ratio left the chat

[@codedusting]

The expense ratio is built in NAV units if I am correct. It's not a post sell thing or during a sell thing. Exit load is 0 in long term if I remember.

[@gauravsudarshan1533]

Doesn't matter much. Very little impact

[@SaneBharatiya]

Absolutely spot on with Exit load. If you are SIP investing, Exit load with eat a major chunk of your returns, if you redeem your investment within 1 year, just so your returns don't cross the 1.25L limit. I have experienced it myself while tax harvesting my investment....

[@NirmalKumar-sc5tk]

@@SaneBharatiya Please watch the video again. He is saying to sell after 1 year. So exit load for most mutual funds will be 0. If you sell before 1 year, you will have to pay STGC without benefit of tax harvesting any way.

[@insanesandy6157]

Thank you team, for the excellent video and its insightful screenplay and production quality-it was truly commendable. However, it seems there are still many doubts and queries among viewers regarding the topic. It would be greatly appreciated if all comments and concerns could be addressed comprehensively in a detailed follow-up video, delving into all aspects of tax harvesting, as it is indeed a somewhat complex subject.

[@SHAMIKII]

Love the scenery outside the office.

[@AdilHusain]

How does this tax harvesting show In the tax filing? Will it just show units I sold or also show the ones which I purchased? As far as I know it shows the ones which are sold only. Is it only applicable for mutual funds or stocks as well? What if I sell one fund and invest in another, will it still be applicable?

[@ojas.rastogi]

@AdilHusain Tax liabilities are only on holdings sold, hence only those are shown. It's applicable to both MFs and Stocks. But for Stocks, make sure you buy the stock the next day and not the same day, otherwise it is seen as an intraday trade and not eligible for long term gains harvesting. It does not matter which fund you buy later.

[@ninadwrites]

Awesome stuff man! You guys have actually disrupted the finfluencer space with such great content, I simply can't stop binging around

[@Smithh9hz]

Even if you sell after & reinvest in the same day. The NAV would have increased over the year. So you will be buying units at higher NAV & this may affect compounding isnt it ?

[@sridharans2230]

They clarified this in the video - In stock market, compounding is nothing but staying invested. For example, let's say you bought 10 units of shares last year where 1 unit's price was 5 rupees. So 10 units would've been 50 rupees. This year, unit's price has gone up from 5 rupees to 15 rupees, so now the value of those 10 units would be 150 rupees. Now you redeem those 10 units worth 150 rupees and you re-invest the same day, you'll still get 10 units for 150 rupees because unit's price is not going to change on the same day. Even if you did not redeem it, the price of 1 unit would've been 15 rupees. Hope this clarifies!

[@DEIPRAVEEN4794]

However, the Profit/CAGR in the account will be "shown" as revised/reduced, but effectively there is no change in the compounding.

[@harieshmk6346]

just in case, if there is not enough money in my bank account (equivalent to the withdrawn amount), there is nothing wrong in waiting two or three days until that amount hits our bank account right? I mean, as long as i am OK with the share/ NAV going up/down on those three days... If i missed something, correct me please?

[@rickiodious]

That's correct

[@amlanacharjee]

Actually that's not so simple, maybe 2% down today can cost you lakhs tomorrow coz the lost amount today will also get compounded.

[@normalchannel2185]

I mean, its risky, but yes you can do that. And obv you lose out on the growth of those 2 days

[@normalchannel2185]

​ @amlanacharjee Not how it works. Let us math it out Let us take 1L invested at 10% growth rate. 100 stocks at 1000INR each For 2 years First year: 1.1L Now Case 1: You reinvest instantly and basically have no change. Stock price would be at 1100INR. You buy back 100 stocks again. 2nd year: 1.21L Case2: You sold and invested 2 days later. The stock price would be at 1100INR when you sold. You got 1.1L money In those 2 days, let us say the stock price went to 1101INR . You can now only buy 99 Stocks. You are left with 1001 rupees. Now, you can either put in 99 more rupees(this is what you lost in those 2 days) or you can let it go.

[@vira781]

I believe you can do this with large cap funds. you shouldn't do this with small cap as they are more volatile

[@prashunpcchakraborty70]

What about STT & other taxes which are levied on both entry & exit

[@scorpio_gamer]

Could you also talk about STPs, about how to use it effectively?

[@Zero1byZerodha]

Hey, thanks for reaching out! Passing this on to the team :)

[@aachuu5]

Is it good for gold Mutual funds???

[@Pankaj1205]

Is it possible to plugins this calculator on kite app and app will suggest through genai.

[@sandeeprana8708]

Please make separate episode on tax harvesting for sip investers

[@vm7240]

Can someone explain what's the point of doing all these if you're not going to exit the market? I mean, rather than doing all these heraferi, isn't it better to just stay put? Does this apply to only those who wants to change their investments (say from stock A to stock B)?

[@shikamaruuzumaki-ov2zd]

you didn't understood his point ig , he is using the cap on ltcg which is 1.25 lakhs where you dont have to pay taxes , so by just realizing your gain by selling after one year your ltcg gain will be exempted till 1.25 lakhs . For you other question he specificaaly said you need to reinvest to be in the market

[@jhonnyblazez]

Ya ur right, this will also help let's say u wanna shift to diff MF or stock in few years, which many ppl might do.

[@saurabhkesharwani6143]

@vm7240 you are right!

[@BadarinathGopalakrishna]

is it possible to sell the first investment of the year selectively? i dont see that option in coin. maybe it can be added for the non AMC-SIP opters

[@Shubham_Toshniwal]

8:03 Every video is incomplete without the checklist mini story!😂😂👌

[@Zero1byZerodha]

Glad you feel that way!😉

[@TechSavant-d3i]

We would require to buy the MF 2 days prior to sell date as it takes 2 days to process the order ?

[@soumyadeepmitra3680]

If you buy and sell before 1 PM, you will get same day NAV for both units sold and units purchased.

[@srikanthkambham7]

Don't portray farming as an inferior profession

[@sanketvaria9734]

ok but jo paisa mai earn karunga as profit to uspe income tax bhi to lagega right?

[@AnikitSahni]

This is fine for initial years but as the corpus grows say in year 6-7 .. It might not be really practical to have that amount in liquid to actually sell all and buy that big an amount while waiting for the sells to settle in the bank in 2-4 days time. Is there no better and practical way to do this ?

[@RohitSurw]

You just need to sell enough stocks/MFs that you would realize around 1.2l profit. No need to sell everything.

[@sahil47]

​​@@RohitSurw you will need the money someday for consumption. Why else are you investing? To die with 10 cr in bank? I hope not and then you will end up paying the tax for the same amount /profit from your initial amount. This is delaying tax , that's all

[@ramchandraroopahome7107]

How do we know which. Nav we're selling. I can't find it in paytm money app

[@abhinavm9685]

Okay.. so you have mentioned about LTCG tax. How about the income tax? If i say pull out the money say 10 lakhs (profit+capital) from my mutual fund... it reflects in my income tax p&L right? If my salary is say 10 Lakhs.. my net profit income for that financial year becomes 20 lakhs. So won't it mean jump to a higher tax slab.. or paying more tax in the same tax slab? (Best case) Please note that I am new to tax.. kindly advise if my understanding is right...

[@TheMuniappan]

How to particularly pick units which are brought 1 year ago. Do we have any such option.

[@saurabhsingh6325]

just find no. of units which are over 1 year and sell that much units only

[@yatvik6641]

I have a doubt ..! What about Expense ratio ? Every year once we sell we need to pay write.. !?

[@saurabh1605_sg]

Should I do this once a year or every month (i.e. selling SIP/stocks every month with age>12 months) to reduce the repurchase amount burden on my account?

[@chandankumaryadav5669]

Very good ❤

[@रूहदारहिंदोस्ता]

Good show boss ❤❤❤

[@Zero1byZerodha]

Thank you!

[@ketkiambulkar9394]

Thank you for the video. Can you make videos on investment on children's education and marriage

[@ranjithtouchriver]

Can I rebalance my portfolio this way? I have mutual fund investments in regular plans with a conventional broker, and I want to sell those and immediately reinvest the proceeds in direct plans, either through a discount broker or directly with the fund house. Could you advise if this is possible?

[@GauravArya-t5h]

Hi, but will it not be counted as an intraday rather than stcg/ltcg if we buy immediately same day?

[@ManojKumar-zg6tt]

No, the mutual funds you purchase are for delivery, not intraday.

[@GauravArya-t5h]

@@ManojKumar-zg6tt yeah but I have seen this behaviour from exchanges at least for stocks...even if you make it for delivery but buy the same day. It gets converted to intraday .in the trading journal. Not sure how mutual funds are treated.

[@johnsonrajendran5706]

Its not necessary to buy back the units on the same day because even if you back back the same units after 1-2 days, generally the NAV doesn’t change drastically within such short duration and the difference is negligible compared to buying on the same day over a long term investment

[@vigneshramanathan6108]

2:27 Question 2 Let’s say I sell a stock and reinvest in another stock does it considered as tax harvesting? Can I get some more detail on how we do tax harvesting like sell on one asset MF and reinvest in FD or on the Same instrument ?

[@prasanjeetgupta9360]

Yes, you can enjoy tax harvesting, but your money won't compound in that particular stock

[@shobhalvenkatesha2727]

Expense ratio?

[@satyakiguha415]

Went over my head....I don't have that much liquid cash to be able to sell everything and then buyback....plus most people would confuse and mix up everything in this process...also how can we keep track of units more than one year old। Vs units less than one year old if u have been making multiple investment s over many years in varying amounts in the same fund?

[@dsouzaleo]

The broker portal or the AMC website will provide the info regarding the age of the units. When you sell, the oldest units are sold first.

[@Mehulvaru]

If need to work it for ELSS, we have lockin of 3years?!

[@SatyamRaina]

Very informative, thank you

[@vineetkumar-tt8oi]

So that means i have to hassle on planing and timing the selling and reinvesting of my gains every month

[@Kukugmhg651]

For elss fund??

[@GoofyRecaps]

I have 10 crore to invest and wants to retire. Any suggestions where should I put this money? I'm single 22 year old and have decided to never marry or have any kids.

[@heyareyouokayy]

Yes donate it to poor people, like me

[@Kashiskthakur]

what about smallcase SIPs ??

[@yashjain3839]

Is this exemption bucketised under Section 80C?

[@amruthcharank1152]

No, the funds covered under section 80, can't be sold under 3 years

[@amiirshad]

❤ da content.

[@benjamin7576]

In case of SIP, after completion of 1yr, if we don't have liquid cash , wait for 2 days, reinvest the credited amount, will I fall in short term tax or tax can be harvested?

[@karthikeyanarumugam5222]

let's say I have 2k HDfC shares. And i dont want to invest in any other shares. After a year, If i sell all the 2k shares and then buy the same share again in the next day, will it still help in tax harvesting? I heard somewhere that repurchasing the same stock will not help. Please clarify

[@Zero1byZerodha]

No, it doesn’t matter if you sell and then repurchase the same stock. As long as you’ve realized capital gains, tax harvesting still works. Just make sure the stocks you’re selling have been held for at least one year to qualify for long-term capital gains benefits.

[@karthikeyanarumugam5222]

@@Zero1byZerodha thank you for your reply. I didnt expect a reply. Thanks for clarifying my doubt as well. 😊

[@nageshmaiya2845]

But this is only for mutual fund investment?

[@pabitranaskar5967]

Brokerage fee is also a factor, so harvest only when near the the 1.25L threshold

[@anankochhar]

In calculator add point 3 details (to know the losses on load on taxes)

[@MohanPrasathSJ]

Can we use SWP and SIP on a single day to automate this? 😅

[@padmakard7]

As i understand this, corporate actions like stock split, bonus & dividends will be negatively affected as the quantity of stocks will reduce after each sell-buy cycle Let me know if this is correct

[@pskarthic]

As in video example, I would need to pay tax at end of 10 years when I realise the gain right?

[@ojas.rastogi]

That may or may not be the case. As explained in the video, the linear 12 pa growth yields the tax liabilities towards the end of 10 years. But incase the market is slow during the time, you may not need to pay taxes, as the gains maybe under the limit. Another thing to consider would the change in the tax structure itself. Maybe the limit 10 years from now has increased...

[@RajeshAllem8256]

Nice video on tax harvesting in which you compared a 10yr investment and withdraw lumpsum and instead of that you showed every year withdrawal. What is your view if someone has already completed over a decade of investments. How can they use this strategy? can you throw some light on it.

[@SVM2165]

Withdraw 1+ year units which have up to 1.25L gains & get benefit on them. For units not part of this! Pay tax when you withdraw.

[@normalchannel2185]

Start withdrawing 1.25L per year. Then reinvesting. Basically legal moneylaundering. Turn your decade of invested money into one year long money. Lets say you have 125L (or 1.25Cr) invested. Take out 1.25L per year and reinvest that. That money then gets reduced from your taxable gains

[@MrSumedh12]

Should selling and buying be happening strictly the same day before 3pm? What’s the effect if it is reinvested just within couple of days?

[@adityajain5238]

Price might increase or go down, no other risk/effect

[@MrSumedh12]

@@adityajain5238 cool thanks!

[@MrSumedh12]

@@adityajain5238 cool thanks!

[@normalchannel2185]

@@adityajain5238 And slight loss of growth on stocks

[@chaurasia_dk]

If I sell some stock today and immediately buy it, I think it's then considered as intraday trading and taxation is totally different for intraday, right? It will not be considered in LTCG/STCG. Please explain!

[@shubhamqweasd]

if you buy as long term and sell immediately/same day, its not considered as intra day trading. You need to pay full margins upfront.

[@akshay86523]

No, this would not be considered intraday trading. Intraday trading refers to buying and selling a stock within the same trading day. In this case, you're first selling a stock that you’ve held for more than a year, and then immediately buying it again. This transaction would be considered a fresh acquisition, not intraday. "Buy and Sell on the same day" → Intraday "Sell and Buy" (assuming you’re repurchasing a stock you sold after holding for a year) → Not Intraday

[@RohitSurw]

Intraday would be considered for buy and sell, not sell and buy, right? Also Shubham's point is valid.

[@utkarshdeepak]

Intraday would be considered irrespective of buy first or selling first.. If buying and selling is done on the same day for stock then it is considered as intraday. I have personally thought that it would not be considered as a intraday and ended up paying intraday charges.. So if you want to tax harvest stock then sell today(T) and buy tomorrow(T+1).

[@chaurasia_dk]

@@RohitSurw my assumption was also similar to what you guys are saying and tried tax harvesting in March this year but it didn't work I checked with customer support and they told same as my comment. I have experienced it hence tried to confirm again

[@arulbangalore3470]

Won't sell and buy same day be counted as intra day, which is speculative business income instead of LTCG or STCG ? Can you please clarify?

[@ojas.rastogi]

Correct, that is the case for stocks only though. For MFs it is not considered as an intraday trade.

[@sagarsharma3346]

Will it be applicable even if we withdraw from a fund and reinvest on same day in a different fund?

[@ojas.rastogi]

Yes

[@nasifhashmi3252]

But we will not be exiting without any reason right , if we want the money for some emergency then we can't reinvest immediately right?

[@investingmantra6076]

This was very nice explanation

[@Zero1byZerodha]

❤

[@issu264]

in the case of SIP's u complete the SIP for 2 years, then sell the units been held for a year, and repeat it every year by selling the total units of one year.

[@bhaveshverma302]

can you explain how to sell units held in last year in your case, since investment apps don't show date of units alloted while redeeming. there is option to enter units while redeeming.

[@issu264]

@@bhaveshverma302 u just note it down while purchasing, ik it may be hard, but make it a habit. :) , create a excel sheet and note it.

[@bhagyamadhav6840]

excellent

[@bharathgopalakrishnan3739]

From office to farm. Eager to see what else you guys will cook up for the next videos 😀

[@youtuber08495]

Kuvera give the Tax Harvesting option directly, no need to worry about keeping track of units

[@prasoonrastogi940]

We do not normally get same day NAV even if we invest in MF before 3 pm

[@pavankuriseti7966]

We do get I did several times when I bought before 12

[@Seilesh7]

How long can I wait before buying bank again !? Should i be doing it before 3pm same day / week / month / before financial year ends?

[@ojas.rastogi]

Buying back does not have a time expiry. You can buy back whenever since the transaction loop of buying and selling certain units is complete. In ideal scenario, the units should be bought same day to get the same NAV so that no value is lost due to the market movement.

[@vineetharyan6974]

Can tax harvesting be done with NIFTYBEES? Because as soon as we sell it, the amount will be in our Zerodha account. And if we buy immediately, does it count as repurchase?

[@maanasasathi2483]

What about the transaction charges for buying and selling? That should also be calculated..we might end up losing more than what we pay up in form of taxes!! 😅

[@vinaykumar00731]

What about charges of selling and buying , change in the expense ratio of a mutual fund, we have to keep that in mind too

[@JammUtkarsh]

I think this is a little complicated. Also, can you make a video about how we can combine this with ELSS Funds

[@ojas.rastogi]

With elss, it becomes a 3 year cycle. That's all

[@ehtramali1767]

5:49 what is redemption NAV?

[@vigneshramanathan6108]

@@ehtramali1767 when you buy the nav would be for example ₹50 but after 5 yrs or so the Mutual fund would have gained some value and current nav would be ₹70 and if you sell now it is you redemption nav ₹70

[@foxysatisfying675]

You are wrong, instead of tax tou should calculate the amount after tax in your hand. In tax harvesting you have less amount after the 10 years.

[@Abhay-vk9uq]

is this better than just simply doing sips for say 15 years?

[@mitrajisitaramaprakki5173]

'Much ado about nothing'. No doubt it is an interesting piece of advice. For someone who has, say 50lakhs or 1cr will the exercise be worth the effort? ay

[@abhijeet7153]

How to do that under which head of tax law it's done 80C 80CCD not made clear. Repeatedly telling what to do Need some hint on how to do it.

[@adithyak100]

My question is when you exit after holding it for a year and then buy it again won't the average buying price increase?? Which further effect compounding?? And also the risk of you buying it at a higher price and say there's a correction in the market due to which you face losses??

[@ojas.rastogi]

If you buy back in a short period. Say for mutual funds the same day or even a day or two later, there is a high probability that the prices remain in ball park. In case of Stocks, you need to buy it a day later so that the trade is not considered intraday trade which is taxed as a speculative business. Yes, the average buy price will increase, but the compounding nature doesn't change. It's merely the display number that will be changing next to the holding. But the actual compounding is still happening on the basic investment in year 0. And incase of a sudden crash in market where you are in losses, you don't have any ltcg to save, ap why would you sell it? In such case though, tax harvesting with booking losses can be done incase there are any stcg or ltcg. This will decrease tax liability.

[@adithyak100]

​@@ojas.rastogi in case of stocks let's say I buy a stock "X" for Rs 100 and after a year let's say the stocks is at Rs 175 and has the potential to touch 500+ in the coming year's. But here I sell it at Rs 175 and then buy it the next day say at Rs 176. So won't my % of return reduce when it goes from Rs 176 to Rs 500 than from Rs 100 to Rs 500??

[@thegreatantz]

This is just too painful. Specially the part where you need to have that much amount in acount. Too much of hassle.

[@viveksethi3256]

Do a tax calculation on swp of both long term, short term, tax harvesting also on both equity mf sip or lumpsum and debt mf swp with taxation

[@Prinjal_Boruah]

what about exit load?

[@YashKakrecha]

1% is still less than 12.5%. and some MF even have 0.04% exit load.

[@amlanacharjee]

​@@YashKakrecha not necessarily. Exit load is 1% of turnover , not of profit. Whereas 12.5 % is of profit. There's a big difference

[@gurmannatsingh486]

@@YashKakrecha Am I cooked if my first thought on reading MF was not mutual fund but ...?

[@pawansahani3892]

Exit load mostly applies only if you redeem it before 1 or 2 year . Mostly 1 year

[@ojas.rastogi]

Usually Exit load is applicable for a much shorter period than 1 year. Ofc, check your fund's documents

[@tkdevlop]

Which mutual funds keep track of this tax stuff?

[@dsouzaleo]

Zerodha provides the Tax harvesting options on its kite console.

[@atulkgadekar]

I asked this questions to many but nobody answered me, hope to get answer from you. Question: I'm salaried person having income only from salary and then I do tax harvesting by selling my mutual funds (Applicalbe for LTCG) in any FY less than 1.25 lakh so while filing ITR, do I need to file ITR2 and mention above realised profit or not and File ITR1 as anyways I need to pay 0 LTCG tax. Please answer my question.. Thanks.

[@NitinMarwal]

I believe its ITR2 to declare your MF sale and purchase transactions .. and if you do intraday in stocks then you have to file ITR3

[@captainvane104]

You need to file ITR 2 and mention 1.25 L as capital gains.

[@dr.mangeshpise1825]

If Sell investment and buy it immediately, it wont be considered as tax harvesting move. It will be considered as intraday trade. You won't get the benefit of tax harvesting. Can we buy the same stock after the settlement of sold stock?

[@ScorpIon-956]

I have tried this on Zerodha. I had sold & rebought some units on the same day. But it still showed as "Unrealized Gains". So, I think for Tax Harvesting, we have to Sell today & Re-Buy tomorrow.

[@aniganguly]

Smallcase does a quarterly rebalance ( sell/buy same day)... Will the gains realized here fall into tax harvesting logic? Also aren't units sold in FIFO system by default (let's say on Zerodha)?

[@ojas.rastogi]

(a) Not all smallcases rebalance quarterly and definitely not for tax harvesting (b) Assuming your smallcase does that each quarter, the gains/loss would be stcg, so would not fall in ltcg exemption being talked about here.

[@aniganguly]

@@ojas.rastogi makes sense. Thanks for clarifying. Let's assume that the small case rebalance does happen every quarter, shouldn't after four quarters all that is sold be coming under LTCG... Still unsure if they follow FIFO while selling but incase they do, I think 5th qtr onwards it should be part of LTCG assuming that the first lot is still existing and not exhausted by previous rebalance! Appreciate inputs.

[@ankitroy4874]

So if I am doing an sip or even lumsum investing every other month in a mutual fund/etf/stock , I am putting the money in the same product(stock/mf/etf). So does the broker keep track of how many units I had before an year. Because I may put my money in on. Dec24' and do this harvesting on Jan25.

[@somakroy]

Yes, all brokers keep a track of buy/sell statement, you can get the exact purchase dates from there.

[@compiled.7641]

Buying same day would be considered as Speculative income??

[@nirmalkumarselvaraj3996]

It is not clear how it saves for me for example: I am selling stocks worth 10 lak and buying again stock worth 10 lak for that I would have stayed invested right? why should I do this in the first place? please explain

[@somakroy]

For stocks you have to sell it as delivery, intraday trading will not help in tax harvesting.

[@nirmalkumarselvaraj3996]

@@kasim7929 Anyhow, on the final resale, I need to pay the tax, right? So how does it reduce my tax? The tax I need to pay for this year is zero in both cases, right?

[@Joseph_rocky]

This works for small portfolio, what if your portfolio is 50 lakh rupees or 1 cr?

[@VishNuTejaG]

Did you missed exit load & expense ratio in MF? Selling & Buying will take some cost.

[@Zero1byZerodha]

Hi Vishnu, thanks for reaching out! If you sell mutual funds after a year, there’s usually no exit load. The expense ratio is charged daily and is already included in the NAV, so it doesn’t add extra cost when you buy or sell. But frequent buying and selling can still have some costs, like exit load (if sold early) or transaction fees.

[@RamaRajeshOfficial]

In case of SIP, why do you want to sell every month after an year? You may use SWP to withdraw funds for the future needs and in this way, you are not only saving tax but you will stay invested as well. SIP for investing and SWP for withdrawing can save tax much easier than this process. I really love all your videos, every video is well researched and simplified for the audience but why did you complicate the process in this video especially for SIP?

[@abhinavm9685]

I think it becomes really tedious during tax filings!