Tax harvesting – A way to save taxes on your capital gains!

How to reduce long term capital gains tax
The strategy which reduces your tax which is applicable to your Mutual fund’s long term capital gains is called tax harvesting. So what is tax harvesting and how it is applicable in reducing tax
To understand tax harvesting first have to understand how long term capital gain is taxed.
In 2018 Long term capital gain are reintroduced on equities
According to Rule In a financial year, More than 1 Lakh capital gain is taxed 10%
Therefore if you want to pay less tax or not to pay tax, You should ensure than your capital gain should not build up or cross the tax-free limit and that’s what called Tax harvesting all about
Tax Harvesting is a strategy in which you try to sell your mutual fund investments to book long term capital gain and reinvest in same mutual fund.

Published by Nidhi Mehra

I am blogger with 5 years of experience in writing articles and topics related to finance and funds

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