How Bharat ETF Bond is tax-efficient and when is it going to be launched?
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This bond is taxed like any other corporate debt fund or debt mutual funds. Any capital gain arising on sale of an investment that has been held for a period more than 3 years, shall be taxed at the rate of 20% and will be given indexation benefit. However, if you redeem your investment before 3 years, you have to pay tax as per your applicable tax slab.
Bharat ETF Bond is available for 2 different maturity periods: 3 years and 10 years, so you can plan your investment accordingly. This bond shall be open for trading on 12-December-2019 to 20-December-2019 with the base size of Rs.7,000 crores and will be traded only on the stock exchange, unlike mutual funds. The per-unit value of these bonds will be capped at Rs.1000.
For investors seeking to invest in funds that are both tax-efficient and risk-free, Bharat ETF Bond could be a great option. You can get access to these funds at a very low price and it will also have predictable tax-efficient returns due to a target maturity structure.
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