Snapshot - Tax rules for mutual funds January 2011

EQUITY ORIENTED SCHEMES

FINANCIAL YEAR 2010 - 11
Investors Tax for Short Term Tax for Long Term Dividend Dividend Distribution Tax Deducted at Source
Category Capital Gains # (STCG) Capital Gains # (LTCG) Income Tax (Payable by Scheme) [TDS] (Payable by Scheme)

Resident Individual / HUF* 15%^ Nil Tax Free Nil Nil

Resident Partnership
Firms / AOP / BOI * / 15%^ Nil Tax Free Nil Nil
Domestic Companies
STCG - 15%^
NRIs 15%^ Nil Tax Free Nil
LTCG - Nil^

NON EQUITY ORIENTED SCHEMES

FINANCIAL YEAR 2010 - 11
Dividend Dividend
Tax for Short Tax for Long Distribution Tax - Tax Deducted
Distribution Tax -
Investors Term Capital Term Capital Dividend Liquid / Money at Source [TDS]
Other than Liquid /
Category Gains # Gains # Income Money Market Market Schemes (Payable by
(STCG) (LTCG) Schemes (Payable (Payable by Scheme)
by Scheme) Scheme)
Resident Individual / 13.840% 27.681% (25%
HUF* As per
10% (20% (12.50% plus plus 7.5%
personal
with Tax Free 7.5% surcharge surcharge plus Nil
Income Tax
Indexation plus 3% 3% education
structure slab
education cess) cess)
Resident Partnership 22.145% 27.681% (25%
Firms / AOP / BOI * / 10% (20% (20% plus plus 7.5%
Domestic Companies 30% with Tax Free 7.5% surcharge surcharge plus Nil
Indexation plus 3% 3% education
education cess) cess)
NRIs 13.840% 27.681% (25%
As per
10% (20% (12.50% plus plus 7.5%
personal STCG - 15%^
Tax Free
with 7.5% surcharge surcharge plus
Income Tax LTCG - Nil^
Indexation plus 3% 3% education
structure slab
education cess) cess)
*Hindu Undivided Family (HUF), Body of Individuals (BOI) and Association of Person (AOP). ^ Plus applicable surcharge, if any, and education
cess and secondary and higher education cess. # LTCG : Units held for more than 12 months, STCG : Units held for 12 months or less.
PERSONAL INCOME TAX STRUCTURE
Total Income Tax Rates
Up to INR 160,000 (a)(b) NIL
INR 160,001 to INR 500,000 10%
INR 500,001 to INR 800,000 20%
INR 800,001 and above (c) 30%
(a) In the case of a resident woman below the age of 65 years, the basic exemption limit is ` 190,000.
(b) In the case of a resident individual of the age of 65 years or above, the basic exemption limit is ` 240,000.
(c) Surcharge is not applicable.
(d) Education cess is applicable at 3 per cent on income tax.
Disclaimer
This information is being provided for basic guidance for investments in mutual funds and is based on provisions of the Finance Act 2010. The tax implication may vary for each
assessee based on the details of his / her income. All rates and figures appearing here are for illustrative purposes only. Tax benefits are subject to change in tax laws. Contents of this
note have been drawn for informative purpose only and the same should not be used or considered as an investment/tax advice. Each investor is advised to consult his/her own tax
consultant with respect to specific tax implications arising out of their participation in the scheme. The AMC/Trustee/Sponsor accepts no liability whatsoever for any direct or
consequential loss arising from any information provided in this note.
Statutory Details: HSBC Mutual Fund has been set up as a trust by HSBC Securities and Capital Markets (India) Private Limited (liability restricted to the corpus of ` 1 lakh). The
Sponsor/associates of the Sponsor/Asset Management Company (AMC) are not responsible or liable for any loss or shortfall resulting from the operation of the Schemes. The
Trustees of HSBC Mutual Fund have appointed HSBC Asset Management (India) Private Limited as the Investment Manager.
Risk Factors: All investments in mutual funds and securities are subject to market risks and the Net Asset Value (NAV) of the schemes may go up or down depending on the factors and
forces affecting the securities markets. There can be no assurance that the objectives of the schemes will be achieved. Past performance of the Sponsor, AMC, Mutual Fund or any
associates of the Sponsor/AMC does not indicate the future performance of the schemes of the Mutual Fund. The names of the schemes and do not in any manner indicate the quality
of the schemes or their future prospects or returns. Please read the Scheme Information Document and Statement of Additional Information carefully before investing.
Copyright. HSBC Asset Management (India) Private Limited 2011, ALL RIGHTS RESERVED.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or
otherwise, without the prior written permission of HSBC Asset Management (India) Private Limited.