MoneyKraft

1. DDT for a liquid fund is ___.

2. A mutual fund posts _______ return in the dividend option as compared to return in the growth option after taking dividend distribution tax into account.

higher

Equal

lower

3. Which of the following funds is "Not" subject to dividend distribution tax?

ABC Government Securities Fund

PQR Liquid Fund

XYZ Equity Fund

4. Dividend distribution tax impacts post tax return of the investor ___________.

in the dividend option of a debt fund

in an equity oriented fund

in the growth option of a debt fund

5. Hiren falls in the 20% tax paying bracket. He wants to invest in a monthly income plan. Which option should he choose to reduce his post tax return?

Dividend

Post tax return will remain unchanged

Growth

Why do debt funds attract a dividend distribution tax?

dividend distribution tax or ddt on mutual fund dividends

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Level - 6,3,8,6 BASIC

The dividend distribution tax payable by debt funds reduces returns to investors. Given this tax, watch this investor education video by Moneykraft to understand how investors should choose between the growth and dividend options of a debt fund.

AUTHOR(s):Uma Shashikant

Why do debt funds attract a dividend distribution tax?

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