TaxTMI 
TaxTMI 
Question - What are the proposed in Finance Bill 2015 to facilitate consolidation of schemes of mutual funds ?
Tax neutrality on merger of similar schemes of Mutual Funds
28 Feb 2015 
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Tax neutrality for mutual fund scheme mergers preserves cost basis and holding period for capital gains computation post-consolidation.
Tax neutrality is proposed for consolidation of similar mutual fund schemes where consolidation involves all equity oriented schemes or all non-equity schemes; the cost of acquisition of consolidated units will be the cost of units in the consolidating schemes and the holding period of consolidated units will include the holding periods of consolidating units, preserving continuity for capital gains computation. The proposal defines consolidating and consolidated schemes in relation to the regulatory merger process and is to take effect from 1st April, 2016. (AI Summary)
Tax neutrality is proposed for consolidation of similar mutual fund schemes where consolidation involves all equity oriented schemes or all non-equity schemes; the cost of acquisition of consolidated units will be the cost of units in the consolidating schemes and the holding period of consolidated units will include the holding periods of consolidating units, preserving continuity for capital gains computation. The proposal defines consolidating and consolidated schemes in relation to the regulatory merger process and is to take effect from 1st April, 2016. (AI Summary)