New Delhi, May 19 -- India's tax laws under the Income Tax Act, 1961, define how mutual fund investments by non-resident Indians (NRIs) are taxed.

oriented mutual funds, NRIs are subject to a 20% tax on short-term capital gains (STCG) and a 12.5% tax on long-term capital gains (LTCG). The taxation is different for debt mutual funds purchased on or after 1 April 2024, which are always considered short-term in nature and taxed according to the investor's applicable income slab rate.

For other categories of mutual funds, STCG is taxed at the investor's slab rate, while LTCG is taxed at a flat rate of 12.5%. If debt mutual funds were acquired before the 1 April 2024 threshold, the gains are taxed under the same STCG and LTCG framework as ot...