suren
41
Suppose i did sip 1000/month for 2 year in elss start date (10/4/2012) end date (10/3/2014) as elss is 3 year locking period when can i withdraw? i mean will it be start date + 3 year or end date + 3 year? can you please explain with above example when can i withdraw?
Can i withdraw before before 3 year. I mean it will be taxable income but can i ?
There is a lock in of 3 year for each payment/investment of the SIP. That means you can withdraw portion equivalent to 1000 INR in 10/4/12 on 10/4/15 (value would change at withdrawal time.
Withdrawing before lockin means the income becomes taxabale and you need to pay the tax + interest of delay of payment of tax.
Please note that some mutual funds wont let you withdraw before end of term.
so it means i can withdraw as following 1000 invested on 10/4/12 on 10/4/2015 1000 invested on 10/5/12 on 10/5/2015 1000 invested on 10/6/12 on 10/6/2015 and so on... please correct me if i am wrong..?
Yes correct (sorry about mistyping 1000 to 2000, edited the reply).
Also note that the 1000 invested on 10/4/12 will be of a different value (hopefully more) in 2015.
Just adding some more points to @mithun-dhali answer.
When you invest an amount every month, some units gets allotted to your account (called as folio in mutual fund terminology). So these much units would get locked for next three years.
Say, you bought 110 units for Rs 1000 in Jan 12, 90 in Feb 12 and 100 in Mar 12. Then 110 units would be available for redemption after Jan 15, total 200 after Feb 15 and all 300 after March 15.
These units won't be sell-able before three years. Mutual fund company would reject any redemption request.
