Transmission takes place after the death of an investor, where the mutual fund (MF) units held by the deceased unitholder are transferred to the nominee(s) or the legal heir(s). At the time of transmission, no tax is involved.
“Transmission of mutual fund units refers to transmission of units to the nominee and/or the surviving unitholders after the death of the unitholder. It is pertinent to note that the term ‘transfer’ is different from ‘transmission’ and accordingly, transmission of units to the nominee would not attract any capital gains tax as it does not result in any transfer u/s 2(47) of the Income Tax Act, 1961,” said Dr. Suresh Surana, Founder, RSM India.
