Stamp duty on mutual funds is a government levy of 0.005% on the amount you invest, deducted before units are allotted.
Since 1 July 2020, every purchase of mutual fund units carries stamp duty of 0.005% of the amount invested. The fund house deducts it from your payment and allots units for the rest.
For example, on a ₹1 lakh purchase, the stamp duty is ₹5. Units are allotted for ₹99,995 at the day's NAV.
It applies to:
It does not apply to redemptions. Transfers of units between demat accounts carry a separate stamp duty.
Because it is charged once, on the way in, stamp duty is a very small cost next to the yearly expense ratio. On a SIP of ₹10,000 a month, it comes to ₹6 a year.
Stamp duty is set by the government, so it is the same at every fund house and for every plan.
Each fund page has its returns, risk, costs, managers and everything it holds.