I am NRI having mutual funds subscription and holding (of rupees one crore) under regular plan.Today for the first time I saw the NSDL statement showing distributor’s commission,which happens to be a large amount. Can you suggest me some way whereby I can change the present regular plans to direct plan, without spoiling my relationship with my MF agent. Can I stop the subscription now and change to direct plan after 1 yr to avoid taxation?
Can I stop the subscription of mutual funds online and can I write to banks also not to release the SIP amount?
If you feel that the income he is generating from your investment is so valuable compared to the value addition he is giving to your investment, then simply switch off to DIRECT funds.
First thing you have to keep in mind is that adviser not giving value addition, then don’t bother about what he feel if you switch to DIRECT. Because it is your money. You have all rights to reduce the cost. However, if he is providing the valuable service, then you can continue.
If you decided to switch, then you have to first request for cancel SIPs. Once they get cancelled, then using the same folio numbers, you can start a fresh in direct funds. You can use respective mutual fund companies portals or MF Utility for this. Once the units in regular funds completes a year (in case of equity funds), then request for units to move from regular to direct. Same way apply to debt funds. Remember, moving from regular to direct is considered as redeemption from funds and investing in funds. Read below post for complete taxation issue of MF in below post.
I am really thankful to you for the prompt response.
Wishing all of you a very happy Diwali.
Right now I am residing in Middle East.can I stop SIP of various mutual funds online ,without visiting their offices in person?