How-to MF switch intra-AMC

How to switch between mutual fund schemes (intra-AMC switch)

From WebNotes, a public knowledge base. Last updated 19 May 2026. Reading time ~5 min.

Key facts

What it is	Single transaction: redeem source, subscribe to target, same AMC
Tax treatment	Taxable event (deemed redemption + deemed subscription)
Exit load	Source scheme's exit load applies if within lock-in
Cross-AMC switch	Not possible directly; redeem then re-subscribe

A mutual fund switch moves your holdings from one scheme to another within the same AMC. It’s operationally simpler than separate redemption + subscription but tax-wise identical: both are deemed redemption of source units followed by deemed subscription to target.

Conflict-of-interest disclosure. This guide is published by WebNotes Editorial Team for informational purposes. WebNotes has no commercial relationship with any AMC or platform. No affiliate commission is earned. For complex tax situations, consult a Chartered Accountant.

Step-by-step procedure

See the procedure infobox above.

Switch vs redeem+resubscribe

Aspect	Switch	Redeem + Resubscribe
Transactions	Single	Two
Cash to bank	No (stays in AMC)	Yes (cash in transit)
NAV cut-off risk	One NAV applied; lower slippage	Two NAVs across days; gap risk
Tax	Same (taxable)	Same (taxable)
Operational	Simpler	More work
Cross-AMC	Not possible	Required path

For intra-AMC moves, switch is preferred.

Common switch scenarios

Scenario	Source	Target
Risk reduction near goal	Equity Hybrid	Conservative Hybrid or Debt
Performance disappointment	Underperforming scheme	Better-performing scheme same AMC
Direct vs Regular conversion	Regular plan	Direct plan
Goal reached (partial)	Equity scheme	Liquid for parking
Tax-loss harvesting	Loss-making scheme	Similar scheme to maintain exposure (with tax cost)

Tax mechanics

Per switch as a taxable event :

Source-scheme units: Treated as redeemed at NAV on switch date.
Capital gain = (NAV × units) - cost basis (FIFO).
Holding period: From original acquisition to switch date.
Target-scheme units: Treated as subscribed at switch-date NAV; fresh holding-period clock starts.

Equity LTCG (held > 12 months): 12.5% above Rs 1.25 lakh per Section 112A. Equity STCG (held < 12 months): 20% per Section 111A. Debt MF: slab rate (Section 50AA, Finance Act 2023).

Exit load consideration

If source scheme has exit load (e.g., 1% within 1 year):

Switch within 1 year = exit load applies.
Exit load deducted from source NAV; target allotted at fewer units.
After exit-load period, switch is “free” (no load).

Verify scheme’s load structure before switching.

External references

References

SEBI (Mutual Funds) Regulations, 1996.
Income Tax Act, 1961, Sections 47, 48, 112A, 111A, 50AA.
SEBI Master Circular for Mutual Funds (applicable NAV cut-off, exit load).
AMFI Best Practice Guidelines on scheme switches.

Reviewed and published by

WebNotes Editorial Team

The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

Last reviewed: 19 May 2026
Conflicts of interest: WebNotes is independent. No relationship with any broker, registrar or bank named in this article.