Costs, Tax & Regulation
SEBI (Mutual Funds) Regulations, 2026
What changed for investors from 1 April 2026.
Updated 27 September 2026 · SEBI rules as of 2026
Approved
17 December 2025
Costs, Tax & RegulationOverview
SEBI’s board approved new Mutual Funds Regulations on 17 December 2025, replacing the 1996 regulations; they took effect on 1 April 2026 with an updated Master Circular. The rewrite simplifies the rulebook and lowers cost caps.
| Particular | Details |
|---|---|
| Approved | 17 December 2025 |
| Effective | 1 April 2026 |
| Replaces | SEBI (Mutual Funds) Regulations, 1996 |
| Expense caps | Base Expense Ratio excluding statutory levies |
| Brokerage cap | 6 bps (cash), 2 bps (derivatives) |
Key changes
- Statutory levies (GST, STT, stamp duty, SEBI & exchange fees) charged on actuals, outside expense caps
- Lower BER caps — e.g. index funds/ETFs 0.90%, closed-end equity 1.00%, other FoFs 1.85%
- Removal of the extra 5 bps expense allowed for schemes with exit loads
- Brokerage caps cut to 6 bps (cash) and 2 bps (derivatives)
- Specialised Investment Funds and MF Lite recognised within the framework
- Regulations shortened from 162 to 88 pages
Impact on investors
Lower costs
Especially for index funds, ETFs and FoFs.
More transparency
Clear split between fund costs and taxes.
Same safeguards
Trustee oversight and disclosure rules continue.
Frequently asked questions
Will my fund’s expense ratio fall?
Many funds’ base costs fall; the statutory levies are shown separately.
Mutual fund investments are subject to market risks; read all scheme-related documents carefully. Information is educational and may change with SEBI / tax rules — verify with the AMC, AMFI or SEBI. FinancePortal is not an investment adviser.