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No, Liquid funds return is not tax-free. Liquid funds are debt funds and one need to pay short term (Less than 3 years of investment) or long term (Above 3 Yrs of investment) tax.
The short team capital gain - Short team gains are added to the income and taxed at the income tax slab applicable to the investor.
The long team gain - calculated when the investment is done for more than 3 years; LTCP is 20% with indexation benefit.
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Are liquid funds taxable? Are liquid funds taxable in India? Are liquid fund returns taxable? Is liquid fund interest taxable? Is liquid fund dividend taxable? How are liquid funds taxed?