New Delhi, Sept. 8 -- If you are investing in mutual funds, you may be getting a hidden tax benefit that you might not be aware of. It is related to the tax on dividends-a tax that mutual fund investors do not have to pay directly.

But if you invest in stocks and receive dividend income, the tax on it can go up to 30%, depending on your tax slab.

Here's what investors need to know about the dividend tax advantage in mutual funds.

Nilesh D Naik, Head of Mutual Funds at PhonePe, said, "For resident Indians, dividends from stocks are taxed at the applicable personal income tax slab rate".

Sougata Basu, Founder and CEO, CashRich, added that dividends have been taxed in the hands of investors since April 2020, after the dividend distributi...