UTI Nifty Next 50 Index Fund: Costs, Risks and Capital-Gains Tax on Units for Tax Year 2026-27

This article sets out the main features, costs and risks of the UTI Nifty Next 50 Index Fund and explains how gains on redemption of its units are taxed for Tax Year 2026-27 under the Income-tax Act, 2025.

Advisers are increasingly asked whether a low-cost index fund holding the next tier of large companies suits a client's portfolio, and how a redemption, a switch or a long-running SIP will show up in the return. The answers turn on scheme data that changes every month and on a tax regime that applies from 1 April 2026, so each point below should be checked against current disclosures before a transaction is advised.

Question 1: What is the scheme and how is it run?

UTI Nifty Next 50 Index Fund is an open-ended equity index fund of UTI Mutual Fund, launched on 28 June 2018. Its benchmark is the Nifty Next 50 Total Return Index (TRI). The fund manager named for the scheme is Sharwan Kumar Goyal. SIP, SWP and STP facilities are available, and the minimum investment is Rs 1,000.

The index consists of 50 companies drawn from the Nifty 100 after the Nifty 50 constituents are excluded, subject to the index provider's methodology and periodic rebalancing. The scheme follows the index and does not select stocks on its own view. Portfolio changes arise from index rebalancing, corporate actions, subscriptions and redemptions, and operational needs.

Figures as at 31 August 2026:

• Month-end AUM: Rs 7,546.56 crore.
• Monthly average AUM: Rs 7,516.97 crore.

These numbers change each month and should not be quoted to a client without refreshing them from the latest factsheet.

Question 2: What does the scheme cost, and which plan should the client hold?

The total expense ratio (TER) as at 31 August 2026 is 0.42% p.a. for the Direct Plan and 0.87% p.a. for the Regular Plan. The exit load is nil. TER can change within regulatory limits.