Regular to Direct Mutual Fund Switch Cost Calculator

How it works

A Regular plan and a Direct plan of the same fund hold the same stocks and have the same fund manager. The Regular plan charges a higher expense ratio because it pays a commission to the distributor who sold it to you. Moving to the Direct plan stops that, but the switch is a redemption, so it can cost capital gains tax and an exit load today.

When you pick a fund, the calculator reads three things from Foliyo's mutual fund data (Morningstar):

• Both plans' expense ratios. These are fixed by the fund, so you can't change them here.
• The Regular plan's return over the last 5 years (3 for younger funds). It is the starting point for the expected return, which you can change.
• The exit load, read from the fund's own terms: the percentage and how long it applies, and whether the fund waives it on a switch from Regular to Direct.

You add what your Regular plan is worth today, roughly when you invested, and (if you know it) what you put in. The calculator then follows your money down two paths over the next 10 years, valuing each the way you would actually receive it: after exit load and tax, if you sold everything that year.

• Switch to Direct today: sell the Regular plan, pay any exit load and tax, and invest what's left in the Direct plan, which earns the same return plus the expense ratio gap.
• Stay in Regular: keep the Regular plan and its higher expense ratio.

The break-even year is the year from which the Direct path leaves you with more in every year up to year 10. Most of the tax paid on switching is tax you would pay anyway when you eventually sell the Regular plan; switching only brings it forward. So the real cost is the growth lost on that tax money, and active equity funds, where the gap is often 0.6% to 1.2% a year, usually win it back within a year or two.

Assumptions and limits

• Equity-taxed funds only. The search lists Regular Growth plans of equity funds, aggressive hybrid and equity savings funds. Tax is 20% on short-term gains (units held 12 months or less) and 12.5% on long-term gains above the ₹1.25 lakh yearly exemption, each plus 4% cess, for units sold on or after 23 July 2024. Surcharge is not included. Debt and most other hybrid funds are taxed at your slab rate and aren't covered.
• The ₹1.25 lakh exemption is assumed unused. Untick the box if you've already used it on other sales this financial year.
• One lump sum. Your holding is treated as one purchase in the period you choose. With a SIP, older instalments are long-term and recent ones may be short-term; check the capital gains statement from CAMS or KFintech before switching.
• A steady return. Real returns vary from year to year, and past returns don't predict future ones. The difference between the plans depends mostly on the expense ratio gap, so it holds up better than the totals do.
• Exit loads as written. Where the fund's wording can't be read, 1% is assumed on units under a year. A free allowance (for example, the first 10% of units) is ignored, so the cost shown is the most you'd pay.
• No set-off of losses. If you are sitting on a loss, a switch realises it, and that loss can be set off against other gains. The calculator doesn't count that.

Worked example: Invesco India Small Cap Fund

Say you hold ₹10 lakh in the Regular plan of Invesco India Small Cap Fund, bought more than 2 years ago. Its Regular plan costs 1.84% a year and its Direct plan 0.63%, so you pay 1.21% a year extra: about ₹12,100 this year. Over the last 5 years the Regular plan returned 16.52% a year; at that rate, you invested about ₹6.32 lakh.

• Cost to switch today: ₹31,590. The gain is ₹3.68 lakh. With this year's ₹1.25 lakh tax-free allowance unused, the rest is taxed at 12.5% plus 4% cess. There is no exit load on units this old.
• Pays for itself: in year 1. From then on, selling the Direct plan would leave you with more than selling the Regular plan.
• After 10 years: ₹3.40 L more in your hand if you switch today, after exit load and tax: ₹44.52 L against ₹41.12 L.

If you sell in	Switched to Direct	Stayed in Regular	Difference
Year 1	₹11.34 L	₹11.12 L	+₹21,904
Year 3	₹15.17 L	₹14.75 L	+₹42,211
Year 5	₹20.48 L	₹19.67 L	+₹80,634
Year 10	₹44.52 L	₹41.12 L	+₹3.40 L

Figures use the fund's expense ratios as of August 2026 and its returns to 30 October 2026. The calculator above refreshes them when the page loads.

Frequently asked questions

Is switching from a Regular to a Direct plan taxable?

Yes. A switch sells the Regular plan's units and buys the Direct plan's, so capital gains tax applies. For equity funds that is 12.5% on long-term gains above ₹1.25 lakh a year (units held more than 12 months) or 20% on short-term gains, plus 4% cess.

Is there an exit load on a switch from Regular to Direct?

It depends on the fund. Most equity funds charge an exit load, often 1%, only on units sold within a set period, commonly 1 year. Some fund houses waive it on a switch from Regular to Direct in the same scheme. The calculator reads each fund's terms and applies the load only where it does.

When does switching from Regular to Direct pay for itself?

For most active equity funds, within a year or two, because the Direct plan costs 0.6% to 1.2% a year less and most of the tax would be paid anyway when you sell. For index funds the gap is often 0.1% to 0.3%, so a switch can take more than 10 years to pay back.

Should I switch all my units at once?

Not always. Units held for a year or less pay 20% tax and often an exit load, so it can pay to switch them once they turn a year old. Splitting a large switch across financial years uses the ₹1.25 lakh exemption more than once. Tax-saving (ELSS) units can't be switched until their 3-year lock-in ends. New SIPs can go into the Direct plan right away.

Does switching change my fund, folio or SIP?

The fund, its manager and its holdings stay the same; only the plan changes. The units are sold and new Direct plan units are bought, usually in the same folio. A running SIP in the Regular plan doesn't move by itself: stop it and start a new SIP in the Direct plan.

Where do the numbers in this calculator come from?

Expense ratios, past returns and exit loads come from Foliyo's mutual fund data (Morningstar), updated as funds publish them. The tax rules are those of the Income-tax Act for units sold from 23 July 2024. The result is an estimate for planning, not investment advice.

Read next

• Direct vs Regular calculator: both plans' past returns compared
• Direct vs Regular mutual funds: the guide
• How to switch from Regular to Direct
• The tax cost of switching
• Expense ratios explained
• Find out who earns commission on your funds

This is an estimate for planning, not investment advice. Returns are not guaranteed.