How to Withdraw SIP Amount from Mutual Funds?
11 Jun 2026
3 mins read
This article aims to help individuals understand the process of withdrawing their Systematic Investment Plan (SIP) money, a systematic strategy commonly used in mutual funds. SIPs allow individuals to invest a specific amount into a chosen mutual fund scheme on a regular basis, usually on a monthly or quarterly basis. It provides a comprehensive guide on how to withdraw SIP amount, which helps in taking control of the financial journey and accessing the assets immediately or preparing for significant milestones.
What is SIP Withdrawal?
SIP withdrawal is the process of withdrawing or claiming back the investment amount from a mutual fund through a Systematic Investment Plan (SIP). Upon SIP withdrawal, the units associated with your investment are sold, and the withdrawal amount is credited to your bank account.
Investors can withdraw SIP amount in two ways:
1. Withdrawal of the full amount by selling off all units
2. Withdrawal of part of the amount while keeping rest of the investment active
The withdrawal amount varies depending upon the Net Asset Value (NAV) of the mutual fund at the time of withdrawal. To estimate your returns and how your investment has grown over time, you can use the SIP calculator.
Table of Contents
How to Withdraw Money from Mutual Fund?
The process of withdrawals of mutual funds is easy and generally takes only a few minutes. Withdrawals can be made from a mutual fund either offline or online via the AMC, mutual fund application, or any investment website.
Steps to Withdraw SIP Amount Online
- Step 1: Log in to your mutual fund or investment app.
- Step 2: Go to the “Portfolio” or “Investments” section.
- Step 3: Select the mutual fund scheme you want to redeem.
- Step 4: Click on “Redeem” or “Withdraw.”
- Step 5: Enter the amount or number of units you want to withdraw.
- Step 6: Review the details carefully.
- Step 7: Submit the redemption request.
Once the request is processed, the amount is transferred to your linked bank account.
What does Redemption from Mutual Funds Mean?
The process of selling your investments is called withdrawal. Redeeming is the term for this procedure in mutual funds. In a mutual fund system, you are effectively redeeming units when you take money out. You realise the value of the units you possess when you sell them at the relevant Net Asset Value (NAV).
Consider the following scenario: you have invested in 1,000 units of a mutual fund scheme. You can withdraw a certain sum in currency terms or redeem or sell a specific number of units. Redeeming 500 units from your mutual fund holding would be necessary if you wanted to withdraw Rs. 5,000, assuming that each unit is worth Rs. 1. In a similar vein, you have the option to take money out of your mutual fund portfolio in the amount of 10 or 900 units that you redeem.
The process of selling your investments is called withdrawal, and in mutual funds, this is known as redemption. When you withdraw or redeem your SIP mutual fund amount, you’re essentially selling units at the current Net Asset Value (NAV). For example, if you hold 1,000 units and want to withdraw Rs. 5,000, you would redeem 500 units at Rs. 1 each. You can choose partial withdrawal from a mutual fund SIP or redeem all units for a full SIP withdrawal.
Types of Mutual Fund Redemptions
- Partial Withdrawal
You can withdraw a portion of your SIP investment while keeping the rest intact. For example, redeeming Rs. 50,000 worth of units from a Rs. 1 lakh portfolio. - Full Withdrawal
This is when you redeem all units in your mutual fund folio, close the scheme, and withdraw the entire amount including gains.
Methods to Withdraw SIP Amount
- Using a Broker or Distributor
If you invested through a broker, they can guide you through the SIP withdrawal process step by step, collecting details like your investment amount, scheme name, and folio number. - Directly from a Trading and Demat Account
Log in, select your SIP holding, and follow the how to withdraw money from SIP mutual fund process. Enter the amount, choose withdrawal options, and the funds will be credited to your bank. - Through an Asset Management Company (AMC)
Visit the AMC’s website or branch, fill out a SIP redemption form with the scheme name, folio number, and withdrawal amount, and submit it for processing. - Through Registrar and Transfer Agents (RTAs)
Contact RTAs for help with SIP withdrawal rules in India. Provide your folio number and scheme name, and they will guide you through the process.
SIP Withdrawal Time (How Long Does It Take?)
The SIP withdrawal time depends on the type of mutual fund scheme.
Here’s the usual SIP withdrawal time:
Mutual Fund Type | Withdrawal Time |
| Equity Mutual Funds | 2-3 working days |
| Debt Mutual Funds | 1-2 working days |
| Liquid Funds | Within 24 hours (in the majority of cases) |
The final credit timeline may differ depending on bank processing and market holidays.
To better understand when and how the redeemed amount is credited, the reader may consider understanding more about the funds payout process and what timeline payout takes.
Can I Withdraw Partial Amount from SIP?
Yes, most mutual fund companies permit partial withdrawals from SIP investments.
This implies that one can withdraw a specific portion of the money while retaining the rest of the investment. By doing so, the investor can take care of his immediate monetary requirements without interrupting his long-term investment plan.
But some plans may have a lock-in period or redemption restrictions.
For instance:
- In ELSS mutual funds, there is a lock-in period of three years
- Some plans may have a minimum redemption restriction
Charges & Tax on SIP Withdrawal
There can be some fees and taxes applicable to SIP redemptions based on the type of mutual fund and the duration for which it was held.
Exit Load Fee
An exit load fee is charged by some mutual funds when the units are redeemed within a certain period. This is normally a small percentage of the value being redeemed.
Capital Gains Taxes
Equity Mutual Funds
- STCG – taxed at 20% if redeemed within 1 year
- LTCG – taxed at 12.5% on gains exceeding ₹1.25 lakh after 1 year
Debt Mutual Funds
Taxes on capital gains generated through debt mutual funds are charged according to the income tax slabs of the investor.
Common Mistakes While Withdrawing SIP
The following are some mistakes that investors should not make while withdrawing SIPs:
- Withdrawal of investments too soon without financial planning
- Not considering the exit loads
- Failure to consider the taxes before redeeming the investments
- Redemption at the time of market volatility
- Avoiding wealth creation for the long run by investing in short-term expenditure
- Failure to consider the lock-in period in ELSS plans
When Should You Withdraw SIP Amount?
Under the conditions below, you may withdraw SIP amount::
- To meet your financial objectives, like purchasing a home or funding your education
- During emergency situations
- To rebalance your portfolio
- In case the mutual fund is consistently underperforming relative to the benchmark indices
- Upon meeting your long-term investment objective
Do not withdraw SIP investments just because the market fluctuates in the short term, as staying invested for the long run can yield better results. In addition, it might be necessary to keep abreast of overall SIP investment trends to know where investors are putting their money
Things to Keep in Mind While Withdrawing SIP Amount Online
- Tax Implications: Short-term and long-term capital gains tax applies depending on the fund type and holding period. Equity mutual funds have a 15% short-term tax, while debt funds have a 20% rate.
- Exit Load: Some schemes charge up to 1% if you withdraw before a set period.
- Processing Time & Lock-in Period: Processing usually takes 3–5 working days for open-ended schemes. ELSS and closed-ended funds have a lock-in period during which withdrawals aren’t allowed.
Conclusion
Knowing how to redeem SIP amount online or offline is key to managing your investments. Whether you opt for partial withdrawal from a mutual fund SIP or a full exit, ensure you understand tax rules, exit loads, and lock-in periods. A reliable investing platform can make the process smoother and faster.
FAQs on How to Withdraw SIP Amount from Mutual Funds
Is it Possible for Me to Withdraw Money From My Mutual Fund Investment Plan at Any Time?
On any working day, a redemption request may be submitted. It is always the investor's choice to sell all or part of their investment. Redeeming an investment usually happens when it reaches its goal or target.
How long does it take to get the money after the sell order is placed?
In most cases, the AMC will deposit money into your account three or four business days after receiving your redemption request.
When Is It Time to Cash Out My Mutual Funds?
Mutual fund units may be redeemed in line with individual investment goals and preferences. Investors should carefully consider their withdrawal choices before making a decision, since this might directly affect their capacity to generate higher returns.
Are withdrawals from SIPs taxable?
Refunds from mutual funds, including lump sum and SIP deposits, are taxable when redeemed. Whether the gains are categorised as long-term capital gains (LTCG) or short-term capital gains (STCG) determines the taxes. Whereas LTCG has distinct tax rates and exemptions depending on the type of mutual fund, STCG is charged at your income tax slab rate.
After a year, can I cancel my SIP?
Yes, after a year, you are able to withdraw your SIP. It will be subject to reduced implied taxes as it would be seen as a long-term capital gain.
Can I withdraw SIP amount anytime?
Yes, in open-ended mutual funds, you can redeem your SIP investment anytime, but in ELSS or lock-in schemes, you must wait for the lock-in period to end.
How can I withdraw SIP money online?
You can redeem units through your mutual fund’s website, mobile app, or investment platform by logging in and placing a withdrawal request.
Is there a penalty for SIP withdrawal?
Some funds may charge an exit load if you redeem before a specific holding period, while others allow free withdrawals.
Can I withdraw SIP partially or only the full amount?
You can choose to redeem a part of your investment or the full amount, depending on your needs.
How to withdraw SIP amount online?
If you wish to withdraw your SIP amount through the internet, follow these steps: First, login to your account of mutual funds or investments. Next, click on your portfolio and then choose your scheme or fund. Thereafter, click on the “redeem” button. After entering the amount you wish to withdraw, the transaction shall be completed.
How long does SIP withdrawal take?
Withdrawal of SIP generally takes:
- Equity funds: 2-3 working days
- Debt funds: 1-2 working days
- Liquid funds: Within 24 hours
However, the actual time may vary depending on the type of fund and how fast the banks process.
Can I withdraw SIP anytime?
Yes, you are free to withdraw your SIP at any point in time except when there is a lock-in period on the particular mutual fund. For instance, ELSS funds have a 3-year lock-in period where you cannot withdraw your investment.
How to withdraw money from mutual fund easily?
The simplest route would be through your investment app or via the AMC website. All you need to do is log in, navigate to your portfolio, choose the mutual fund in question, and make the withdrawal. It is quick, hassle-free, and usually accomplished in just a few clicks.
Is SIP withdrawal taxable?
SIP Withdrawal: Yes, SIP withdrawals are taxable depending on the kind of mutual fund and period of holding:
- Equity Fund SIPs:
- Short-Term (below 1 Year): 20% Tax
- Long-Term (above 1 Year): 12.5% on gains above ₹1.25 Lakh
