Before talking about which is the best ELSS scheme first we have to understand what is ELSS, So ELSS is Equity Linked Savings Scheme and it is a mutual fund which has majority of its fund invested in equities, also known as stocks. Equity linked means the returns of this scheme are linked to stock markets. It is called a savings scheme because it provides tax savings. ELSS is a type of expanded equity mutual fund which is capable for tax exemption under section 80C of the Income Tax Act and offers the undistinguishable advantage of capital appreciation and tax benefits. It comes with a lock-in period of 3 years and the investor can claim up to 1.5 lakh for the tax profit u/s 80 C. ELSS funds are the one of the best ways to save tax under Section 80C and this is because end to end with the tax deduction, the investor also gets the possible upside of investing in the equity markets. Also, no tax is charged on the long-term capital gains from these funds. Furthermore, compared to other tax saving options, ELSS has the nonstop lock-in period of three years.
So now we can talk about best ELSS Scheme. If you want to save your hard earned money from tax cuts and want higher returns so you can invest in these top – 10 ELSS funds which are mentioned in the given chart:
|Fund Name||1 Year Returns||3 Year Returns||5 Year Returns||Net Assets
( Rs. Crore)
|Tata India Tax Savings Fund||9.89%||15.32%||16.53%||1,770|
|Axis Long Term Equity Fund||7.43%||15.21%||17.03%||18,852|
|Kotak Tax Saver||13.41%||15.82%||15.47%||888|
|ICICI Prudential Long Term Equity Fund||10.72%||13.91%||12.12%||1,992|
|IDFC Tax Advantage Fund||1.95%||15.74%||15.10%||6,193|
|Invesco India Tax Plan||5.06%||14.59%||15.67%||835|
|Aditya Birla Sun Life Tax Relief 96||1.19%||13.55%||15.75%||8,599|
|Franklin India Taxshield Fund||3.59%||10.75%||13.73%||4,025|
|L&T Tax Advantage Fund||-0.16%||13.20%||12.42%||3,338|
|DSP Tax Saver Fund||9.44%||14.74%||14.20%||5,413|
Who should invest in ELSS Funds?
Since an ELSS is a market-linked investment instrument, it is an epitome tax-saving option for people looking for potentially high returns and who are ready to undertake quite a high level of risk. However, over the long-term periods of 5 years and more, an ELSS investment is capable of not only generating wealth for you but also of increase in value it at a rising pace.People who are risk averse and who do not wish to remain invested in an ELSS for a longer duration, can invest their money in relatively safer tax-saving investment instruments like fixed deposits and Public Well-prepared Fund.
What is mutual funds income tax exemption?
Tax-Exempt Funds. Mutual funds invested in government or municipal bonds, are often referred to as tax-free or tax-exempt funds because the interest made by these bonds is not subject to income tax. … Yet, not all bonds are exempt from all taxes.