ELSS Funds

Equity Linked Saving Scheme (ELSS) is a tax saver mutual fund that enables investors to save tax with the lowest lock-in period among tax-saving investments. You can invest in these funds to generate wealth and earn a stable income for your long-term financial goals.

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Higher returns than other tax-saving options

Higher returns than other tax-saving options

Tax deductions up to Rs. 1,50,000 per year

Tax deductions up to Rs. 1,50,000 per year

Portfolio diversification

Portfolio diversification

Lock-in period of 3 years

Lock-in period of 3 years

List of Best ELSS Tax Saver Funds

    Fund Categories
    ICICI Prudential Asset Management Company LimitedHDFC Asset Management Co LtdSBI Funds Management LtdKotak Mahindra Asset Management Co LtdNippon Life India Asset Management LtdAditya Birla Sun Life AMC LtdAxis Asset Management Company LimitedUTI Asset Management Co LtdMirae Asset Investment Managers (India) Private LimitedDSP Asset Managers Private LimitedTata Asset Management LimitedBandhan Asset Management Company LimitedDSP Investment Managers Private LimitedHSBC Asset Management(India)Private LtdIDFC Asset Management Company LimitedCanara Robeco Asset Management Co. Ltd.Franklin Templeton Asst Mgmt(IND)Pvt LtdEdelweiss Asset Management LimitedInvesco Asset Management (India) Private LtdQuant Money Managers LimitedMirae Asset Mutual FundPPFAS Asset Management Pvt. LtdSundaram Asset Management Company LtdMirae Asset Global Inv (India) Pvt. LtdMotilal Oswal Asset Management Co. LtdBaroda BNP Paribas Asset Management India Pvt. Ltd.LIC Mutual Fund Asset Management LimitedDaiwa Asset Mgmt. (India) Pvt. Ltd.PGIM India Asset Management Private LimitedMahindra Manulife Investment Management Pvt. Ltd.Fund PineBridge Mutual FundJM Financial Asset Management LimitedUnion Asset Management Co. Pvt. Ltd.Baroda Asset Management India LimitedPrincipal Asset Management Private LimitedJPMorgan Asset Management India Pvt. LtdEdelweiss Mutual FundBajaj Finserv Asset Management LimitedWhiteOak Capital Asset Management Limited360 ONE Asset Management LimitedBank of India Investment Managers Private LimitedITI Asset Management LimitedNJ Asset Management Private LimitedNavi AMC LimitedICICI Prudential Asset Mgmt.Company LimitedFranklin Templeton Asset ManagementIDBI Asset Management LimitedQuantum Asset Management Co Pvt. Ltd.Samco Asset Management Pvt LtdHelios Capital Asset Management (India) Private LimitedGroww Asset Management Ltd.Trust Asset Management Private LimitedTaurus Asset Management Company LimitedShriram Asset Management Co LtdZerodha Asset Management Private LimitedOld Bridge Asset Management Private LimitedING Investment Mgnt (India) Private Ltd.Baroda BNP Paribas Mutual Fund
    Risk
    Tax Saver Mutual Funds SIP Calculator
    Calculate SIP returns based on past data
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    Disclaimer : Projections/estimations is backtested using historical data

    What are ELSS Tax Saver Funds?

    In this category of mutual funds, 80% of your investments will go to equity and its related instruments. And to offer your additional benefits, this fund category comes with a lock-in period of three years. When you opt-in for this investment category, you become eligible for deductions under Section 80C of the Income Tax Act.

    Benefits of Investing in ELSS Funds with INDmoney

    There are some benefits of investing in ELSS funds; we have mapped them below:

    • Tax Benefits

      Save up to Rs. 1.5 lakh per financial year, under long-term capital gains (LTCG) from ELSS funds. You can lower your taxable income by making a mutual fund investment thanks to tax deductions offered under Section 80C of the Income Tax Act, 1961. 

    • Potential for Higher Returns

      ELSS funds primarily invest in equities, which have historically delivered relatively better returns compared to traditional tax-saving options like PPFs or FDs. The long-term growth potential of ELSS funds is substantial, especially when held over the long term.

    • Systematic Investment Plan (SIP)

      You can invest in ELSS funds through SIP, which allows them to invest a fixed amount of money at regular intervals, helping to average out the cost of investment and mitigate market volatility.

    Tax Relaxations with ELSS Funds

    You will have tax benefits when you file your ITR at the end of the financial year, just because you have ELSS funds in your investment portfolio, know how:

     

    • When you are an ELSS investor, you can deduct up to Rs 1.5 lakh in taxes under Section 80C of the Income Tax Act of 1961. This can result in a maximum tax savings of up to Rs 46,800 annually.
    • ELSS fund gains are taxed as long-term capital gains because withdrawals are permitted only after a three-year lock-in period. These gains are taxed at 10% for long-term capital gains, with profits under Rs 1 lakh exempt.

     

    LTCG in ELSS Funds

    Long-term capital gains (LTCG) in ELSS (Equity Linked Savings Scheme) funds refer to the profits earned from the sale of equity-oriented mutual fund units held for one year or more. The LTCG tax is applicable on gains exceeding Rs. 1 lakh in a financial year, and the rate of taxation is 10%.

    Suppose Arun invested Rs. 5 lakh in an ELSS mutual fund scheme on May 3, 2018. On June 4, 2021, he redeemed all the units at Rs. 8 lakh. During the 3-year lock-in period, his investment generated a profit of Rs. 3 lakh.

     

    StepCalculationResult
    1. Calculate the profitRs. 8,00,000 - Rs. 5,00,000 = Rs. 3,00,000Rs. 3,00,000
    2. Calculate the LTCGRs. 3,00,000 - Rs. 1,00,000 = Rs. 2,00,000Rs. 2,00,000
    3. Calculate the LTCG taxRs. 2,00,000 x 10% = Rs. 20,000Rs. 20,000

     

    In this example, Arun has to pay a long-term capital gains tax of Rs. 20,000 (10% of Rs. 2,00,000) on the LTCG from his ELSS investment.

    How to Invest in ELSS Funds with INDmoney

    Investing in ELSS Tax Saver mutual funds with INDmoney. Here are the steps to follow:

    • Step 1

      Download the INDmoney app and create your free investment account by completing your KYC ( Know Your Customer).

    • Step 2

      Once your Free investment account is ready, you can either search for ELSS Mutual Funds or go to the mutual fund section and tap on Tax Saver under the collection section.

    • Step 3

      Choose a ELSS Mutual Fund by looking at aspects like past returns, volatility, downside capture ratio, AUMExpense ratios and underlying stocks and sectors.

    • Step 4

      You can choose to set up SIP in ELSS Mutual Funds or even invest as lumpSum. Once you are on the individual ELSS Mutual Funds page click from the bottom “One-time” for lump sum investment or “SIP” for systematic investment plan. 

    • Step 5

      Choose the amount that you want to invest as SIP or LumpSum.

    • Step 6

      Set up payments. If you choose to set up SIP in ELSS Mutual Funds,  you can do a free automatic pay set up via bank mandate or UPI. If you choose to invest in lumpsum (one-time) then you can pay via UPI, netbanking, NEFT or RTGS.

    Frequently Asked Questions

    This mutual fund helps you save taxes by locking your investment amount for a minimum of three years.

    Yes, your ELSS funds will be taxed at 10% if your profit exceeds Rs. 1 lakh.

    There is no cap on your ELSS investment amount, but the tax benefits are available up to Rs. 1.5 lakh under Section 80C of the Income Tax Act, 1961. 

    Yes, ELSS funds are high-risk investments and come with the potential for high returns, as 80% of your investment goes into equity-related instruments.

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