Investors who conclude that investing primarily in equity markets will lead to higher taxes on their returns is often a misconception. Therefore, to avail from tax benefits, they invest in many fixed income schemes. An investor can choose an LSS scheme to counter this common misconception. ELLS is a great investment option to get the dual benefits of tax savings and wealth creation. Therefore, a part of your investment portfolio should be the best ELSS fund.
Equity Linked Saving Scheme (ELSS) is a diversified, open-ended equity scheme provided by mutual fund houses in India. Under this scheme, a tax benefit is available under Section 80C of the Income Tax Act, 1961. Not only do ELSS mutual fund schemes become the most common savings option, but they also double as a viable form of the investment offering an attractive return. It is possible to invest in ELSS mutual funds using SIP (Systematic Investment Plan) and provide a lump sum investment option. There is a lock-in period of 3 years and more liquidity as compared to other solutions like the National Savings Scheme and Public Provident Fund.
Many industry experts consider ELSS mutual funds as one of the best tools for tax savings. Because such investments increase a certain amount of risk, it is good to know some good ELSS mutual funds in which you can invest.
Axis Long Term Equity Fund – The aim of investment — primarily to generate income and long-term capital appreciation from a diverse portfolio of equity and equity-related securities. However, there can be no guarantee that the investment target of the scheme will be achieved.
Appropriate for long-term capital appreciation and income generation.
Reliance Tax Saver Fund – Investment Objective: The main goal of the scheme is to generate long term capital appreciation from a portfolio that is primarily invested in equity and equity-related instruments. However, there can be no guarantee that the project’s investment target will be achieved.
Suitable for: Origin of long term wealth and tax benefits.
Aditya Birla SL Tax Relief 96 – Purpose of Investment – The objective of the investment is to save tax by increasing the money by investing in equity.
Investment in equity and equity-related securities, subject to tax benefit under section 80C,
DSP BR Tax Saver Fund – The scheme’s main investment goal is to produce moderate capital appreciation from a diversified portfolio composed primarily of corporate equity and equity-related securities and enable investors to take advantage of the deduction from total income, as permitted from time to time under the Income Tax Act, 1961.
Appropriate for – Capital appreciation.
Franklin India Taxshield Fund – The main objective of Franklin India Taxshield is to provide income tax exemption as well as moderate long-term capital growth.
Appropriate for – Long term capital appreciation.
Tata Tax Savings Fund – Purpose of Investment – to provide income distribution and medium for long-term capital gains, emphasizing the importance of capital gains at all times.
Appropriate for – Long term capital appreciation.
IDFC Tax Advantage ELSS Fund – Investment Goal – The objective of the investment is to achieve long-term capital growth primarily from a diversified portfolio of equity-related securities.
Income tax benefit, primarily in equities and Equity-related securities, is suitable for investments with U / S 80C and 3-year lock-in.
ICICI Pru Long Term Equity-Tax Svng-DP-G – Investment goal- An equity-linked savings scheme which is primarily intended to appreciation long-term capital by investing in equities and related securities and providing tax benefits u/s 80C of the Income Tax Act, 1961.
Suitable for – Long term solution for wealth creation