Income Tax: Deadline to seek tax exemption via ELSS is tomorrow, not March 31. Here's why

livemint.com:

tax saving instruments is March 31. This is common knowledge but not many are aware that the last date to invest in Equity Linked Savings Instruments (ELSS) is tomorrow i.e., the last date when the markets are open. The financial markets are closed on Friday on account of Good Friday.

Following that, the markets are closed on the weekend. Since the financial markets are closed for three days, mutual fund houses will not be able to process the transactions during these days. The only transaction, however, which can happen on the weekend is the debit of money from your bank account while no mutual fund units will be transferred to your account before Monday.

“To be on the safe side, it is advisable to invest at least 2-3 working days before the expiry of the financial year. This is meant to ensure that the entire transaction comes to a completion before March 31. So, merely making payment on the last date is nothing we generally advise the investors," says Ravi Saraogi, Co-founder, Samasthiti Advisors.

ALSO READ: Does paying law firm in Dubai attract TDS? Sridharan Sundaram, founder of Wealth Ladder Direct, echoes the same sentiments. “The last date to invest in ELSS in order to claim tax exemption is tomorrow if the fund realisation happens tomorrow. If someone, say, makes the payment in the first half of the day, the fund realisation will happen the same day, and the investor – in such a case—will be entitled to claim the tax exemption." However, if you want to invest in any non-equity financial instrument such as NPS, PPF or insurance, one can very well do it on an off day since online transactions can take place on the weekend as well.