Top 10 ELSS tax-saving mutual funds have earned 32% return in 3 years; benefits of investing in these MFs

economictimes.indiatimes.com:

Do keep in mind that the section 80C benefit is only available for those opting for the old tax regime.

Also read: Tax-saving guide for FY 2023-24

While taxpayers should plan their tax-saving investments throughout the fiscal year, many individuals tend to become more proactive in the Jan-Feb-March months, when the financial year-end is approaching.

According to a recent Times of India news report, between April 2022 and Jan 2024 — during the first nine months of each fiscal — ELSS recorded an average monthly net outflow of Rs 77 crore. In comparison, the corresponding figure for Jan-Feb-March in the same years jumped to Rs 917 crore, the Times of India news report quoted the data released by the Association of Mutual Funds in India (AMFI).

What is ELSS

As per the AMFI website: «Equity-Linked Savings Scheme (ELSS) is an equity mutual fund investment that invests at least 80 per cent of its assets in equity and equity-related instruments. ELSS can be open-ended or close ended. Investments in an ELSS qualify for tax deductions under Section 80C of the Income Tax Act within the overall limit of Rs 1.5 lakh. The amount you invest in ELSS is deducted from your taxable income, which helps you lower the amount of income tax you are liable to pay. Investments in ELSS are subject to a three-year lock-in period.»

According to investment managers and financial advisers, on several counts, ELSS floated by fund houses are the best tax saving options.

Also read: How to invest in tax-saving ELSS mutual funds online

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