Investing in mutual funds is becoming more popular in our country because it has given good returns in recent years.
However, it’s important to know that you need to pay taxes on the money you earn from mutual funds.
There is one type of mutual fund called Equity Linked Savings Scheme (ELSS) where you don’t have to pay taxes on the money you invest.
ELSS is considered a good choice among different mutual fund options. The money you invest in ELSS is put into the stock market.
ELSS allows you to save taxes up to Rs 1.50 lakh under Section 80C of the Income Tax Act.
Some ELSS funds have also provided good returns in the last 3 years, which is why it’s known as a tax-saving mutual fund scheme.
ELSS also gives you tax benefits on long-term profits up to Rs 1 lakh.
What’s great about ELSS is that it has a lock-in period of only 3 years, unlike other schemes such as NSC and tax-saving FD, which have a lock-in period of 5 years.
After the initial 3 years, you can continue with the Equity Linked Savings Scheme.
You can start investing in ELSS with just Rs 500. It gives you the flexibility to choose a scheme based on your budget and convenience.
There’s no limit on the maximum amount you can invest. According to experts, investing in ELSS for the long term can provide better returns.
Here are the top 5 ELSS Mutual Funds with their returns over the last 3 years
1) Quant ELSS Tax Saver Fund – 32.35 percent
2) HDFC ELSS Tax Saver Fund – 25.02 percent
3) Bandhan ELSS Tax Saver Fund – 24.94 percent
4) SBI Long Term Equity Fund – 24.71 percent
5) Bank of India ELSS Tax Saver Fund – 23.88 percent
