Tax savings through mutual funds: 5 ELSS that may fetch you good returns and great savings
Investing in ELSS not only reduces your tax liability but gives greater liquidity, lesser lock-in period, the option of investing using SIPs or in lumpsun and more.
- May 31, 2017,
- Updated Jun 2, 2017 1:56 PM IST
Equity-linked saving schemes, or ELSS, are open-ended (funds that have no restriction on number of shares issued) and diversified (a way of allocating capital in a variety of assets in a way that reduces exposure to risk thereby mitigating loss) schemes offered through mutual funds.
The unique feature of this scheme is that it offers tax benefits under the section 80C of the Income Tax Act, which means that you can reduce your tax liability.
"One can avail a maximum deduction of Rs. 1.5 lakhs invested into these funds from you income during a financial year . This in turn, would help in saving tax of upto Rs. 46,350/- (if you fall in the highest income slab) during a financial year. These funds are efficient tax saving investments with the least lock in period and a superior track record on performance," says Mayank Bhatnagar, Chief Operating Officer, FinEdge.
With large asset base of Rs 2,202 crore as on April 2017, this fund reaps 29.19 per cent in 1 year. In 3 years and 5 years, the scheme gives back 18.50 per cent and 19.93 per cent returns.
rated 3 stars by Value Research, it has a market capitalisation of Rs 29,701.78 crore.
This, too, has a diversified sectoral holding ranging between Financial, FMCG, Technology, Textiles, etc.
Equity-linked saving schemes, or ELSS, are open-ended (funds that have no restriction on number of shares issued) and diversified (a way of allocating capital in a variety of assets in a way that reduces exposure to risk thereby mitigating loss) schemes offered through mutual funds.
The unique feature of this scheme is that it offers tax benefits under the section 80C of the Income Tax Act, which means that you can reduce your tax liability.
"One can avail a maximum deduction of Rs. 1.5 lakhs invested into these funds from you income during a financial year . This in turn, would help in saving tax of upto Rs. 46,350/- (if you fall in the highest income slab) during a financial year. These funds are efficient tax saving investments with the least lock in period and a superior track record on performance," says Mayank Bhatnagar, Chief Operating Officer, FinEdge.
With large asset base of Rs 2,202 crore as on April 2017, this fund reaps 29.19 per cent in 1 year. In 3 years and 5 years, the scheme gives back 18.50 per cent and 19.93 per cent returns.
rated 3 stars by Value Research, it has a market capitalisation of Rs 29,701.78 crore.
This, too, has a diversified sectoral holding ranging between Financial, FMCG, Technology, Textiles, etc.