Why Invest in ELSS Mutual Funds?
  • Save up to Rs. 46,350* on taxes
  • Experience high investment in long term
  • Lowest lock-in period among 80C instruments
  • Best for last minute tax savings
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Top funds 3Y Return 5Y Return
Axis Long Term Equity Fund (G) 10.32% 12.89% Invest
ICICI Prudential Long Term Equity Fund (Tax Saving) (G) 6.27% 8.56% Invest
Aditya Birla Sun Life Tax Relief 96 (G) 7.23% 11.69% Invest
L&T Tax Advantage Fund (G) 7.54% 9.91% Invest
Mirae Asset Tax Saver Fund (G) 13.93% - Invest
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Mar 27, 2019 5 min read

Only 2 Days Left to Save Up to Rs. 46,800* on Taxes!!! Invest in ELSS Now

Know how to save maximum tax with ELSS even in such a short time

ELSS, also known as Equity Linked Savings Scheme is a category of equity mutual funds, by investing in which investors can enjoy dual benefits of high growth from equity instruments and tax deductions on investments of up to Rs. 1.5 lakh. These schemes fall u/s 80C which allows them to provide tax saving benefits to investors. These schemes have a lock-in of just 3 years, which is lowest among all the 80C instruments. Now, let’s take a look at how you can save tax from ELSS optimally.

How to Invest in ELSS Optimally?

Mr. Rameshwar, age 29, is a Software Engineer in an IT company with an annual salary of Rs. 5,00,000. Now, with this income the tax will be calculated at a rate of 20%, but after he makes an investment of Rs. 1.5 lakh, the tax liability will be calculated on an amount of Rs. 3.5 lakhs and will be calculated at a rate of 5% and the tax liability will decrease greatly.

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Now, if you fall in the highest tax bracket then it is even better for you as you will be able to save tax of up to Rs. 46,800*. Let’s take a look at how you can save this amount with the help of a detailed calculation.

In the below table the income tax liability is calculated on an annual income of Rs. 12 lakh, The first table will show you the tax liability before any kind of investments are made, and in the second table you will see that how by investing in ELSS, a sum of Rs. 46,800 can be saved.

Tax Liability Before Making an Investment
DescriptionIncomeIncome Tax
Exempt Income Rs. 2,50,000  
Income chargeable at 5% Rs. 2,50,000 Rs. 12,500
Income chargeable at 20% Rs. 5,00,000 Rs. 1,00,000
Income chargeable at 30% Rs. 2,00,000 Rs. 60,000
Relief u/s 87 A 0
Income Tax after relief u/s 87 A Rs. 1,72,500
Surcharge 0
Education Cess Rs. 6,900
Secondary & higher education Cess  
Total Tax Liability Rs. 1,79,400
Tax Liability After Making an Investment of Rs. 1.5 lakh
Tax Summary
DescriptionIncomeIncome Tax
Exempt Income Rs. 2,50,000  
Income chargeable at 5% Rs. 2,50,000 Rs. 12,500
Income chargeable at 20% Rs. 5,00,000 Rs. 1,00,000
Income chargeable at 30% Rs. 50,000 Rs. 15,000
Relief u/s 87 A 0
Income Tax after relief u/s 87 A Rs. 1,27,500
Surcharge 0
Education Cess Rs. 5,100
Secondary & higher education Cess  
Total Tax Liability Rs. 1,32,600

So, with the help of the above tables, you can see that before making any kind of investments in the ELSS, the total tax liability on the annual income of Rs. 12 lakh is Rs. 1,79,400, and after making the investment of Rs. 1.5 lakh the tax liability came down to Rs. 1,32,600, which is a difference of Rs. 46,800. Now, after you know how you can save tax, let’s move to the top ELSS funds in which you can invest to take the most from your investments.

Top ELSS Funds

Scheme NameAUM (As on Feb 28, 2019)Returns (As on Mar 26, 2019)
3 Years5 Years7 Years
Aditya Birla Sun Life Tax Relief 96' Fund (G) Rs. 7,561 crore 14.66% 18.37% 17.90%
Axis Long Term Equity Fund (G) Rs. 17,426 crore 13.96% 17.95% 19.67%
ICICI Prudential Long Term Equity Fund (G) Rs. 5,614 crore 13.39% 15.41% 15.82%
Mirae Asset Tax Saver Fund (G) Rs. 1,381 crore 21.66% - -
L&T Tax Advantage Fund (G) Rs. 3,074 crore 13.86% 15.13% 14.35%

Now, one important point to remember is that unlike market cap or sector oriented schemes, ELSS funds are not bound to a particular approach. So, before you select one from the above list make sure that you carry out a detailed analysis of the fund, and then choose one that perfectly fits with your investment style.

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  • Lowest lock-in period of 3 years
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Hope by reading the above write up you got the idea that how ELSS can help you in saving taxes even within such a short time period. In case you are not sure which scheme is best for you, or have any other query about ELSS funds, feel free to connect with the experts.

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