Tax Saving Mutual Funds

Mutual Funds are very popular nowadays and Tax Saving Funds are one of them. These are also called ELSS funds. Investing in a Mutual Fund is the best solution to invest the money for getting high returns. The best benefits of Mutual funds are that these give high returns compared to other traditional modes.

Tax Saving Mutual Funds
Tax Saving Mutual Funds

What Are The Tax Saving Mutual Funds?

Tax Saving Mutual funds are the same funds as other funds. But the difference is that these funds allow you to save some money from the 80C act of the Indian government. Most of the Tax Saving funds are ELSS schemes and make investment in the growth investment market.

An Equity Linked Saving Schemes(ELSS) is an open-ended equity mutual fund that invests primary in equities and equity related products. They are special category among mutual funds that qualify for tax deductions under section 80C of the income Tax Act, 1961.

Benefits of Tax Saving MF?

There are no much more differences between the Tax saving and other funds. But there are some Tax benefits under the rule of the Indian government act 80C.

An ELLS is an Equity linked saving scheme, that allows an individual or HUF a deduction from total income of up to Rs. 1,50,000/- under Sex 80C of Income Tac act 1961. If an investor was to invest Rs. 50,000/- in an ELSS scheme, then this amount would be deducted from the total taxable income, thus reducing her tax burden.

  • An investor who is looking to invest for at least 3 years,
  • Who want benefits for income text apart from getting high return,
  • Short and Long term capital gains,

High Return ELSS Funds

Annualised Historical Return Table Of Tax Saving Mutual Funds.

In the following table, the annualised return is shown and this is collected data which varies according to the returns. You can directly invest into Tax Saving Mutual Funds by clicking on the particular funds.

Things that An Investor Should Think Before Investing In The Tax Saving Mutual Funds

Following are some factors that should be considered before investing in any Tax Saving Mutual Funds.

Lock-In Period

The ELSS fund has a 3 years lock-in period. There is no provision to make premature withdrawals. The investor has to wait for 3 year.

RISK Factor

Since Tax Mutual Funds are equity-oriented, they are naturally influenced by the market movements. These funds carry all the risks that an equity fund possesses. So, The Investor must be willing to assume these risks before investing.

Tax Saving Mutual Funds
Tax Saving Mutual Funds

These schemes have a lock in period of 3 years from the date of units allotment. After the lock-in period is completed, The investor can redeem , switch to both growth and dividend options.

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