Equity Linked Savings Scheme Funds 2020

The ELSS Funds are Equity Linked Saving Schemes that make it possible for people to save huge money on their tax payments while incurring profit through equities at the same time. There are takers for ELSS Funds by people of every age group and in every profession.

While there are many benefits that come with investing in equities, such investments have to be carried out with care so as to avert long term risks and losses that these investments may otherwise be prone to. For this purpose it is a good idea to be well acquainted with some of the best ELSS Funds that can be invested in.

What is ELSS Mutual Funds?

Equity Linked Savings Scheme or ELSS Funds is an open-ended Equity Mutual Funds that help you save and provide an opportunity to grow money. When almost all equity funds restrain you from paying long-term capital gains tax of 10.4% up to an amount of Rs. 1 lakh, ELSS mutual funds offer tax benefit. That’s why these MF funds are also known as tax saving mutual fund schemes. By investing in ELSS, you can save tax up to Rs. 1.5 lakh as per the Section 80C of IT( Income Tax) Act.

The only catch is here is best ELSS funds comes with a lock-in-period of 3 years. That means every instalment you make towards ELSS is subject to 3 a year-lock-in.

Why should you invest in an ELSS mutual funds?

ELSS funds come with huge benefits. The most common reasons for investing in an ELSS fund are:

• Tax saving benefit is the prime reason to invest in best ELSS funds. As per the Section 80C of Income Tax Act 1961, you can avail tax benefits by investing in these funds up to Rs. 1.5 lakh.
• It helps is build a habit of investing for a longer period. Although the other mutual fund schemes come with long-term investments, they are not bound with a fixed lock-in-period. On the other hand, with ELSS mutual funds, you need to invest for a minimum of 3 years. Moreover, by investing for a longer period, you can be exempted from paying taxes on returns earned.
• With a longer investment option, you can allow your funds to grow and redeem the benefits after 3 years. Since ELSS funds invest the money in equities, the possibility of earning good returns is higher.
• With ELSS mutual funds, you can inculcate saving habit in a systematic way. These funds allow you to start an investment with as low as Rs. 500 p/m. This nurtures the habit of investing.
• Best ELSS funds allow you to invest in the stock market. Where a normal savings account gives a return of a maximum of 8%, by investing these funds you can reap the benefits of higher returns.

Best ELSS Funds to Invest in 2018-19

As there are a plenty of options that offer good investment opportunities like PPF, NSC, FD to name a few. However, the catch is the returns you earn from these investments are taxable. This is where ELSS is exceptional which comes with higher returns that are partially taxable, only if the gains are above Rs 10 lakh.

With the next fiscal year approaching close and responses for equity markets turning positive, investments in ELSS are on the rise. Let’s know some of the best ELSS funds that you can consider for the upcoming year.

Well, the list is not a comprehensive one and it is recommended to do thorough research whenever is investing in these funds.

Axis Long Term Equity Fund

The Axis Long Term Equity Fund is an ELSS Investment Scheme that was launched in December 2009. This is one of the best investment plans to opt for in order to save on income tax payments every year and there are a number of benefits associated with such an investment.

• By investing as much as 1.5 lakhs in a year, tax payers can end up saving up to 46,350 INR.
• The Axis Long Term Equity Fund schemes that we offer our clients with come with a lock in period for about three years.
• Those who make investments under this scheme are guaranteed to be exempted from the payment of income tax at the end of the financial year as per the regulations listed under section 80 C of the Income Tax Act of 1961.
• The money that customers invest in our Axis Long Term Equity Fund schemes will give excellent returns over specific periods of time.
• By making use of the three year lock in period, the Axis Long Term Equity Fund provides customers with a unique approach towards equity investing.
• The lock in period that is associated with this particular fund creates situations whereby the interests of both the fund manager as well as the investor are looked into.
• This it does by ignoring short term gains and by paying more attention to long term opportunities.
• The Axis Long Term Equity Fund targets companies that are capable of growing profits in a sustainable manner and that can generate wealth over a period of three to four years.
• Fund managers are thus able to overlook the short term volatilities in stock prices and also the temporary hiccups that may arise in the earnings of the company.
• Managers of the Axis Long Term Equity Fund judge individual stocks entirely on the basis of their prospects instead of worrying about the overall direction of the market.
• As a result, this fund has managed to create huge value for its investors ever since its inception in the stock market.

Franklin India Tax Shield Fund

The Franklin India Tax Shield Fund also ranks among one of the best Equity Funds in the stock market. As the name suggests, this too is an ELSS Funds scheme that can enable investors to incur huge savings from their annual tax payments.

The Franklin India Tax Shield Fund investment options that we offer are certainly worth investing in as these are also investments that are characterised by a lock in period of only three years. The tax savings are pretty substantial, with investors being capable of saving as much as 50,000 INR annually on their income tax payments.

Apart from being able to save on their tax payments, investors can also incur great returns from growth potential that is associated with equities. While it cannot be denied that equities are subject to market volatility, the returns that investors can reap are also very substantive. The long term growth in capital that is typical of ELSS Funds including the Franklin India Tax Shield Fund makes it worth the risk associated with investing in such ELSS Funds in the first place.

It is very convenient to invest in ELSS Funds like the Franklin India Tax Shield Fund. The entire investment procedure is one that can be carried out online in a smooth and efficient manner. Investment applications get processed almost instantly and there is no long drawn out or tedious paperwork to attend to.

Another convenient aspect that is associated with Franklin India Tax Shield Fund investment is the fact that investors can begin investing with an amount as low as 500 INR. This allows investors to test the market volatility and decide whether they would like to continue with the investment for the long term or not.

ICICI Prudential Tax Plan

It is always a good idea to invest in the ICIC Prudential Tax Plan in order to be able to save on income tax payment and incur growth through equities all at the same time. This is an ELSS Fund that has been in existence for quite some time now and caters to the interests of investors of every age group from both salaried and business backgrounds.

There are several benefits that are associated with the ICICI Prudential Tax Plan that are worth keeping in mind for those looking to invest in this at any point of time

• The returns can turn out to be quite high while the minimum amount that needs to be invested every month via SIP is just 500 INR.
• The minimum amount that can be withdrawn from this fund is about 1000 INR in multiples of one.
• The ICICI Prudential Tax Plan comes with a lock in period that lasts for 3 years.
• This makes it possible for fund managers to make careful investments in order to achieve capital appreciation and growth for the long term.
• Investing in the ICICI Prudential Tax Plan is quite a hassle free affair as this can be done online at any point of time.
• It is possible to invest in the ICICI Prudential Tax Plan on the part of any person who is above 18 years of age.
• While tax savings can also be incurred by investing in national security schemes and in the public provident fund, the amount of money that can saved, through an investment in ICICI Prudential Tax Plan is higher.
• The average amount that may be saved by salaried persons who invest in such ELSS Funds ranges between 40,000 INR to 50,000 INR depending on the maximum amount that is being invested in a year.

Canara Robeco Equity Tax Saver Fund

The Canara Robeco Equity Tax Saver Fund is highly beneficial for tax payers as it gives them opportunity to save on income tax payments while experiencing growth through equities at the same time. This is an investment plan for which the lock in period is around 3 years.

One can invest an amount as meagre as 500 INR to begin with. It is possible to carry out a Systematic Investment Plan as far as the Canara Robeco Equity Tax Saver Fund is concerned with investments being made in multiples of 500 and 1000.

While the risks that come with such an investment plan can never be wished away, the returns that investors are likely to incur are many more in number. Investors can often end up reaping 50% more of what they had invested in when they choose the Canara Robeco Equity Tax Saver.

The formalities that are associated with signing up for such a mutual funds scheme are very minimal. The application will have to be submitted online along with certain personal and financial details.

It takes three to four months for these details to get verified. Thereafter potential investors are likely to be provided with a username and password with which to access their mutual funds account online and monitor their investments on a daily or monthly basis.

 NAV’s

Religare Invesco Tax Plan

The Religare Invesco Tax Plan is a sound ELSS Funds investment scheme that is worth opting for on the apart of business owners and salaried employees who want to make huge savings on income tax payments. This tax plan was launched on 20^th November 2006 and is an open ended equity investment option catering to investors of any and every budget.

The minimum amount that can be invested as a part of this scheme is 500 INR and then in multiples of 500 thereafter. The dividends associated with the Religare Invesco Tax Plan are not immune to market risks but are very high.

As is the case with all other ELSS Funds schemes, the lock in period is for 3 years thus making it possible for investors to benefit from the long term appreciation and growth of capital. Signing up for this investment scheme can be done in a matter of minutes as the investment applications are always processed online.

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