sir which mutal fund for tax savings is best
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Equity-Linked Savings Scheme (ELSS) is a type of fund that may suit your query.
I suggested ELSS for your portfolio because this is the only mutual fund that offers a tax deduction of up to Rs. 1.5 lakh under section 80C of the Income Tax Act.
Equity Linked Saving Scheme(ELSS ) are basically equity funds that provide the lock-in period is 3 years. ELSS can be structured as monthly SIPs and you can claim all the SIP contributions as exemption during the fiscal year. The real advantage of investing in ELSS is that you can synchronize your tax planning with your income flows and also get the benefit of rupee cost averaging.
The logic of investing in any ELSS funds should be the same as in the case of equity funds, all you need to do is to benchmark past returns with the benchmark index and the peer group. However, the question has two different aspects, should investment in ELSS beyond section 80C limit is good or should ELSS be redeemed on completion of 3 years? The main characteristic of ELSS is that its exemption falls in the highest tax bracket (30%), and if that limit has already exhausted there’s no point in blocking your money in ELSS. Also, it is not mandatory to `redeem your ELSS after completion of 3 years. After that period, it is like any other equity fund and hence you can redeem it as and when needed.
You can look out for some Top performing ELSS Funds in India:
Quant Tax Plan (G)
Axis Long term Equity
Kotak Saver Fund
Aditya Birla Tax Relief, and others.
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Sir / Ma'am,
You can check the performance of
1. Axis Long Term Equity Fund
2. Mirae Asset Tax Saver Fund
3. DSP Tax Saver Fund
4. Invesco India Tax Fund
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Schemes which are earmarked as ELSS qualify for tax deduction under 80c. The limit is for 1.5 lakhs. Some of the best performing schemes are
Axis Long Term Equity Fund and Aditya Birla Sun Life Tax Relief 96
You should invest in ELSS only if you have the risk appetite to invest in stocks or equity. Equity, as you would know, is a risky asset cl***; it can also be very volatile in the short term