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Aditya Birla Sun Life AMC Limited

Aditya Birla Sun Life AMC Limited

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    Tax Saving Mutual Funds - ELSS Funds

    Tax Saving Mutual Fund or Equity Linked Saving Scheme (ELSS) Fund is an ideal investment option for individuals looking for tax-savings on their investments without sacrificing the opportunity for long-term capital gains. If you are seeking tax relief, you can invest up to ₹1,50,000 in an ELSS mutual fund and receive tax savings of up to ₹46,800 as per Section 80C of the Indian Income Tax Act, 1961*.

    *- this is considering income in the 30% tax bracket and 4% cess – for individuals with income in excess of INR 50 lacs and up to INR 1cr – the benefit owing to impact of surcharge would increase to INR 51,480 and for those with income in excess of INR 1cr – the benefit would increase to INR 53,820.



    Why our Tax Saving Solution makes sense for you?


    • • Offers tax savings of up to ₹46,800*
    • • Long term growth potential
    • • Provides the dual advantage of long-term gains and tax savings
    • • Flexibility to invest through a lump sum or monthly instalments


    Who should invest in Tax Saving Solution?


    • • High-income individuals seeking tax relief
    • • Investors looking for better returns
    • • Investors planning to invest for long-term goals (retirement, child’s education, higher studies)
    • • Individuals with an investment period of at least 3 years or longer


    Frequently Asked Questions

    Tax saving solution includes Equity Linked Savings Scheme (ELSS). ELSS is an equity oriented mutual fund that comes with a lock-in of 3 years and provides tax saving benefits under section 80C of the Indian Income-tax Act, 1961.

    Investing in ELSS can reduce your taxable income by up to INR 1,50,000. This can provide you with a direct tax benefit of up to INR 46,800* per year u/s 80C of the Income-tax Act, 1961.

    While tax saving is an important goal of this fund, the USP of ELSS is that it actually provides a dual benefit of tax saving along with capital growth of your investment.

    ELSS is suitable for you if you are looking out for a tax saving investment avenue which can also provide you potential capital appreciation on your investment over the long term.

    ELSS can be beneficial in the following ways –
    • Lower lock-in period of 3 years vis-à-vis 5 years in most other tax saving instruments
    • Higher potential for returns – active, market linked returns
    • Possibility of earning dividends; if dividend option is selected

    No. ELSS is subject to a lock-in of 3 years, thus is it cannot be redeemed after a year.

    No. The 3-year lock-in period is the minimum time frame for which you need to stay invested. You can continue to stay invested in the ELSS even after completion of the lock-in period. In fact, as it is an equity-oriented fund, it has the potential to earn better returns over a longer time period.

    The taxation of these funds is the same as the taxation of equity funds. As they can only be redeemed after 3 years, only long-term capital gains (LTCG) tax shall apply. LTCG tax is only applicable if the gains exceed INR 1 lac – being taxed at 10%.

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