Tax Saving Investment: Equity Linked Savings Scheme (ELSS) is one of the popular options for tax savings investment. There is a practice to invest in these funds also for retirement in the salaried class. Investments in ELSS can be done through both lump sum and SIP. Tax is also provided under Section 80C of the Income Tax Act if requested in ELSS. Its most special thing is that there is a lock in period in this category. 3 years in some and 5 years in some. For this reason, it is a better option for long term Nivea. If you look at the returns of the last 5 years, it has given fierce returns to the investors.
Why ELSS is attractive
In a financial year, you can avail tax exemption under Section 80C of the Income Tax Act on investments up to Rs 1.5 lakh. However, there is no investment limit in ELSS. The return on investment in ELSS and the amount of redemption is also completely tax-free. ELSS gives better post-tax returns, as LTCG is exempted from income tax up to Rs 1 lakh a year from ELSS mutual funds. Taxes at the rate of 10 per cent have to be paid for profits exceeding this limit. Talking about investing in ELSS, at least 80 percent of this exposure is in equity. It can technically be up to 100 percent. It also has the flexibility to invest in all market caps.
No lock-in period
These funds have a lock-in period but the speciality is that even after that, Nivea can continue in it. A scheme with a lock-in period of 3 years or 5 years can also be held for a long time. Keeping it for a longer period increases the chance of increasing returns. Here we have given the information of the fund that has given the highest return in 5 years.
Mirae Asset Tax Saver
5-Year Return: 21%
Value of 1 lakh investment in 5 years: Rs 2.60 lakh
10,000 Monthly SIP Value in 5 Years: Rs. 9.89 Lakh
Minimum investment: Rs 500
Minimum SIP: Rs 500
Assets: 5,044 crore (November 30, 2020)
Expense Ratio: 0.30% (November 30, 2020)
Risk: Less than average
BOI AXA Tax Advantage Fund
5 Year Return: 17%
Value of 1 lakh investment in 5 years: Rs 2.23 lakh
10,000 Monthly SIP Value in 5 Years: Rs 9.67 Lakh
Minimum investment: Rs 500
Minimum SIP: Rs 500
Assets: 351 Crore (November 30, 2020)
Expense ratio: 1.51% (November 30, 2020)
Risk: Average
Canara Robeco Equity Tax Shares
5 Year Return: 16%
Value of 1 lakh investment in 5 years: Rs 2.13 lakh
10,000 Monthly SIP Value in 5 Years: Rs 9.62 Lakh
Minimum investment: Rs 500
Minimum SIP: Rs 500
Assets: 1333 crores (November 30, 2020)
Expense Ratio: 1.19% (November 30, 2020)
Risk: Take
Axié Long Term Equity
5 Year Return: 16%
Value of 1 lakh investment in 5 years: Rs 2.12 lakh
Value of 10,000 Monthly SIPs in 5 years: Rs. 9.38 lakhs
Minimum investment: Rs 500
Minimum SIP: Rs 500
Assets: 26618 crores (November 30, 2020)
Expense Ratio: 0.74% (November 30, 2020)
Risk: Average
DSP Tax Saver
5 Year Return: 15.5%
Value of 1 lakh investment in 5 years: Rs 2.07 lakh
10,000 Monthly SIP Value in 5 Years: Rs 8.79 Lakh
Minimum investment: Rs 500
Minimum SIP: Rs 500
Assets: 7,015 crore (November 30, 2020)
Expense Ratio: 0.91% (November 30, 2020)
Risk: Average
(Source for Fund’s Return: Value Research)