Let’s understand the top 5 ELSS tax – saving mutual funds to invest in 2019


ELSS is an equity-linked saving scheme; you can invest in ELSS funds to save tax under 80 C along with long term benefits of yields like equity.

Tax deductions under section 80 C are both equity-linked savings schemes and public provident funds.

ELSS is a form of a mutual fund, which is tax-deductible under section 80 C. ELSS funds must invest at least 80% of their assets in equity and are therefore subject to market fluctuations. However, due to their equity component, such funds may generate higher yields. In the long term, these yields can reach 10 to 12 percent.

Therefore, between the two investment goals, ELSS enables you to save your tax and build your wealth.

ELSS equity funds can be combined with one’s long-term financial objectives such as retirement, etc., so it makes sense to invest in PPF for at least 15 years.

In ELSS funds, you can start SIP, which can be less than Rs 500 per month.

Now your question is: what are the best ELSS fund SIPs to start investing keeping in mind the rolling income and risk analysis, this is my list of recommendations for 2019. Rolling returns mean that if I have been investing in these funds for at least five years, the probability of getting an adverse yield was zero.

If you plan to save tax under Section 80C, then tax-saving mutual funds will follow where you can park your hard-earned cash. 

You should only invest in ELSS if you are interested in investing in the equity scheme but also if you have the risk appetite to invest in the equity scheme. Also, include in your ELSS Investment General Financial Plan.

A look at the tax saving mutual fund scheme (G):

  • Mirae Asset Tax Saver Fund (G)
  • ICICI Prudential Long Term Equity Fund (G)
  • Axis Long – Term Equity Fund (G)
  • Aditya Birla Sunlife Tax Relief 96 Fund (G)
  • L&T Tax Advantage Fund (G)
  • Motilal Oswal Long Term Equity Fund

Investment and Withdrawal

You can invest in ELSS funds in a lump sum or SIP mode. A SIP or Systematic Investment Plan invests a specified amount of money each month in a mutual fund. The ELSS fund has a three-year lock-in. Then at any time, you can stay invested or withdraw your investment.

Tax on gains

ELSS fund earnings will be subject to long-term capital gains tax at the rate of 10%. However, you get a long-standing capital gain exemption of up to Rs 1 lakh per year.

Top 5 ELSS tax saving mutual funds:

  1. Motilal Oswal Long Term Equity Fund
  2. Aditya Birla Sun Life Tax Relief 96
  3. L&T Tax Advantage
  4. Invesco India Tax Plan
  5. Axis Long Term Equity Fund

Note: No need to wait for a new financial year for your tax-saving investment because it is a great time to start your tax-saving investment. And you understand that the best way to save tax is Equity Linked Savings System (ELSS) or Tax saving Mutual Fund Planning scheme. Investments in ELSS funds are eligible under Section 80 C of the Income Tax Act Up to Rs 1.5 lakh for tax deductions. Go ahead and start your SIP in an ELSS immediately.

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