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Equity Linked Savings Scheme (ELSS) is a type of mutual fund scheme that invests in equity-related instruments and helps you claim your investment in an ELSS for an income tax deduction. Rajiv Gandhi Equity Saving Scheme or RGESS was a mutual fund along with tax advantage that was offered by the Government of India to encourage flow of savings of small retail investors in the domestic capital market. 1 lakh, ELSS mutual funds offer tax benefit. ELSS also has a mandatory lock-in period of three years. If you have not exhausted the Section 80C … For better understanding: Mutual funds are companies that pool the investment of its investors and buy securities such as equities, debts etc. It also suggested that the government allow debt linked savings schemes (DLSS), similar to the equity linked savings schemes (ELSS), which are tax-saving plans, the Times of India mentioned in a report. These mutual fund plans stands out from other schemes with its high return potential and partially taxable nature. Tax savings of Rs. An Open-ended Equity Linked Savings Scheme with a statutory lock in of 3 years and tax benefit. This is an equity diversified fund and investors enjoy both the benefits of capital appreciation, as well as tax benefits. 80C of the Indian Income Tax Act. In ELSS,the majority of funds are invested in equities. The investment made in ELSS funds qualifies for tax exemption under Section 80C of the Income Tax Act. A Equity Linked Savings Scheme, popularly known as ELSS, is a type of diversified equity scheme which is close-ended, with a lock-in period of three years, offered by mutual funds in India. ... Don't Miss It. The deduction comes under section 80C of Chapter VI-A of the Income Tax Act. With the financial year coming to a close and sentiments towards equity markets turning positive, investments in ELSS are on the rise. All about ELSS | Equity Linked Savings Scheme | Tax Saving Mutual Funds. If you’re looking for tax saving mutual funds look for an ELSS mutual fund or Equity Linked Savings Scheme. the ELSS tax benefit, is what sets ELSS apart from other equity-oriented mutual fund schemes. Features of ELSS Mutual Funds. Sometimes, when we focus on a single benefit, we may overlook a big opportunity. These are managed by professionals and experts and hence result in greater returns as compared to other tax-saving investments.. Taxpayers can benefit from up to Rs. and come with a host of benefits. An Equity Linked Savings Scheme (ELSS) is a mutual fund equity scheme, that offers wealth creation over the long-term along with tax benefits under Section 80C of the Income Tax Act, 1961. Named after Rajiv Gandhi, the sixth Prime Minister of India, the scheme was announced by the finance minister, P. Chidambaram, on 21 September 2012. ELSS is a diversified equity mutual fund where the investors enjoy the dual benefits of capital appreciation as well as taxation benefits. This means that if the systematic investment plan or SIP starts then each of the investment gets locked for three years and the investor cannot withdraw anything before the maturity of the mutual fund i.e. It invests primarily in equity or equity related instruments. 1. The advantage ELSS has over other tax Saving instruments is the shortest lock-in period of 3 years. Equity Linked Savings Scheme (ELSS) is a kind of mutual fund scheme that helps in saving taxes under Section 80C of the Income Tax Act and invest equity related instruments to generate high returns. Investors looking to save tax can consider equity-linked saving schemes (ELSS) with a three-year lock-in period. Equity-linked savings scheme (ELSS) Are you looking for some tax saving options? ELSS is a type of diversified equity mutual fund where most of the corpus is invested in equity and equity-related products. Text Search: 9 Record(s) | Page [1 of 1] Rule - 1. Equity Linked Savings Scheme (ELSS) The ELSS or Equity Linked Savings Scheme is the only kind of mutual funds that are covered under Section 80(C) of the Income Tax Act, 1961. An Equity Linked Savings Scheme (ELSS) is an open-ended Equity Mutual Fund which gives following advantage-Opportunity to grow your money. three years. Equity-linked saving scheme (ELSS) is like any other mutual fund scheme which includes equity-linked tax saving securities where returns are managed with tax-saving preferences of investors. ELSS funds invest more than 80% of its corpus in equities and equity-related instruments. It comes with a lock-in period of three years and provides individuals/HUFs a deduction from gross total income for investments in Equity-Linked Savings Scheme upto ₹1.5 lakh under section 80C of the Income Tax Act 1961. The scheme is popular as it has the shortest lock-in period among all tax-saving schemes under Section 80(C). Why ULIPs Are One of the Best Tax-saving Instruments in India. An Equity Linked Savings Scheme (ELSS) is an open-ended Equity Mutual Fund that not only helps you save tax, but also gives you an opportunity to grow your money. A mandatory lock-in period of three years is the main feature of ELSS. The scheme offers the dual benefit of tax saving and wealth creation. Equity Linked Savings Scheme ( ELSS) Equity-linked savings scheme is a type of equity mutual fund that comes with the double benefit of tax saving and wealth creation. ELSS funds have a lock-in period of three years. Short title and commencement. Tag: Equity Linked Savings Scheme. However as per Finance Act 2018 LTCG on ELSS (equity oriented) in Excess of Rs 1 lakh is taxable @ … These mutual funds … L&T Mutual Fund, one of India’s top asset managers with total AUM of Rs. Rule - 3. In also addition, with the investment in the ELSS Funds an investor can save taxes up to ₹ 46,800 under Section 80C of the Income Tax Act. What is ELSS? ELSSes can be invested using both SIP (Systematic Investment Plan) and lump sums investment options. 1.5 lakh per year by investing in ELSS funds. The Equity Linked Saving Scheme is the mutual fund that has the lock-in period of three years from the date of investment. Equity Linked Savings Scheme funds (ELSS) are tax-saving mutual fund schemes primarily invest in stock market, ideal for investors who plan to generate wealth and save taxes. How ELSS works? Environment . The latter part, i.e. Investments of up to 1.5 Lac done in ELSS Mutual Funds are eligible for tax deduction under section 80C of the Income Tax Act. Other than traditional investment options, you can consider investing in equity as an asset class with ELSS (Equity Linked Savings Scheme), which is an equity mutual fund with a 3-year lock-in. Among the many instruments available for in the market, Equity-linked savings scheme (ELSS) are one of the preferred options. What is ELSS or Equity Linked Savings Scheme ? One such way is the ELSS (Equity linked savings scheme). 1,50,000. ELSS are usually termed as tax saving schemes since they offer an exemption of upto INR 1,50,000. These are tax saving-cum-investment schemes offered by most banks, fund houses, AMCs, etc. They offer tax benefits under the Section 80C of Income Tax Act 1961. Rule - 2. Equity Linked Saving Scheme (ELSS): The most popular and rewarding form of tax saving investment, which incidentally also carries the shortest lock-in period, is ELSS. Equity Linked Savings Scheme (ELSS) Equity Linked Saving Scheme Fund is nothing but a tax-saving Equity Mutual Fund. Equity Linked Saving Scheme or ELSS is a type of mutual fund scheme that primarily invests in equity and equity related instruments to generate high returns. That’s why these MF funds are also known as tax saving mutual fund schemes. In this article, you will know the 3 reasons why it would be beneficial for you. It qualifies for tax exemptions under section 80C of the Indian Income Tax Act, 1961. The same applies to the choice of your tax saving investments; so don't just save tax, but aim to create wealth by investing in an Equity Linked Saving Scheme (ELSS). Equity Linked Savings Schemes (ELSS) is also a form of savings scheme where you in invest in mutual funds but with the same tax benefits. *As per the present tax laws, eligible investors (individual/HUF) are entitled to deduction from their gross income of the amount invested in Equity Linked Saving Scheme (ELSS) up to Rs.1.5 lakhs (along with other prescribed investments) under section 80C of the Income Tax Act, 1961. More. What is ELSS Mutual Fund. SBI’s CSR package in Nagaland. An equity linked savings scheme (ELSS) is a type of mutual fund which invests the majority of its total assets in equity and equity-related instruments. ELSS mutual funds are qualified for tax exemptions under section (u/s) 80C of the Indian Income Tax Act and people can claim the same by starting an ELSS fund and file ITR. It was announced in the Union Budget of 2012-13 and extended in 2013-2014. Unlike all other types of tax saving investments, ELSS has a lock-in period of just 3 years, which is the lowest! An ELSS comes with a statutory lock-in period of 3 years and qualifies for a tax exemption under Section 80C of the Income Tax Act which allows a maximum tax exemption of Rs. One of the most popular Sec 80C investments is in tax saving mutual funds or Equity Linked Savings Scheme (ELSS). Let’s see what happens to your money when you invest in these schemes. The difference here is that investment in ELSS is linked to equity or in other words, stock markets. The Rajiv Gandhi Equity Savings Scheme (commonly referred to as RGESS), is a tax saving scheme announced in the 2012-2013 Union Budget of India, aimed at first time retail investors. about EQUITY LINKED SAVINGS SCHEME Tax Saving + Potential Wealth Creation. When almost all equity funds restrain you from paying long-term capital gains tax of 10.4% up to an amount of Rs. It is a diversified equity mutual fund that helps you to save tax as per the current tax laws with the growth potential of equities. Qualifies for tax exemptions under section u/s. These are tax-saving mutual funds that you can use to save income tax up to Rs 1.5 lakh under Section 80C. Investors are … 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 it comes to investing in India, one instrument that is gaining immense popularity is the Unit-Linked Insurance Plan (ULIP). The scheme is aimed at encouraging the flow of savings of … Worth mentioning here is that it has been a long standing demand by most of the fund houses as both MFs and ULIPs are investment products and invest in securities. Firstly, any amount up to Rs.1,50,000 invested in ELSS is exempted from income tax. An Equity Linked Savings Scheme (ELSS) fund is an open-ended Equity Mutual Fund that helps you in tax saving (best tax saving mutual funds) and provides an opportunity for you to grow your money. ELSS comes with a lock-in period of 3 years from the date of investment, which means that … ELSS funds have a lock-in period of 3 years and invest a majority of their portfolio in the stock market. An ELSS or Equity Linked Savings Scheme is just like any other mutual fund scheme. Definitions. ELSS has a lockin period of 3 years from the date of investment i.e. Income Tax Department > Tax Laws & Rules > Rules > Equity Linked Savings Scheme, 2005 Income Tax Department > All Rules > Equity Linked Savings Scheme, 2005 Choose Rules: Rule No. Benefits of ELSS Your ideal tax saving investment . Long-term capital gains from these funds are tax free in your hands. However, the Union Budget of India of 2017 proposed that RGESS be completely phased out by 2018 … One such scheme which offers tax benefits up to Rs 1,50,000 per annum under Section 80C of the Income Tax Act is the Equity Linked Savings Scheme or ELSS. ELSS stands for Equity Linked Savings Scheme. ELSS is a type of Mutual Fund which allows you to claim for income tax deduction. 46,800 mentioned above is calculated for the highest income tax slab. ] Rule - 1 is gaining immense popularity is the main feature of ELSS related! 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