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The best ELSS funds to invest in 2020

Equity Linked Saving Schemes, called ELSS in short, are very popular mutual fund investment schemes. These schemes allow you the dual benefits of wealth creation and tax saving. The money that you invest in an ELSS fund is allowed as a deduction under Section 80C of the Income Tax Act, 1961. You can claim a deduction of up to INR 1.5 lakhs by investing in ELSS schemes which helps you lower your tax liability.

Nidhimehra
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The best ELSS funds to invest in 2020

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  1. The best ELSS funds to invest in2020 • Equity Linked Saving Schemes, called ELSS in short, are very popular mutual fund investment schemes. These schemes allow you the dual benefits of wealth creation and tax saving. The money that you invest in an ELSS fund is allowed as a deduction under Section 80C of the Income Tax Act, 1961. You can claim a deduction of up to INR 1.5 lakhs by investing in ELSS schemes which helps you lower your tax liability. Some of the features of ELSS funds are as follows– • They are equity-oriented mutual funds where at least 65% of the portfolio is invested in equity-orientedstocks • ELSS funds have a lock-in period of 3 years during which you cannot switch or redeem your investments • Returns earned from ELSS funds and other equity investments are tax-free up to INR 1 lakh. If the returns exceed INR 1 lakh, the excess return would be taxed@10% • You can invest in ELSS funds either in a lump sum or through SIPs (Systematic Investment Plans) • Given the tax-saving nature and high return potential of ELSS funds, the mutual fund market has various ELSS schemes. Among the multiple schemes, choosing the best schemes which give the best returns might prove difficult. So, to make your choice easier, here is a list of some of the • top-performing ELSS funds in India– • Mirae Asset Tax SaverFund • This scheme is offered by Mirae Asset Mutual Fund and has performed consistently well over the past few years. The fund was launched in November 2015 and follows the benchmark of Nifty 200 TRI. As of 12th February 2020, the Assets under Management (AUM) stood at INR 3293 crores. The expense ratio of the fund as on 31st December 2019 was 0.28% and the returns provided by the fund as on 12th February 2020 was16.13%. • Axis Long Term EquityFund • A very popular scheme of ELSS, Axis Long Term Equity Fund has given very good returns over the years and is considered to be the best ELSS fund to invest. The expense ratio of the fund as on 31st December 2019 was 0.92% and the current AUM stands at INR 21,997 crores. The benchmark of the fund is S & P BSE 200 TRI. The annual return provided by the fund as of 12th February 2020 is12.53%. • Kotak Tax SaverFund • Kotak’s mutual fund schemes feature in some of the best schemes in India and its ELSS scheme is no different. Kotak Tax Saver Fund was launched in 2013 and has been consistently giving good returns to investors. The AUM of the fund is INR 1155 crores and its expense ratio as on 31st December 2019 was 1.24%. The fund’s benchmark index is Nifty 500 TRI and it has outperformed the benchmark several times over the years. As of 12th February 2020, the fund’s annual return was10.75%. • Invesco India TaxPlan

  2. Another popular ELSS fund, Invesco India Tax Plan was introduced in 2013 and has amassed an asset base of INR 1026 crores till February 2020. The fund’s benchmark index is S&P BSE 200 TRI and it has given an annual return of 11.36% as of 12th February2020. 4. Tata India Tax SavingsFund Coming from the house of Tata Mutual Fund, Tax India Tax Savings Fund is an ELSS scheme which gives good returns. The minimum investment amount is INR 500 under both lump sum and SIP investment mode. The expense ratio for the fund stood at 0.62% as of 31st December 2019 and as of 12th February 2020, the fund’s annual return was11.91%. Here’s a comparative analysis table for the above-mentioned top performing ELSS funds in India– So, take your pick from the afore-mentioned best ELSS funds to invest and you would be able to earn attractive returns. Moreover, if you choose the old tax regime to calculate your tax liability, you would be able to claim a deduction for your ELSS investments under Section 80C of the Income Tax Act, 1961. However, if you choose to calculate your tax liability as per the new tax regime which has been introduced in Budget 2020, the deduction for ELSS investments would not be available. You would, however, be able to earn attractive returns without getting the tax benefit. So, choose which tax regime gives you a lower tax outlay while at the same time invest in ELSS funds to create wealth for your financial goals.

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