How does ELSS help save tax?
An equity-linked savings scheme or ELSS is a tax-saving investment under Section 80C of the Income Tax Act, 1961. By investing in ELSS, you can claim a tax rebate of up to Rs 1,50,000 a year and save up to Rs 46,800 a year in taxes. An ELSS is the only kind of mutual fund eligible for tax benefits under Section 80C.
What is ELSS fund and how it works?
ELSS Mutual Fund. As the name suggests, Equity Linked Saving Scheme or ELSS is a type of mutual fund scheme that primarily invests in the stock market or Equity. 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.
What is meant by ELSS funds?
An Equity Linked Saving Scheme (ELSS) is an open-ended equity mutual fund that invests primarily in equities and equity-related products. They are a special category among mutual funds that qualify for tax deductions under Section 80C of the Income Tax Act, 1961.
How do I withdraw my ELSS mutual fund after 3 years?
If you have made your ELSS Mutual Fund investment via the lump sum route, i.e., at one go, all your units will be allotted on the same day. And therefore, once the 3 year lock-in period is over, you can redeem your entire ELSS investment in one go.
What are the tax benefits of investing in ELSS?
They offer tax benefits under the new Section 80C of Income Tax Act 1961. ELSS can be invested using both SIP (Systematic Investment Plan) and lump sums investment options. There is a 3 years lock-in period. You will get a tax deduction of up to ₹ 1.5 lacs, and the profits from ELSS schemes are subject to LTCG similar to equity .
What is ELSS (equity-linked savings scheme)?
Equity-linked savings scheme, popularly known as ELSS, are open-ended, diversified equity schemes offered by asset management companies in India. They offer tax benefits under the new Section 80C of Income Tax Act 1961. ELSS can be invested using both SIP (Systematic Investment Plan) and lump sums investment options.
What is the lock-in period of ELSS?
There is a 3 years lock-in period. You will get a tax deduction of up to ₹ 1.5 lacs, and the profits from ELSS schemes are subject to LTCG similar to equity . Note : To get tax benefits from ELSS, you will need to provide the ELSS statement as proof of investment.