ELSS or Equity Linked Saving Scheme is a type of mutual fund instrument that is extremely beneficial for salaried individuals and self-employed persons. It can be especially useful for you if you come under the 30% tax bracket of income tax (which means your annual salary is more than 15 lakhs).
By investing in this mutual fund you will not only be able to take advantage of Section 80C of the income tax act but beat inflation simultaneously. To invest in the ELSS mutual fund you will need to have a Demat account. In this article, we will discuss some of the best ELSS funds you can invest in 2023.
Best ELSS funds you can invest in 2023
|
Name of the fund |
AUM (Cr.) |
Expense ratio |
1Y Absolute returns (%) |
3Y CAGR (%) |
|
HDFC Taxsaver |
10353.90 |
1.19 |
11.68 |
16.42 |
|
ICICI Pru LT Wealth Enhancement Ltd. |
35.74 |
0.97 |
11.55 |
14.26 |
|
Quant Tax Plan |
2327.41 |
0.57 |
10.25 |
37.43 |
|
Parag Parikh Tax Saver Fund |
941.56 |
0.82 |
8.22 |
23.84 |
|
Quantum Tax Saving Fund |
115.49 |
1.29 |
8.04 |
14.98 |
|
Sundaram LT Tax Adv Fund-Sr I |
18.51 |
1.01 |
7.60 |
16.24 |
|
SBI Long Term Equity Fund |
11923.53 |
1.12 |
7.35 |
17.04 |
|
Sundaram LT Tax Adv Fund-Sr II |
11.70 |
1.20 |
7.21 |
16.14 |
|
Taurus Tax Shield Fund |
62.54 |
1.73 |
7.08 |
13.30 |
|
SBI Tax Advantage Fund-III |
30.57 |
2.60 |
6.99 |
27.68 |
(Last updated on 26th January 2023)
Features of ELSS Mutual 2023
Asset allocation
The ELSS mutual funds follow the guidelines mandated by SEBI which suggests that these funds must devote minimum 80% of their investment funds into equities.
Taxability
ELSS mutual fund schemes have a lock-in period of 3 years which means the revenue generated from these schemes comes under the LTCG or Long Term Capital Gains. Therefore, if an investor generates more than Rs. 1 lakh by selling their units then a 10% tax will be levied on the same.
The ratio of risk and reward
Most of the ELSS funds put their funds into equities and that is why the stock market condition severely affects the performance of these schemes. If the stock market is performing well then the ELSS schemes will be able to generate handsome returns and if the market conditions are bad then these investments will also bear the same risk.
Final words
ELSS mutual funds can be a tax saver for individuals and you will also be able to receive short-term benefits by investing in this financial instrument. However, if you want to manage your ELSS mutual fund along with other assets then you should opt for an all-in-one Demat account which you can get from 5Paisa.
5Paisa is an online platform in which you can invest in commodities, derivatives, stocks, etc. using just one Demat account. Furthermore, you can open your Demat account within just 5 minutes through this platform. Begin your investment journey with 5Paisa today.
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