We often face difficulties in dealing with our tax issues in the process of managing our financial investments. Well, everyone strives hard in saving money through various tax saving schemes. However, it is difficult to select the appropriate one from the available options. Well, you can choose to go with Equity-linked saving scheme (ELSS) which is an open-ended mutual fund and a tax efficient instrument, which helps you to achieve your goals with assured returns against the current scenario of falling returns. ELSS scheme tax benefits are quite significant which is why it is considered as a great option for investment. Sadly, despite their gaining popularity among the savvy investors, these funds are still unknown to many of us.
So, have a look at some common facts about it-
Facts about ELSS
These funds offer the minimum locking period, which is up to 3 years. It helps their investors generate a generous amount of inflation beaten corpus on their maturity return. The lock-in period of ELSS is less compared to other tax saving investments like National Saving certificate, PPF account, Tax saving fixed deposit.
The best part of these funds is that it is a tax saving mutual fund. It offers benefits, which come under the section 80C of the Income Tax Act. With the help of this, you are able to reduce your tax liability and can lower your taxable income. One can invest up to a limit of Rs 1.5 Lakhs and it is tax-free.
If you look at the other investments, which also fall under the category of tax-saving investment tool- tax saving term deposit, PPF, etc. These all hold a maturity date. Whereas, in the ELSS case, there is no such term known as the maturity date. You can hold your ELSS investment as long as you wish to.
So, these are some common and interesting facts about ELSS. ELSS gives you the opportunity to save tax with other benefits also. Even though it-s a bit risky, with patience you can definitely expect higher returns. Hurry up and make the investment as soon as possible.
