Take advantage of ELSS Fund to save Tax

Invest In Tax Saving Mutual Funds Online

Download Tax Saving Mutual Fund Application Forms

Buy Gold Mutual Funds

Call 0 94 8300 8300 (India)

 

	Advantage of ELSS to save Tax
With gains from the BSE Sensex at eight per cent this year, close to all- time highs, this may be a good time to look at equities from a tax- saving perspective. Also, with the Direct Taxes Code (DTC) likely to be implemented soon, these will affect your investment in a tax- saving fund, too. Under Section 80C of the Income Tax Act, tax- saving mutual funds, better known as equity- linked savings schemes ( ELSS), and a few other investments are taxexempt. An investment in these funds (with an overall ceiling of ₹ 1 lakh) will reduce your tax by 20 per cent of the amount invested. Future returns (capital gains, dividends) from tax- saving equity funds are tax- free in your hands. However, in the final draft of the new tax code, no tax breaks have been provided in case you invest; only retirementoriented investments are eligible, ELSS are not. ELSS will lose tax- saving advantage in the current form of the DTC, if passed. But theres a clear need for retail investors to participate in equity markets. So, you have to give them afinancial incentive through tax savings. However, DTC provides tax exemption on long- term capital gains from equity funds. Therefore, the gains from investments will remain tax- free. ELSS funds are similar to the closed- end equity funds in the market now. Experts say within the ELSS category, investors can choose the dividend option for a similar equity exposure. Closed- end equity NFOs (new fund offers) have seen a significant collection, and it seems to suggest equity investors are not averse to locking in for three years or more. Investors willing to risk a little on their investments may consider ELSS. There are many goods to a tax- saving equity fund. One is these offer you tax savings. Second, good fund managers get time to invest for the long term due to the three- year lock- in. For investors who want tax breaks, this is definitely a good vehicle. Tax- saving funds strive to make the most of the threeyear lock- in, as a fund manager has time for long- term investment calls. ELSS funds usually have abuy- and- hold kind of a portfolio due to the certainty of investment for some time; therefore, you dont find much churn in these funds. But returns from equity investment depend on market movements. Equities offer better returns in the long run; in the short term, anything could go wrong. Data from valueresearchonline. com show tax- saving funds returned 19.26 per cent in a five- year period, beating peers in diversified funds by about 75 basis points. In a years span, however, these returned just 4.4 per cent, against 5.44 per cent by diversified funds. As market trends play a huge role in equity- fund returns, investors should invest in equities for periods of at least three years. Theres a case for lockingin money for more than three years in equities. Its a great way to save taxes, but riskaverse investors should not follow this route. For younger and risk- taking investors, this is a more potent investment. Indian markets have gone through a time correction, and the cycle looks much better from here.

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

1. ICICI Prudential Tax Plan Invest Online
2. HDFC TaxSaver Invest Online
3. DSP BlackRock Tax Saver Fund Invest Online
4. Reliance Tax Saver (ELSS) Fund Invest Online
5. Birla Sun Life Tax Relief '96 Invest Online
6. IDFC Tax Advantage (ELSS) Fund Invest Online
7. SBI Magnum Tax Gain Scheme 1993 Invest Online
8. Sundaram Tax Saver Invest Online
9. Edelweiss ELSS Invest Online

------------------

Best Performing Mutual Funds

1. Largecap Funds Invest Online
1. DSP BlackRock Top 100 Fund
2. ICICI Prudential Focused Blue Chip Fund
3. Birla Sun Life Front Line Equity Fund
2. Large and Midcap Funds Invest Online

1. ICICI Prudential Dynamic Plan
2. HDFC Top 200 Fund
3. UTI Dividend Yield Fund
2. Mid and SmallCap Funds Invest Online

1. Reliance Equity Opportunities Fund
2. DSP BlackRock Small & Midcap Fund
3. Sundaram Select Midcap
4. IDFC Premier Equity Fund
3. Small and MicroCap Funds Invest Online

1. DSP BlackRock MicroCap Fund
4. Sector Funds Invest Online

1. Reliance Banking Fund
2. Reliance Banking Fund
5. Tax Saver MutualFunds Invest Online
1. ICICI Prudential Tax Plan
2. HDFC Taxsaver
3. DSP BlackRock Tax Saver Fund
4. Reliance Tax Saver (ELSS) Fund
6. Gold Mutual Funds Invest Online

1. Relaince Gold Savings Fund
2. ICICI Prudential Regular Gold Savings Fund
3. HDFC Gold Fund