Breads are of different types, but whole wheat bread is the best for health. Similarly, mutual funds are of various types but Equity Linked Saving Scheme or ELSS funds help you save on tax. Basically, ELSS is a type of mutual fund with tax benefits, where you can save income tax up to 1.5 lakhs under Section 80C. These funds have a lock-in period of 3 years and a majority of their portfolio lies in investing in stock markets.
Read on as we tell you the basic know-hows of Equity Linked Saving Scheme.
How to invest in ELSS?
You can invest in ELSS funds by going to your preferred company’s website. The investments can either be in lump sum or in instalments. However, point to be noted is that each instalment is considered to be a fresh investment, and the lock-in period for each instalment would be 3 years, separately.
What tax benefits can be availed from an ELSS?
An investor of ELSS can attain tax benefits of up to Rs 1.5 lakhs in a year. The returns generated on the investments are also tax-free on completion of three years. In case of instalments