Best ELSS Mutual Funds

Equity-Linked Savings Scheme or ELSS is an open-ended equity mutual fund. The best ELSS mutual funds invest in equity and equity-related securities of companies across the market segment. Investments in ELSS mutual funds are eligible for tax benefits under section 80C of the Income Tax Act. You can save up to Rs 1.5 lakh per year by investing in ELSS mutual funds.

It is worth noting that ELSS mutual funds come with a lock-in period of three years. This period is less than most other investment avenues available under section 80C. You can make a lump-sum investment or start a SIP to invest in best performing ELSS funds in India. The minimum amount of SIP allowed for investing in ELSS mutual fund is Rs 500. There is no maximum limit for the investment that one can make in the best ELSS funds in India.

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Top 10 Elss Mutual Funds

Fund NameCategoryRisk1Y ReturnsRatingFund Size(in Cr)
Mirae Asset Tax Saver FundEquityModerately High7.7%5star4,181
Axis Long Term Equity FundEquityModerately High-1.4%5star21,905
Canara Robeco Equity Tax SaverEquityModerately High11.2%5star1,122
BOI AXA Tax Advantage FundEquityModerately High16.8%5star299
Quant Tax Plan FundEquityModerately High28.0%4star15
Taurus TaxshieldEquityModerately High2.2%4star64
JM Tax Gain FundEquityModerately High-4.6%4star38
Tata India Tax Savings FundEquityModerately High-2.0%4star2,075
Motilal Oswal Long Term Equity FundEquityModerately High-8.2%4star1,585
DSP Tax Saver FundEquityModerately High-2.4%4star6,298
Invesco India Tax PlanEquityModerately High4.9%4star1,113
Aditya Birla Sun Life Tax Relief 96EquityModerately High5.0%4star11,001
UTI Long Term Equity Fund (Tax Saving)EquityModerately High3.0%3star1,359
Principal Tax Savings FundEquityModerately High0.1%3star403
Parag Parikh Tax Saver FundEquityModerately High19.3%3star61
View All Top 10 Elss Mutual Funds

Features of ELSS Mutual Funds

ELSS mutual funds are an ideal investment medium to save taxes and expose your capital to equity markets. This allows you to save taxes and earn significant returns from the best performing ELSS mutual funds. Since ELSS mutual funds come with a statutory lock-in period, it allows investors to stay invested for a longer period and avoid selling on impulses.

Some of the best ELSS funds to invest remain the growth funds as this reinvest the returns and ensure higher returns at the end of the lock-in period. Savvy investors can also opt for dividend reinvestment option which allows the investors to decide if they wish to reinvest the dividend based on the market conditions.

Taxability

For most investors, ELSS investments are to save taxes as these funds have a lock-in period of only three years. By investing Rs 1.5 lakhs each year, one can save taxes up to Rs 46,800. After a period of three years, gain from ELSS funds will be treated as long-term gains and taxed at 10 per cent for the gains above Rs 1 Lakh.

ELSS mutual funds enable investors to save taxes via tax deductions, tax exemptions, and benefit of indexation. The Rs 1.5 lakh that one invests can be deducted from the taxable income, and the returns under Rs 1 lakh are exempted from taxation. ELSS enables investors to save taxes and build wealth in the process.

Who Are These Funds Suited For?

ELSS mutual funds are a smart way to save a substantial amount of money that may go towards taxes. On the other hand, ELSS mutual funds may not guarantee returns as it depends on the equity market. So, ELSS mutual funds are ideal for anyone who seeks to save taxes but is willing to take a risk and expose their investment to equity markets.

Investors willing to take risks may earn higher returns as compared to fixed-income investments. However, people nearing retirement or averse to volatility should not invest in ELSS mutual funds and rather opt for NPS, PPF, and similar safer schemes. Anyone who can invest for a longer period of time beyond the statutory lock-in period should definitely invest in ELSS mutual funds.

Major Advantages

ELSS mutual funds come with a lock-in period of only three years which is less than other closed-ended funds and tax-saving instruments. This is ideal for investors looking only to save taxes and get back the capital along with any returns as soon as possible. Additionally, there is no maximum limit to invest in the ELSS mutual funds and the returns are taxed at only 10 per cent.

Best ELSS mutual funds to invest remain a safe medium for investors with no or minimal knowledge of equity market to get returns from the markets. These mutual funds are managed by experts and they pick the top companies as per their knowledge and judgement. This opens the possibility of higher returns than other tax-saving investments such as PPF or NPS.

Some of the best ELSS mutual funds in India also invest in mid cap companies. This allows investors to earn substantially higher returns than funds that invest in only large cap companies. However, the risk factor for such funds is also higher compared to the other ELSS mutual funds. It is essential that you analyse your investment goal and investment horizon before finalising any fund.

Let's have a closer look

Now let us jump and check about these top 10 mutual fund schemes.

Mirae Asset Tax Saver Fund Direct Growth

Fund Performance: This fund has given 9.36% annualized returns in the last three years. In the last year, its returns were 7.74%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 7.74% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM4,181Cr
1Y Returns7.7%

Axis Long Term Equity Direct Plan Growth

Fund Performance: This fund has given 7.27% annualized returns in the last three years. In the last year, its returns were -1.43%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing -1.43% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM21,905Cr
1Y Returns-1.4%

Canara Robeco Equity Tax Saver Direct Growth

Fund Performance: This fund has given 10.51% annualized returns in the last three years. In the last year, its returns were 11.23%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 11.23% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM1,122Cr
1Y Returns11.2%

BOI AXA Tax Advantage Direct Growth

Fund Performance: This fund has given 8.49% annualized returns in the last three years. In the last year, its returns were 16.76%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 16.76% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM299Cr
1Y Returns16.8%

Quant Tax Plan Direct Growth

Fund Performance: This fund has given 10.69% annualized returns in the last three years. In the last year, its returns were 28.02%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 28.02% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM15Cr
1Y Returns28.0%

Taurus Tax Shield Direct Growth

Fund Performance: This fund has given 5.47% annualized returns in the last three years. In the last year, its returns were 2.17%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 2.17% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM64Cr
1Y Returns2.2%

JM Tax Gain Direct Plan Growth

Fund Performance: This fund has given 4.07% annualized returns in the last three years. In the last year, its returns were -4.63%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing -4.63% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM38Cr
1Y Returns-4.6%

Tata India Tax Savings Fund Direct Growth

Fund Performance: This fund has given 4.09% annualized returns in the last three years. In the last year, its returns were -2.02%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing -2.02% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM2,075Cr
1Y Returns-2.0%

Motilal Oswal Long Term Equity Fund Direct Growth

Fund Performance: This fund has given 0.38% annualized returns in the last three years. In the last year, its returns were -8.23%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing -8.23% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM1,585Cr
1Y Returns-8.2%

DSP Tax Saver Direct Plan Growth

Fund Performance: This fund has given 3.96% annualized returns in the last three years. In the last year, its returns were -2.39%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing -2.39% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM6,298Cr
1Y Returns-2.4%

Invesco India Tax Plan Direct Growth

Fund Performance: This fund has given 7.6% annualized returns in the last three years. In the last year, its returns were 4.92%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 4.92% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM1,113Cr
1Y Returns4.9%

Aditya Birla Sun Life Tax Relief 96 Direct Growth

Fund Performance: This fund has given 4.71% annualized returns in the last three years. In the last year, its returns were 5.04%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 5.04% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM11,001Cr
1Y Returns5.0%

UTI Long Term Equity Fund Direct Growth

Fund Performance: This fund has given 4.63% annualized returns in the last three years. In the last year, its returns were 3.04%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 3.04% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM1,359Cr
1Y Returns3.0%

Principal Tax Savings Fund Direct

Fund Performance: This fund has given 1.3% annualized returns in the last three years. In the last year, its returns were 0.07%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 0.07% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹500.

Min Investment Amt₹500
AUM403Cr
1Y Returns0.1%

Parag Parikh Tax Saver Fund Direct Growth

Fund Performance: In the last year, its returns were 19.33%. It has continually hit its benchmark in the Equity segment.

Why to invest: It is one of the most remarkable Equity mutual funds in India. This fund has constantly outperformed other similar funds, providing 19.33% returns in the last one year. Minimum lump sum investment amount required to invest in this scheme is ₹500. Minimum SIP investment amount required for this scheme is ₹1,000.

Min Investment Amt₹500
AUM61Cr
1Y Returns19.3%

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