What is Tax Saver/ELSS Fund?

ELSS funds are equity funds that place a significant percentage of their corpus in equity or products with an equity component. Since ELSS funds offer a tax exemption of up to Rs. 150,000 from your annual taxable income under Section 80C of the Income Tax Act, they are also known as tax saving plans.

Features of ELSS Mutual Funds

• Equity and equity-related instruments account for at least 80% of the entire investible corpus.
• The fund makes diversified stock investments across a range of market capitalizations, themes, and industries.
• There is no maximum investment tenure. A three-year lock-in period does exist, though.
• Section 80C of the Income Tax Act provides a tax exemption on the amount invested.
• Income is regarded as LTCG and subject to general tax laws.