Which mutual fund is eligible for 80C? (2024)

Which mutual fund is eligible for 80C?

What is ELSS? ELSS is a type of Mutual Fund which allows you to claim for income tax deduction. You can save up to ₹ 1.5 lakhs a year in taxes by investing in ELSS, which is covered under Section 80C of the Income Tax Act, 1961.

Which mutual fund is covered by 80C?

An ELSS fund or an equity-linked savings scheme is the only kind of mutual funds eligible for tax deductions under the provisions of Section 80C of the Income Tax Act, 1961. You can claim a tax rebate of up to Rs 1,50,000 and save up to Rs 46,800 a year in taxes by investing in ELSS mutual funds.

Which investment is eligible for 80C *?

Section 80C: This covers investments in Provident Funds like EPF, PPF, payment of life insurance premiums, Equity Linked Saving Schemes, payment of home loan principal, SSY, NSC, SCSS, among others.

Is SIP investment eligible for 80C deduction?

You can initiate an SIP into an ELSS, the most popular tax-saving investment under Section 80C of the Income Tax Act, 1961. Every SIP instalment into an SIP counts towards tax deductions under Section 80C. You can claim a tax rebate of up to Rs 1,50,000 and save up to Rs 46,800 a year in taxes.

How much mutual fund can be deducted under 80C limit?

Investors can avail of tax deduction up to Rs. 1.5 lakh under Section 80C. Any gains earned through ELSS Mutual Funds are exempt from tax. Offers investors high earning potential by exposing them to equity markets.

Which mutual fund is best for tax exemption?

How to invest in mutual funds for tax exemption?

Profits from sale of ELSS fund units are considered long-term capital gains and hence, are tax free. The best way of investing into ELSS funds is through monthly SIPs (systematic investment plan). The minimum investment through a SIP can be as low as Rs 500 per month.

Which is the best mutual fund ELSS to invest in 2023?

SBI Long Term Equity Fund offered the highest return of around 33.99% in 2023. Motilal Oswal ELSS Tax Saver Fund offered 32.76%. ITI ELSS Tax Saver Fund gave around 31.54%. Bank of India Tax Advantage Fund gave 30.49% in 2023.

Does ELSS come under 80C?

Investments in an ELSS fund are tax deductible under Section 80C of the Income Tax Act of 1961. While there is no upper limit on the amount that can be invested, the IT Act allows for a tax deduction of up to Rs. 1.5 lakh. Investing this amount in an ELSS can result in tax savings of up to 46,800 per year.

Can I invest more than 1.5 lakh in 80C?

There is no maximum limit for investment, but Section 80C deduction is applicable only up to ₹ 1,50,000 (inclusive of other investments and payments). Interest earned is also added back to the initial investment and qualifies for a tax deduction.

Which investment is tax free in India?

The 5-year tax-saving bank fixed deposits as also post-office time deposits offer tax free income. They are one of the best tax free investments in India for individuals with low risk appetite looking to save money over the long-term.

Can I claim both 80C and 80CCC?

As a taxpayer, you can claim deductions under both Section 80C and 80CCC, but the total deduction for both cannot exceed INR 1, 50,000. You can always check your tax calculations with an accountant to ensure you have paid all your taxes and do not attract any fines or defaults.

Are mutual funds under 80C or 80d?

What is ELSS? ELSS is a type of Mutual Fund which allows you to claim for income tax deduction. You can save up to ₹ 1.5 lakhs a year in taxes by investing in ELSS, which is covered under Section 80C of the Income Tax Act, 1961.

Which is better ELSS or mutual fund?

The only major difference between ELSS and mutual funds is the tax deduction and lock-in period. If you are looking for an investment plus tax saving option, ELSS funds can be considered.

Can I invest in both PPF and ELSS?

Both offer tax benefits under Section 80C of the Income Tax Act, but ELSS has a shorter lock-in period of three years, while PPF has a longer lock-in period of 15 years. You can invest in both and diversify your portfolio or opt for the one that suits your profile better.

Are all mutual funds tax deductible?

Mutual funds are not tax-free except for ELSS (equity-linked savings schemes or tax-saving funds) and some retirement funds. As per the Income Tax Act, under Section 80C, you can claim a deduction of up to Rs. 1.5 lakh for investments made in ELSS and can save taxes up to Rs.

Which mutual fund gives tax benefit?

If you want to invest in Mutual Funds for tax benefits, Equity Linked Saving Schemes (ELSS) is the way to go. ELSS funds are well-known for the tax saving benefits they offer. You can currently enjoy benefits on investments for up to INR 1.5 lakh under Section 80C of the Income Tax Act each year with ELSS.

Should I invest in ELSS or PPF?

PPF is suited for individuals who are absolutely risk-averse and can afford a 15-year lock-in period. Whereas those investors who are willing to take a moderate risk to earn higher returns can opt for ELSS. The best way to reduce risk in ELSS to its minimum is by staying invested for the long term.

Does SBI Small Cap Fund come under 80C?

Equity: These Mutual Funds invest mostly in equity stocks (up to 100%). ELSS/Tax saver subcategory within equity allows tax benefits under section 80C of the Income Tax Act and has a lock-in period of 3 years.

Can SIP be shown for tax exemption?

With Systematic Investment Plan (SIP), you can save on your taxes and also get higher returns on your investment. Under Section 80(C) of the Income Tax Act, 1961, investing in Equity Linked Savings Scheme (ELSS) through SIP enables you to claim a deduction of Rs 1.5 lakh from your taxable income.

What is the 3 year lock in mutual funds?

During the three-year lock-in period, no redemption of units or withdrawal of the invested amount is allowed. After the completion of the lock-in period, investors gain the freedom to redeem the units partially or in full.

Which bank is best for ELSS?

How do I know if my mutual fund is tax saver?

An ELSS is a mutual fund class that offers tax deductions under Section 80C of the Income Tax Act, 1961. To check if a fund is an ELSS or not, you need to check for its details on the fund house's website. If you are investing via a third party, the same information will also be available on their website.

Is ELSS taxable after 3 years?

After the 3-year lock-in period, the investor has redeemed the ELSS at Rs 3 lakh where, as per the above criteria, Rs 1.5 lakh will be exempted from tax. Thus, taxable income after deduction of Rs 1.5 lakh from Rs 3 lakh equals Rs 1.5 lakh.

What is the difference between 80C mutual fund and 80C ELSS?

Under ELSS you can claim tax deduction of upto Rs 1.5 lakh as under the section 80C of the Income Tax Act 1961. But with Equity Mutual Funds, you can claim no such deductions.