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)
Tata India Tax Savings FundEquityModerately High-4.7%5star1,919
Axis Long Term Equity FundEquityModerately High-4.2%5star20,425
Mirae Asset Tax Saver FundEquityModerately High-3.3%5star2,465
Motilal Oswal Long Term Equity FundEquityModerately High-10.5%5star1,500
Kotak Tax Saver FundEquityModerately High-3.8%5star947
Canara Robeco Equity Tax SaverEquityModerately High-8.2%4star965
DSP BlackRock Tax Saver FundEquityModerately High-4.2%4star5,841
Invesco India Tax PlanEquityModerately High-10.6%4star912
Aditya Birla Sun Life Tax Relief 96EquityModerately High-13.3%4star9,129
IDFC Tax Advantage (ELSS) FundEquityModerately High-13.6%4star1,994
JM Tax Gain FundEquityModerately High-6.1%4star33
Principal Tax Savings FundEquityHigh-14.0%3star389
Essel Long Term Advantage FundEquityModerately High-7.6%3star58
IDBI Equity Advantage FundEquityModerately High-9.9%3star589
Edelweiss Long Term Equity Fund (Tax Savings)EquityModerately High-8.6%3star107
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.

Tata India Tax Savings Fund Direct Growth

Fund Performance: This fund has given 8.76% annualized returns in the last three years. In the last year, its returns were -4.73%. 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 -4.73% 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
AUM1,919Cr
1Y Returns-4.7%

Axis Long Term Equity Direct Plan Growth

Fund Performance: This fund has given 10.73% annualized returns in the last three years. In the last year, its returns were -4.22%. 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 -4.22% 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
AUM20,425Cr
1Y Returns-4.2%

Mirae Asset Tax Saver Fund Direct Growth

Fund Performance: This fund has given 14.1% annualized returns in the last three years. In the last year, its returns were -3.33%. 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 -3.33% 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 ₹500.

Min Investment Amt₹500
AUM2,465Cr
1Y Returns-3.3%

Motilal Oswal Long Term Equity Fund Direct Growth

Fund Performance: This fund has given 9.91% annualized returns in the last three years. In the last year, its returns were -10.54%. 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 -10.54% 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
AUM1,500Cr
1Y Returns-10.5%

Kotak Tax Saver Fund Direct Growth

Fund Performance: This fund has given 8.7% annualized returns in the last three years. In the last year, its returns were -3.77%. 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 -3.77% 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
AUM947Cr
1Y Returns-3.8%

Canara Robeco Equity Tax Saver Direct Growth

Fund Performance: This fund has given 8.69% annualized returns in the last three years. In the last year, its returns were -8.19%. 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 -8.19% 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
AUM965Cr
1Y Returns-8.2%

DSP Tax Saver Direct Plan Growth

Fund Performance: This fund has given 8.18% annualized returns in the last three years. In the last year, its returns were -4.16%. 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 -4.16% 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
AUM5,841Cr
1Y Returns-4.2%

Invesco India Tax Plan Direct Growth

Fund Performance: This fund has given 8.61% annualized returns in the last three years. In the last year, its returns were -10.55%. 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 -10.55% 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
AUM912Cr
1Y Returns-10.6%

Aditya Birla Sun Life Tax Relief 96 Direct Growth

Fund Performance: This fund has given 7.21% annualized returns in the last three years. In the last year, its returns were -13.28%. 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 -13.28% 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
AUM9,129Cr
1Y Returns-13.3%

IDFC Tax Advantage (ELSS) Direct Plan Growth

Fund Performance: This fund has given 7.64% annualized returns in the last three years. In the last year, its returns were -13.63%. 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 -13.63% 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
AUM1,994Cr
1Y Returns-13.6%

JM Tax Gain Direct Plan Growth

Fund Performance: This fund has given 9.86% annualized returns in the last three years. In the last year, its returns were -6.09%. 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 -6.09% 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
AUM33Cr
1Y Returns-6.1%

Principal Tax Savings Fund Direct

Fund Performance: This fund has given 6.65% annualized returns in the last three years. In the last year, its returns were -13.98%. 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 -13.98% 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
AUM389Cr
1Y Returns-14.0%

Essel Long Term Advantage Fund Direct Growth

Fund Performance: This fund has given 6.78% annualized returns in the last three years. In the last year, its returns were -7.56%. 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 -7.56% 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
AUM58Cr
1Y Returns-7.6%

IDBI Equity Advantage Fund Direct Growth

Fund Performance: This fund has given 6.41% annualized returns in the last three years. In the last year, its returns were -9.94%. 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 -9.94% 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
AUM589Cr
1Y Returns-9.9%

Edelweiss Long Term Equity Fund (Tax Savings) Direct Growth

Fund Performance: This fund has given 5.63% annualized returns in the last three years. In the last year, its returns were -8.58%. 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 -8.58% 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
AUM107Cr
1Y Returns-8.6%

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