ELSS Calculator Tax Saving Mutual Fund Returns
🎯 Save Tax + Build Wealth + Beat Inflation
Calculate your ELSS returns, compare with FD & PPF, and discover how you can save up to ₹46,800 in taxes while building a wealth corpus with market-linked returns of 12-15% annually!
3 Years
₹1.5L u/s 80C
12-15% p.a.
Calculate ELSS Returns
Typical ELSS returns: 12-15% p.a. (historically)
Minimum lock-in period: 3 years
💡 Pro Tip: Start with a small SIP of ₹1,000-5,000 per month to get comfortable with equity investments while enjoying tax benefits!
✨ Why ELSS is the SMARTEST Tax-Saving Option ✨
Highest Returns
ELSS typically delivers 12-15% annual returns, beating FD (6.5%) and PPF (7.1%) by a huge margin!
Shortest Lock-in
Just 3 years lock-in vs 5 years for tax-saving FD and 15 years for PPF. Get your money faster!
Dual Benefit
Save up to ₹46,800 in tax under Section 80C AND grow wealth with equity market returns!
Understanding ELSS (Equity Linked Savings Scheme)
ELSS or Equity Linked Savings Scheme is a type of mutual fund that not only helps you save taxes but also offers the potential for wealth creation through equity investments. It's one of the most popular tax-saving instruments under Section 80C of the Income Tax Act, allowing you to claim a deduction of up to ₹1.5 lakh annually.
What is ELSS?
- Tax-saving mutual fund that invests primarily in equity markets
- Provides tax deduction under Section 80C (up to ₹1.5 lakh)
- Shortest lock-in period among tax-saving instruments (3 years)
- Long-term capital gains (LTCG) above ₹1 lakh taxed at 10%
Key Features
- Minimum: ₹500 per month (SIP), No minimum for lumpsum
- Lock-in Period: 3 years (mandatory holding period)
- Expected Return: 12-15% p.a. (market-linked, historically)
- Available as both SIP (monthly) and lumpsum investment
🌟 Why Our ELSS Calculator Stands Out
Most calculators just show returns. We help you make SMART decisions!
Real-time Comparison
Compare ELSS with FD and PPF side-by-side with interactive charts and detailed breakdowns
Tax Savings Calculator
Automatically calculates Section 80C tax savings based on your income tax slab
SIP + Lumpsum Both
Calculate returns for monthly SIP and one-time lumpsum investments with one tool
Visual Growth Charts
Interactive charts showing year-by-year wealth growth and investment breakdown
Educational Content
Comprehensive guides, comparisons, and FAQs to make informed investment decisions
Net Gain Analysis
Shows total net benefit including investment returns AND Section 80C tax savings
❓ Frequently Asked Questions (FAQs)
1. What is ELSS and how does it work?
ELSS (Equity Linked Savings Scheme) is a type of mutual fund that primarily invests in equity markets. It offers tax deduction under Section 80C up to ₹1.5 lakh per year and has the shortest lock-in period of 3 years among all tax-saving instruments. It works by investing your money in diversified equity portfolios, potentially delivering 12-15% annual returns over the long term.
2. Is ELSS better than PPF or Fixed Deposit for tax saving?
ELSS typically offers higher returns (12-15%) compared to PPF (7.1%) and FD (6-7%), making it better for wealth creation. However, ELSS carries market risk while PPF and FD are risk-free. For young investors with 5+ year time horizon, ELSS is generally better due to higher returns and shorter lock-in (3 years vs 5 years for FD and 15 years for PPF). For risk-averse investors, PPF might be more suitable.
3. How much tax can I save by investing in ELSS?
You can save up to ₹46,800 in taxes (in 30% tax bracket) by investing ₹1,50,000 per year in ELSS under Section 80C. The exact savings depend on your tax slab: 0% slab = ₹0 saved, 5% slab = ₹7,500 saved, 20% slab = ₹30,000 saved, 30% slab = ₹46,800 saved (including cess). Additionally, LTCG up to ₹1 lakh per year are tax-free!
4. Can I withdraw my ELSS investment before 3 years?
No, ELSS has a mandatory lock-in period of 3 years. You cannot withdraw or redeem your investment before completing 3 years from the date of investment. For SIP investments, each monthly installment has its own separate 3-year lock-in period. However, after 3 years, you can redeem anytime without penalties.
5. Should I invest in ELSS through SIP or lumpsum?
SIP (Systematic Investment Plan) is generally better for most investors as it averages out market volatility through rupee cost averaging and doesn't require a large amount upfront. You can start with as low as ₹500 per month. Lumpsum is suitable if you have a large amount available and markets are at attractive valuations.
6. What are the tax implications on ELSS returns?
ELSS investments get tax deduction under Section 80C (up to ₹1.5L). After 3 years, Long-Term Capital Gains (LTCG) up to ₹1 lakh per financial year are completely tax-free. LTCG above ₹1 lakh are taxed at 10% without indexation benefit. This makes ELSS very tax-efficient!
7. What is the minimum and maximum investment in ELSS?
For SIP, the minimum is typically ₹500 per month (varies by fund). For lumpsum, it can be as low as ₹500. There is no maximum limit, but tax deduction under Section 80C is capped at ₹1,50,000 per financial year. Most investors optimize by investing ₹1.5L to maximize both returns and tax savings.
8. How do I choose the best ELSS fund?
Look for: (1) Consistent performance over 5-10 years, (2) Low expense ratio (below 2%), (3) Fund size (larger is generally more stable), (4) Fund manager's track record, (5) Investment philosophy, and (6) Ratings from agencies like Morningstar. Don't chase past returns. Consider 3-4 good funds for diversification.
9. What happens if the stock market crashes? Will I lose money?
ELSS invests in equities, so portfolio value will decline during crashes. However, historically, equity markets have always recovered and delivered strong returns over 5-7 year periods. The 3-year lock-in prevents panic selling. Over 10+ years, ELSS historically has delivered 12-15% returns despite multiple crashes. This is why ELSS is for long-term wealth creation.
10. Can NRIs invest in ELSS?
Yes, NRIs (Non-Resident Indians) can invest in ELSS mutual funds in India. However, they cannot claim tax deduction under Section 80C as that benefit is only for resident Indians. NRIs still benefit from the potential high returns (12-15%). The 3-year lock-in and LTCG tax rules apply the same way. NRIs should consult tax advisors regarding implications in both India and their country of residence.
Disclaimer
This calculator provides estimates based on the inputs provided and assumes constant returns, which may not reflect actual market performance. ELSS investments are subject to market risks and returns are not guaranteed. Past performance is not indicative of future results. The tax savings shown are indicative and actual tax liability should be calculated as per applicable Income Tax laws. Please read all scheme-related documents carefully before investing. Consult with a qualified financial advisor for personalized investment advice. This tool is for educational and informational purposes only and should not be considered as investment advice.