ELSS Funds: equity that saves tax

ELSS (Equity Linked Savings Scheme) funds invest mostly in equity and qualify for a deduction of up to ₹1.5 lakh under Section 80C (old tax regime), saving up to ₹46,800/year in the top slab.

• Lock-in: 3 years — the shortest among 80C options (vs 5 for tax-saver FDs, 15 for PPF).
• Returns: equity-linked, so higher potential than PPF/FD over time.
• SIP note: each SIP instalment locks for 3 years from its own date.

Best for investors using the old regime who want growth plus a tax break. Equity taxation on gains.

→ See the best ELSS funds.