What is best ELSS Can tax be saved like this too 2023 ?
What is ELSS.. ? Can tax be saved like this too..? Equity Linked Savings Scheme (ELSS). Its name itself has a complete explanation. It is considered as an ideal fund for long-term investment. It also gets tax benefits. A major portion of the amount invested in this fund is invested in equity in the stock market. If you are in the 30% tax bracket you can save Rs 45,000. Whether it comes to your income or not, you get tax savings through tax savings. This is the reason why many people choose this plan.
How much equity can you invest in?
Also, when the stock markets are good, the returns in this scheme are huge. As far as this ELSS scheme is concerned, 80% can be invested through equity. However, the lock-in period in this scheme is 3 years. Hence no immediate withdrawal is possible in this scheme.
There is also risk
So there should be tax relief. If you also want good income, this ELSS scheme is seen as the best option. Experts are saying that those who want to invest in the stock market should not invest in it without fully knowing about it. If you look at it like that, you can invest in ELSS scheme without investing directly in the stock market. This would be the best way. Profit will also be high. There is an equal amount of risk in this project.
Who is it suitable for?
Usually the funds accumulated in this ELSS fund are invested in the stock market and the returns depend on the ups and downs in the stock market. So those who think we are ready to take risk can invest in it. It is very suitable for investors.
Do not withdraw money
Usually in this scheme they withdraw the money after the profit or loss lock-in period. But you can plan your investment in this scheme depending on the profit you get. Generally investment advisors recommend holding this fund for at least 5 years.
The amount of investment in this scheme is not fixed as the maximum limit. So you can invest as much as you want. Although the investment accumulated in this fund is made in the stock market itself, it is broadly diversified into stocks of various sectors.
What is ELSS Can tax be saved like this too?
Amidst the dual objective of tax-advantaged returns, this fund can also be invested through SIP. So it will be beneficial in the long run. You can invest in this fund as a whole. It also has the facility of topping up in between. So if you have money in hand you can invest in it.
Long term capital gains tax
10% distribution tax is levied on intermittent dividend if dividend option is opted in this scheme. Although there is a tax benefit in this scheme, long-term capital gains tax is levied above Rs 1 lakh. For example, if your income is Rs 1,20,000, you will have to pay 10% LTCG on Rs 20,000 only. So it is good to keep this in mind.