| Tax planning has changed radically over a period | | | | The benefit 3 Years lock in period for ELSS |
| of time. Since its time for filling income tax | | | | schemes. |
| returns for 2007-2008 as the end date (31st | | | | Secondly, if you hate blocking your money for |
| March '08) is approaching. As a tax payer you | | | | years on end, then this one surely made for you. |
| need to understand the best way through which | | | | The lock-in period for ELSS funds is just three |
| you can make use of the exemptions provided | | | | years. When you sell after three years, you pay |
| by the government. Earlier people had limited | | | | no capital gains tax. So, you get the tax benefit |
| choice of tax saving instruments to be used for | | | | when investing and you pay no tax on your |
| the purpose of tax planning. But now with the | | | | profits. |
| ELSS (Equity Linked Saving Schemes) launched by | | | | The best way to invest in a mutual fund is |
| most of the mutual fund companies, the whole | | | | investing systematically through out the year |
| approach towards tax saving has changed. With | | | | using SIP. So you commit to putting away a fixed |
| mutual funds tax planning had become more | | | | amount every month in mutual funds. This is an |
| important part of over all investment planning. | | | | automatic savings habit that will hold you in the |
| With equity linked saving schemes the tax | | | | long run and help you not only to save but also |
| exemptions can be used in a manner such that | | | | invest regularly and continuously in the capital |
| you not just disciple your investments but also | | | | market through equity linked saving schemes |
| create good corpus through equity investment. | | | | (ELSS). |
| Tax planning for resident Indians | | | | You need to be consistent in your investments to |
| We recommend tax saving funds, also referred | | | | do well. The wonders which a disciplined |
| to as Equity-Linked Saving Schemes (ELSS). One | | | | investment can do cannot be replicated by even |
| such reason is that their benefits are too much to | | | | the best of investment strategies. |
| ignore as they hold almost all the benefits of an | | | | Want to know about the top mutual funds for |
| equity mutual fund. | | | | Tax Saving? |
| For one, they do not have any restrictions. If you | | | | Most of the Mutual fund companies have come |
| choose to, you can invest the entire Rs 1 lakh | | | | out with tax saving funds. They are Equity Linked |
| available under Section 80C in these ELSS funds. | | | | Saving Schemes (ELSS). The funds collected |
| They give you the benefit of higher returns. You | | | | under this tax saving schemes are invested in |
| can get 8 per cent with your PPF and NSC. But if | | | | equity instrument, thus providing better returns. |
| you can get a 40-50 per cent return, coupled with | | | | Many of these ELSS funds generate as much |
| a tax benefit, what's wrong with it? | | | | returns as a diversified equity fund. With the |
| How do you invest in an ELSS scheme? It is as | | | | awareness been increasing among the investor |
| simple as investing in any other mutual fund | | | | class, the equity linked saving schemes are gaining |
| schemes. You just need to fill the form of | | | | popularity among the investor class. |
| particular ELSS scheme in which you want to | | | | Take step towards informed mutual fund |
| invest. Submit it through any transaction point | | | | investment by investing with care and due |
| with the required document i.e. usually PAN card | | | | diligence. |
| and KYC form. That's it your work is done. | | | | |