Tax Saving
Comparative Analysis of ELSS with other Instruments u/s 80C
Section 80C of Income Tax Act, 1961, includes the provisions regarding exemption up to Rs.1,50,000 from the total taxable income.
Apart from ELSS, there are several other investments like PPF, LIC, NSC, FD, etc., which provide the same benefit of a tax deduction. But, ELSS is one of the most beneficial instruments as can be seen in the following presentation.
|
Investment Type |
Lock-In Period |
Tax on Interest earned |
Historical Returns | Dividends | Systematic Investing |
|---|---|---|---|---|---|
| ELSS | 3 Years | Exempted | 14%-16% | TAX FREE | Available |
| LIFE INSURANCE | 5 Years | Exempted | 5%-7% | No | Not Available |
| PPF | 15 Years | Exempted | 7.5% – 8.5% | No | Available |
| NSC | 5/10 Years | Taxable | 8.50% | No | Not Available |
| FD | 5 Years | Taxable | 8%-8.50% | No | Not Available |
Tax Benefits of Equity Linked Savings Schemes (ELSS)
Compare the tax benefits you stand to gain under different income brackets by investing in Equity Linked Savings Schemes (ELSS).
|
Your Taxable Income |
Amount invested in ELSS under section 80C |
Tax before ELSS investment |
Tax after ELSS investment | Total Savings* | Tax Slab |
|---|---|---|---|---|---|
| 5,00,000 | 1,50,000 | 13,000 | 5,200 | 7,800 | 5% of Income exceeding Rs.2,50,000 and up to Rs.5,00,000 |
| 8,00,000 | 1,50,000 | 75,400 | 44,200 | 31,200 | 20% of Income exceeding Rs.5,00,000 and up to Rs.10,00,000 |
| 12,00,000 | 1,50,000 | 1,79,400 | 1,32,600 | 46,800 | 30% of Income exceeding Rs.10,00,000 |
| 15,00,000 | 1,50,000 | 2,73,000 | 2,26,200 | 46,800 | 30% of Income exceeding Rs.10,00,000 |
*Including Health and Education cess of 4%
