ELSS Tax Saving Funds: Save Up to ₹46,800 (Old Regime)

An Equity Linked Savings Scheme (ELSS) must keep at least 80% of its money in equities. Its tax benefit is only available under the old tax regime, which is now something you must choose, since the new regime became the default from FY 2023-24.

How much tax can ELSS save?

Try your numbers in the ELSS Tax Saving Calculator.

How does the lock-in work for SIPs?

Each instalment is locked for 3 years from its own date. A SIP started in January 2026 means the January 2026 instalment unlocks in January 2029, the February one in February 2029, and so on. To exit completely, you wait 3 years after your last instalment.

How are ELSS gains taxed?

As with other equity funds, as of FY 2026-27: long-term gains above ₹1.25 lakh a year are taxed at 12.5%. Because of the lock-in, ELSS gains are always long-term. See how this works.

Does ELSS make sense for me?

• On the new regime? There is no deduction, so choose funds on merit. There is no tax on income up to ₹12 lakh (₹12.75 lakh for salaried people), so many people need no tax-saving investment at all.
• On the old regime? Check first how much of the ₹1.5 lakh your EPF, life insurance and home loan principal already use.
• Comfortable with equity? ELSS can fall in value like any equity fund, and the 3-year lock-in is a minimum rather than a recommended holding period.

Avoid rushing in during March. Starting a SIP in April spreads your entry and spares you the last-minute decision. Rules can change, so check with a tax professional before deciding.