Everybody likes to make money. And what could be a better way than making it through savings. The Income Tax Act allows every individual to save his had-earned money while filing his income tax return under section 80. There are various ways to save you're your money by investing in plenty of tax saver funds and insurance policies. An investment in certain mutual funds also increases your money growth by more than 50 percent in a short span of time. The tax benefit under Section 80 of the Income Tax Act that any individual can avail is an added advantage.
Investment in ELSS Mutual Funds is also considered to be one of the best options available in the market owing to its low expense and short lock-in period of 3 years. These funds also have high liquidity and high growth in long-term.
Top five tax saver funds are as follows:
• SBI Magnum Tax gain: the number one position for the best mutual fund of the year has been bagged by SBI Magnum Tax gain. It has managed to remain the second best in terms of safety and return with standard deviation of 22.13. The fund has beaten its nearest rivals including HDFC in terms of performance by big margin. The Taxsaver fund has Reliance Industries, JP Associates, Welspun Gijarat, Reliance Communications and L&T as its major holdings with Avg mkt cap of above 27000 crore and with equity to debt mix of 88:12. The fund is highly beneficial for claiming tax benefits under section 80C of the Income Tax Act owing to its excellent safety in terms of low risk.
• HDFC Long term Advantage Fund: HDFC Long term Advantage fund has emerged as the star performer from the HDFC stable. Its top holdings include names like ICICI Bank, Reliance Industries, SBI and Crompton Greaves, Blue Star. The fund as got so much of publicity as investors are now realizing that safety of investment is as important as the return. For individuals who place safety as the utmost important factor, HDFC Long term Advantage fund offers the best place to invest.
• HDFC Tax Saver: The fund is considered second best in terms of five year return however scores poorly on one year return. It has been given 4th position for risk factor. The fund has top holdings in Basic Engineering, Financial Services and Energy Sector with Avg mkt capitalization of Rs 23204 crore. The top five holdings include ICICI bank, L&T, ITC, Crompton greaves and Reliance Industries.
• Birla Equity: this Tax Saver Fund is considered to be a new entrant in the list of tax saving schemes. Birla Equity offers excellent returns from all parameters however it come with comparatively high risk. The top holdings of this fund include name like TRF, ABB, Gammon India, Welspun Gujarat and Goodyear India.
• Franklin India Taxshield: This Tax Saver fund is known for its excellent Risk Rating. It has above 35,000 crore Avg mkt capitalization. The top holdings of this fund include ICICI Bank, Reliance Industries, HDFC, L&T AND Bharti Airtel.
Tags: added advantage, liquidity, insurance policies, standard deviation, income tax return, tax benefit, crore, hdfc, reliance industries, income tax act