ELSS Tax Saving Funds: Nowadays, everyone invests and tries to save income tax. How can you save income tax by investing in mutual funds? If any mutual fund category is considered a tax-saving and high-yield return-earning option, it’s the Equity Linked Savings Scheme (ELSS). These funds offer investors tax benefits of up to ₹1.5 lakh under Section 80C under the old tax regime. Furthermore, their lock-in period is only 3 years. Tax-saving FDs only take 5 years, and PPFs take 15 years to reach maturity.
ELSS funds have been generating excellent returns over the past few years, with many categories, such as large-cap and flexi-cap funds, performing exceptionally well. According to reports, this category offers annualized returns of approximately 15.68% over 3 years and 20.12% over 5 years. Let’s explore some ELSS returns.
Motilal Oswal ELSS Tax Saver Fund
This fund was launched in January 2015, and its benchmark is NIFTY 500 TRI. It falls in the “very high risk” category. As of July 2025, this fund has assets under management (AUM) of approximately ₹4,402 crore and an expense ratio of 0.65%. Over the past three years, this fund has achieved a CAGR of 25.38%, while its benchmark has achieved only 14.41%. The five-year CAGR is 25.48%, while the benchmark’s return is only 20.33%. If someone had invested ₹1 lakh three years ago, they would have had approximately ₹1.98 lakh today. And if ₹1 lakh had been invested five years ago, it would have reached approximately ₹3.10 lakh.
SBI ELSS Tax Saver Fund
This fund was launched in January 2013 and has returned 16.31 percent since inception. It benchmarks the BSE 500 TRI and falls in the “very high risk” category. As of July 2025, the fund has an AUM of approximately ₹30,271 crore and an expense ratio of 0.95 percent. Over the past three years, it has achieved a CAGR of 23.42 percent, compared to the benchmark’s 14.41 percent. Over the past five years, the CAGR has been 25.40 percent, compared to the benchmark’s 20.33 percent. Investing ₹1 lakh three years ago would have resulted in approximately ₹1.88 lakh today. Five years ago, the amount would have reached approximately ₹3.10 lakh.
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HDFC ELSS Tax Saver Fund
This fund was also launched in January 2013. Its benchmark is the NIFTY 500 TRI, and it falls in the “very high risk” category. Its AUM as of July 2025 is approximately ₹16,579 crore, and its expense ratio is 1.09 percent. Over the past three years, it has delivered a CAGR of 21.74 percent, compared to the benchmark’s 14.41 percent. Over the past five years, it has achieved a CAGR of 25.14 percent, compared to the benchmark’s 20.33 percent. If someone had invested ₹1 lakh three years ago, it would have become approximately ₹1.84 lakh today. And if they had invested five years ago, it would have reached approximately ₹2.98 lakh today.
Keep these things in mind before investing
Past performance does not guarantee future performance. Returns over three to five years don’t mean they won’t continue in the future. ELSS fund returns depend on market conditions and company performance. It’s crucial to consider your risk profile and financial goals before investing.