ELSS Calculator
ELSS Calculator
Equity SIP with 3-year lock-in + §80C tax savingYour tax slab (old regime)
§80C deduction works only in the old tax regime. New regime ignores §80C — the tax-saved number would be zero.
Maturity Value
₹4.12 L
+₹1.12 L returns over 5 years
Total Invested
₹3 L
Tax Saved (Total)
₹90,000
LTCG on Exit
₹0
Net After LTCG
₹4.12 L
Year-by-year projection · ₹5,000/mo · 5 yr · 12% return · 30% slab
Year | Total Invested (₹) | Tax Saved (₹) | Maturity (₹) |
|---|---|---|---|
2027 | 60,000 | 18,000 | 64,047 |
2028 | 1.2 Lakhs | 36,000 | 1.36 Lakhs |
2029 | 1.8 Lakhs | 54,000 | 2.18 Lakhs |
2030 | 2.4 Lakhs | 72,000 | 3.09 Lakhs |
2031 | 3 Lakhs | 90,000 | 4.12 Lakhs |
What ELSS is, and why people pick it
An Equity Linked Savings Scheme (ELSS) is a category of equity mutual fund that invests at least 80% of its corpus in equities and qualifies for tax deduction under §80C of the Income Tax Act. It carries the shortest mandatory lock-in among §80C options (3 years vs PPF's 15, NSC's 5, tax-saver FD's 5), and historically has delivered the highest long-term return — though with full equity-market volatility along the way.
The 3-year rolling lock-in
Each SIP installment has its own 3-year clock from the date it was invested. April 2026's installment unlocks in April 2029; May 2026's in May 2029; and so on. There's no single "lock-in expiry date" for the SIP as a whole — units mature on a rolling basis. Lump-sum investments are simpler: the full amount unlocks 3 years from the investment date.
Tax saving under §80C (old regime only)
ELSS contributions up to ₹1.5 lakh per financial year are deductible under §80C. The cap is shared with PPF, EPF, NSC, life insurance premiums, tax-saver FDs, home loan principal, and other §80C instruments — ELSS isn't an additional ₹1.5 lakh on top, it's one option inside that bucket. At the 30% slab, ₹1.5 lakh in ELSS saves ₹46,800 in tax (including 4% cess).
The new tax regime does not allow §80C deductions — if you're in the new regime, ELSS offers no tax-saving angle. The 3-year lock-in becomes a cost without a benefit; regular equity funds do the same job with no lock-in.
Tax at exit — LTCG
After the lock-in, redemption triggers long-term capital gains (the holding period is automatically >12 months because of the 3-year lock-in). LTCG on equity funds is taxed at 12.5% on gains above ₹1.25 lakh per financial year (Budget 2024 rate, applicable from 23 July 2024).
The ₹1.25 lakh exemption resets every FY. So staggering redemptions across multiple financial years can reduce or eliminate LTCG entirely — if your annual equity gains stay under the exemption threshold, you owe nothing.
ELSS vs PPF — picking inside §80C
- PPF: guaranteed 7.10% (Q1 FY 26-27), 15-year lock-in, fully tax-free (EEE), no market risk.
- ELSS: market-linked (historical 10–14% on diversified equity funds), 3-year rolling lock-in, LTCG of 12.5% above ₹1.25 lakh/yr.
The common pattern: max PPF for the certainty floor (it's also useful as a low-risk anchor in the overall portfolio), then top up §80C with ELSS for equity exposure and shorter lock-in. Inside the old regime, splitting between the two diversifies both risk and liquidity.
What to look for in a fund
- 5+ year track record (one full market cycle is the minimum honest sample).
- AUM above ₹1,000 cr — large enough that impact-cost on trades is low.
- Direct plan expense ratio under 1.5% (regular plans add 0.5–1% in distribution fees).
- Consistent quartile ranking in its peer group over rolling 3-year windows.
Diversify across 1–2 funds rather than concentrating in one — past returns don't guarantee future ones.
§80C cap and LTCG rates verified 2026-05-28 against the Income Tax Act and Finance Act 2024. ELSS returns are market-linked and not guaranteed.
FAQs
ELSS — Equity Linked Savings Scheme — is a category of mutual fund that invests at least 80% of its corpus in equities and qualifies for §80C tax deduction up to ₹1.5 lakh per financial year. Each installment is locked in for 3 years (the shortest lock-in among §80C options). Returns are market-linked, not guaranteed.
Each SIP installment has its OWN 3-year clock from the date it was invested. If you start a SIP in April 2026, the April installment unlocks in April 2029; the May installment unlocks in May 2029, and so on. There's no single "lock-in expiry date" for the full investment — units mature on a rolling basis.
You save (your slab rate × amount invested), capped by the §80C limit of ₹1.5 lakh per year. The §80C limit is shared across PPF, EPF, ELSS, life insurance, NSC, tax-saver FD, home loan principal, and other instruments — ELSS is just one option in that bucket. At the 30% slab, ₹1.5 lakh in ELSS saves ₹46,800 in tax (including 4% cess). At the 20% slab, it saves ₹31,200. At 10%, ₹15,600.
No — the new regime removes §80C entirely, so ELSS contributions don't reduce taxable income. You can still invest in ELSS for the long-term equity exposure and 3-year lock-in discipline, but the tax-saving angle disappears. For new-regime taxpayers, ELSS competes with regular equity mutual funds purely on returns; without the §80C kicker, the 3-year lock-in becomes a cost rather than a feature.
Long-term capital gains apply because the holding period exceeds 12 months. The first ₹1.25 lakh of LTCG from equity in a financial year is exempt. Anything above that is taxed at 12.5% (Budget 2024 rate, applicable from 23 July 2024 onwards). This calculator shows the LTCG payable assuming one redemption at maturity — in practice, you can stagger redemptions across financial years to use the ₹1.25 lakh exemption multiple times.
PPF: guaranteed 7.10% (Q1 FY 26-27), 15-year lock-in, returns are tax-free (EEE). ELSS: market-linked (historical 10–14% on equity funds), 3-year lock-in per installment, LTCG of 12.5% above ₹1.25 lakh/yr. ELSS wins on potential return and liquidity; PPF wins on certainty and EEE tax treatment. Most planners suggest mixing both: max out PPF for the floor, top up with ELSS for the equity exposure inside the §80C bucket.
SIP is the standard recommendation for equity exposure — it spreads the cost basis across market cycles and prevents bad timing. It also lets you spread the §80C investment across 12 months instead of scrambling in March. Lump sum can work if you have a large tax-saving deadline gap and the market is correcting, but most years rupee-cost-averaging is the safer choice. This calculator assumes monthly SIP.
Indian equity-fund 10-year rolling returns have typically ranged 10–14%. 12% is a commonly used planning assumption and is what most ELSS calculators default to. Aggressive funds may have done better historically; conservative balanced funds may do worse. Treat the calculator output as a planning estimate, not a forecast.
Yes. ELSS SIPs can be paused, modified, or stopped without penalty. The units already invested remain locked for their 3-year clock; you just stop adding new ones. To redeem units before the 3-year lock-in expires, you can't — the AMC will reject the redemption request. This is true even in emergencies; ELSS lock-in is hard, unlike PPF's partial-withdrawal allowance.
This calculator doesn't recommend specific funds. General guidance: pick a fund with a 5+ year track record, AUM above ₹1,000 cr (so impact-cost is low), an expense ratio under 2% (direct plan), and consistent ranking in its peer group over rolling 3-year periods. Past returns don't guarantee future ones — diversifying across 1–2 funds rather than concentrating in one is sensible.