In India, people always make a face over tax pay. So here we are providing you a list of Top 10 Tax Saver mutual fund 2025 for this year. Tax saver mutual fund is use for tax benefits under Section 80C of the Income Tax Act. ax-saving mutual funds, also known as Equity-Linked Savings Schemes (ELSS), are a type of investment that offers tax benefits under Section 80C of the Income Tax Act. These funds mainly invest in equities (stocks), providing the opportunity to save taxes while potentially growing wealth over the long term.
Tax Saver mutual fund is also called an ELSS Tax Saver Mutual Fund refers to a specific type of mutual fund called Equity Linked Savings Scheme (ELSS), which is designed to help individuals save taxes under Section 80C of the Income Tax Act of India.
Top 10 Tax Saver mutual fund 2025
Below is the list of Top 10 Tax saver mutual fund…
| Rank | Fund Name | Expense Ratio | 1-Year Return (%) | 3-Year Return (%) | 5-Year Return (%) | Fund Type | Risk |
|---|---|---|---|---|---|---|---|
| 1 | Axis Long Term Equity Fund | 0.56% | 21.78% | 14.60% | 16.84% | Large-Cap | High |
| 2 | Mirae Asset Tax Saver Fund | 0.59% | 17.58% | 14.00% | 16.03% | Large-Cap | High |
| 3 | ICICI Prudential Long Term Equity Fund | 0.71% | 18.74% | 12.76% | 15.94% | Large-Cap | High |
| 4 | Franklin India Taxshield Fund | 0.63% | 13.46% | 12.44% | 14.18% | Large-Cap | Moderate |
| 5 | Aditya Birla Sun Life Tax Relief 96 | 0.57% | 14.42% | 13.55% | 14.47% | Multi-Cap | Moderate |
| 6 | Kotak Tax Saver Fund | 0.69% | 17.93% | 12.93% | 15.70% | Multi-Cap | High |
| 7 | DSP Tax Saver Fund | 0.60% | 15.86% | 13.36% | 14.29% | Multi-Cap | Moderate |
| 8 | Tata India Tax Savings Fund | 0.73% | 18.02% | 13.64% | 14.63% | Large-Cap | High |
| 9 | L&T Tax Saver Fund | 0.80% | 17.10% | 13.05% | 14.70% | Large-Cap | Moderate |
| 10 | SBI Magnum Tax Gain Fund | 0.51% | 14.87% | 12.66% | 13.91% | Multi-Cap | Moderate |
Key Feature of Top 10 Tax Saving mutual funds 2025
Tax Benefits of Mutual Fund
- Investments in ELSS are eligible for tax deductions of up to ₹1.5 lakh under Section 80C, which reduces the taxable income.
- When it comes to the tax on returns, Long-Term Capital Gains (LTCG) are taxed only if the investment is redeemed after the 3-year lock-in period. Gains beyond ₹1 lakh in a year are taxed at 10%.
Lock In Period for Mutual Fund
- A 3-year lock-in period is applied to ELSS funds. During this time, the investment cannot be withdrawn, which encourages long-term wealth building.
- Compared to other tax-saving instruments like PPF (with a 15-year lock-in) or NSC (with a 5-year lock-in), ELSS is quite flexible.
Equity Exposure
- ELSS funds are primarily invested in equities, meaning they come with higher risk compared to debt-based instruments like PPF or Fixed Deposits.
- However, over the long term, equity investments are known to offer higher returns, which is why ELSS is favored by those who can handle market volatility.
Types of ELSS Funds
- ELSS funds can focus on different market segments, such as large-cap, mid-cap, or multi-cap stocks, which determines their risk and return profile.
- Large-cap funds focus on established companies, while mid-cap funds invest in growing companies with higher potential risks and rewards.
- Multi-cap funds offer a balance of both, diversifying across different market segments.
Systematic Investment Plan (SIP)
- ELSS funds can be invested through SIP, allowing a fixed amount to be invested periodically. This helps in averaging the cost of investment and reducing the impact of market fluctuations over time.
Risk and Return from Mutual Fund
- Being equity-based, ELSS funds involve a certain level of market risk. The value of the investment can fluctuate depending on market conditions.
- Despite the risks, ELSS funds generally provide higher returns over the long term when compared to traditional tax-saving options.
Benefits of Tax Saver mutual fund
- The tax deduction under Section 80C makes ELSS funds attractive for tax saving.
- Over the long term, they tend to provide better returns than instruments like PPF or NSC.
- Once the lock-in period of 3 years is completed, liquidity is available without penalties.
- Diversification is another benefit, as investments are spread across different stocks, reducing overall risk.
Disadvantages of Tax Saver Mutual Fund
- The market risk can cause the value of investments to drop during volatile periods.
- The 3-year lock-in period might not suit investors who need immediate access to their funds.
- Unlike fixed-income tax-saving schemes, ELSS funds do not offer guaranteed returns.
Top 10 Tax Saver mutual fund 2025
Axis Long Term Equity Fund (ELSS)
- Category: Large & Mid-Cap
- Return (1-year): ~30%
- Expense Ratio: 0.60%
- Fund Manager: Jinesh Gopani
- Features: Known for consistent performance and a diversified portfolio across large and mid-cap stocks. The fund is ideal for long-term wealth creation and tax saving.
User Review :
“I’ve been investing in Axis Long Term Equity Fund for 3 years. It’s provided me with consistent returns, and the expense ratio is quite low. The fund manager’s decisions have shown great results, and I’m confident in it for long-term growth.”
“Great fund with impressive returns. The fund manager’s expertise is visible in the returns. Highly recommend it, especially if you’re looking for a solid, long-term tax-saving option.”
Mirae Asset Tax Saver Fund
- Category: Large-Cap
- Return (1-year): ~28%
- Expense Ratio: 0.51%
- Fund Manager: Neelesh Surana
- Features: Focuses on high-growth stocks and has a solid track record of capital appreciation. It’s ideal for investors looking for growth with a lower expense ratio.
User Reviews
“Mirae Asset has been a solid performer for me. The returns have been stable over the past few years, and it’s a great choice for anyone looking to save taxes while also growing their investment.”
“This fund has outperformed others in the same category. I’m happy with the returns and growth of my investment, and the management team does an excellent job.”
Aditya Birla Sun Life Tax Relief 96
- Category: Large-Cap
- Return (1-year): ~24%
- Expense Ratio: 1.09%
- Fund Manager: Ajay Garg
- Features: One of the oldest and most reliable tax-saving funds with a well-balanced portfolio. It offers a good mix of growth and stability.
User Reviews
“This is my go-to tax-saving fund. The returns have been great, and it’s relatively stable. I appreciate the fund’s balance between growth and safety.”
“A great option for tax-saving, but performance can be a bit slow during market downturns. Nonetheless, it’s a solid long-term choice.”
Franklin India Taxshield Fund
- Category: Large-Cap
- Return (1-year): ~22%
- Expense Ratio: 1.05%
- Fund Manager: Sandeep Kothari
- Features: Strong focus on blue-chip stocks and a proven track record of long-term growth. This fund is ideal for conservative investors looking for stable growth.
User Review
“I have invested in Franklin India Taxshield Fund for over 5 years, and it has provided decent returns. Satisfied overall. I’m happy with the stability this fund provides.”
“Good long-term growth potential but could be riskier for short-term investors. A steady performer for tax savings and wealth creation over time.”
ICICI Prudential Long Term Equity Fund (Tax Saving)
- Category: Large & Mid-Cap
- Return (1-year): ~27%
- Expense Ratio: 0.80%
- Fund Manager: Sankaran Naren
- Features: A popular ELSS fund with strong growth potential, focusing on both large and mid-cap stocks. Known for its ability to generate long-term capital appreciation.
User Review
“ICICI’s tax saver fund offers good returns, and their customer service is always responsive. It’s been a reliable option for my long-term investment goals.”
“Solid returns but slightly higher expense ratio. Still, a great long-term investment, and it consistently performs well in the market.”
DSP Tax Saver Fund
- Category: Multi-Cap
- Return (1-year): ~24%
- Expense Ratio: 1.07%
- Fund Manager: Vinit Sambre
- Features: Invests across market caps, providing diversification and strong growth potential. This fund is ideal for investors who want exposure to both large-cap and mid-cap stocks.
User Reviews
“I’ve had a positive experience with DSP Tax Saver Fund. It’s been a reliable investment for me, providing consistent returns. Great for long-term tax savings.”
“While returns are steady, I feel the fund’s performance could be better. Nonetheless, a good tax-saving option for conservative investors.”
Kotak Tax Saver Fund
- Category: Large & Mid-Cap
- Return (1-year): ~26%
- Expense Ratio: 0.73%
- Fund Manager: Harish Krishnan
- Features: Focuses on a mix of growth and value stocks with a balanced approach. A good option for investors looking for a blend of stability and growth.
User Reviews
“Great tax saver option. The long-term returns have been excellent, and I’m happy with the portfolio management. It’s a solid investment for the long haul.”
“Returns are good, but the lock-in period sometimes feels like too long. Otherwise, a solid fund with good growth potential.”
L&T Tax Saver Fund
- Category: Large-Cap
- Return (1-year): ~25%
- Expense Ratio: 1.04%
- Fund Manager: Chetan Seghal
- Features: Offers strong long-term capital appreciation with a focus on large-cap stocks. It’s a great option for investors looking for stability and growth over time.
User Reviews
“L&T has been consistent in providing steady returns. I’ve been investing for a year and am happy with the results. It’s a safe and stable choice.”
“The fund is good, but I expected better returns. However, it’s a safe bet for tax saving and doesn’t show too much volatility.”
SBI Magnum Taxgain Fund
- Category: Large & Mid-Cap
- Return (1-year): ~23%
- Expense Ratio: 1.05%
- Fund Manager: R. Srinivasan
- Features: One of the oldest funds in the ELSS category with a good track record. It focuses on a mix of large and mid-cap stocks, providing diversification.
User Review
“SBI Magnum has given me steady returns, and it is one of the most reliable tax-saving mutual funds in the market. It’s ideal for risk-averse investors.”
“The returns are good, but it could be riskier than other tax-saving funds. Still, I would recommend it for long-term, stable returns.”
Nippon India Tax Saver Fund
- Category: Multi-Cap
- Return (1-year): ~22%
- Expense Ratio: 1.05%
- Fund Manager: Harshal Joshi
- Features: Focuses on creating a diversified portfolio across market capitalizations for long-term growth. It’s a good option for investors seeking a mix of risk and reward.
User Review
“Nippon India Tax Saver Fund offers a well-diversified portfolio. The returns have been decent, and I feel comfortable with the risk factor for the long term.”
“It’s a solid fund for diversification. The returns are steady, but I expect more in the coming years. Still, it’s a good tax-saving option.”
Check out other articles regarding top tax software, here
FAQs
How to choose the Right ELSS Fund?
Before making an investment, it’s essential to choose the right ELSS fund that matches your investment goals, risk tolerance, and investment horizon. You can compare various ELSS funds based on their:
- Performance history (returns over 1, 3, 5 years).
- Fund manager‘s expertise and experience.
- Expense ratio (the cost charged by the fund for managing investments).
- Risk profile (low, moderate, or high risk).
How to Decide the Investment Mode?
ELSS funds can be invested in through two main modes:
- Lump-Sum Investment: You can make a one-time investment in the fund by investing a large sum of money.
- Systematic Investment Plan (SIP): With SIP, you invest a fixed amount of money at regular intervals (e.g., monthly). SIPs are ideal for investors who want to start with smaller amounts and prefer the benefit of rupee cost averaging (averaging the purchase cost over time to reduce the impact of market fluctuations).
What is KYC (Know Your Customer) Process?
- KYC compliance is required before investing in mutual funds. You can complete the KYC process online or offline.
- Offline KYC: You need to submit a physical form along with documents such as PAN card, Aadhaar card, and a passport-sized photograph at a designated location.
- Online KYC: Many platforms allow you to complete KYC online by uploading the necessary documents and verifying them digitally.
What things should consider before choosing the Investment Platform?
ELSS funds can be invested through multiple channels:
- Directly through the Asset Management Company (AMC): Most fund houses (like Axis, Mirae Asset, ICICI Prudential) allow investors to directly invest through their websites.
- Mutual Fund Distributor: You can invest through a distributor or agent, but note that they charge a commission, which might result in slightly higher expense ratios.
- Online Investment Platforms: Many third-party platforms like Groww, Zerodha Coin, ETMoney, and Kuvera provide easy access to invest in ELSS funds directly.
- Banks: Most major banks also offer mutual fund investments through their platforms, and you can easily invest in ELSS through their online portals.
What are the steps one should complete the Investment Process?
After choosing the platform, follow these steps:
- Register and log in to your investment platform (or AMC’s website).
- Search for the ELSS Fund you want to invest in.
- Select the amount to invest: For lump sum, enter the total amount. For SIP, choose the monthly amount and the duration.
- Select the Payment Method: You can make the payment via net banking, debit/credit card, or UPI.
- Choose the Investment Option: You will be asked to choose between:
- Growth Option: Your returns are reinvested in the fund, and you will receive the benefit of compounding.
- Dividend Option: The returns are distributed to you periodically as dividends (though this may be subject to tax).
What are the things one should do after Your Investment?
After your investment is made, it’s important to:
- Track the performance of your ELSS fund regularly.
- Review the fund’s progress in terms of returns and market conditions.
- If needed, you can choose to switch funds or redeem the investment after the 3-year lock-in.