ICICI PRUDENTIAL AMC offers 44 Tax Saver Mutual Fund with a total AUM belonging to Rs 607,672 crores as on September 2023 . With the best elss tax saving fund and an investor can claim up to Rs 1.5 lakhs as a tax deduction against their investments under section 80C.
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ICICI Prudential Long Term Equity Fund Tax Saving (Growth) or ELSS is an equity-oriented mutual fund that invests in equity securities listed on the stock exchange. Hence, Tax Saver Mutual Funds are suitable for investors looking for long-term wealth creation and tax saving purposes. This fund is eligible for tax deduction up to Rs 1.5 lakhs under Section 80C of the Income Tax Act, 1961. However, investors must understand that ELSS funds come with a lock-in period of 3 years. Also, tax saving should not be the only reason to invest in ICICI tax saving mutual fund schemes. Moreover, the ICICI tax saving fund is not suitable for investors looking for regular income and liquidity in the form of a zero lock-in period.
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The tax treatment of ICICI Tax Saver Mutual Fund is similar to that of an equity mutual fund. The returns earned on the ICICI Tax Saver fund are taxable at the time of redemption. The taxation of capital gains depends on the period of holding. On the sale of units of ICICI Tax Saver Mutual Fund before 12 months, a short-term capital gain arises. However, STCG is not applicable due to the lock-in period. A long-term capital gain will arise on redemption after 12 months from the date of allocation of these units. As per the law, LTCG of up to Rs 1 lakh is tax exempt. Any LTCG on the ICICI Tax Saving Mutual Fund scheme is taxable at 10% above the exemption limit.
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