Tax saving investment options - 3 tax saving instruments you should know about

  • Posted By :
  • Wednesday Mar 13, 2019

You may hate it, you may like it (highly doubtful though) but you cannot ignore it - Your Taxes. Generally, most people remember their taxes only when the deadline is practically visible to the naked eye. And in a quest to save as much as possible at the last minute, many people tend to make the wrong investment decisions. 

Easy Tax Planning - Tax Saving is for everyone

The bad news: You can’t avoid tax. 

But the good news: There are easy tax saving schemes for everyone. 

The Income Tax Act provides an extensive range of options to help reduce your annual tax payments. As a taxpayer, you should be aware of these options so that you can you can take benefit from them. This not only helps you to save money, but it also enables you to create a better financial plan for you and your family.

Tax saving options

1. Public Provident Fund

When it comes to tax saving, Public Provident Fund (PPF) is the most popular investment schemes available for investors. It is a safe investment avenue, since the Indian Government issues it. Each year, you can save up to Rs. 1.5 lakh by investing in PPFs. This comes under Section 80C of the Income Tax Act. However, it is important to note that PPFs come with a lock-in period of 15 years. This means you cannot withdraw your investment amount prematurely from the account.

2. Equity Linked Saving Schemes

PPFs are safe investment avenues, but the returns you earn on the fund are moderate. On the other hand, ELSS is a tax saving mutual fund that has the potential for high returns. As the name suggests, ELSS are mutual funds that invest a significant portion of the amount in equities. This might seem a bit risky but when you invest regularly through Systematic Investment Plans (SIPs) over long-term, your overall risk reduces, and you can benefit from high returns.

Under Section 80C of the Income Tax Act, you can earn tax deductions on investments up to Rs. 1.5 lakh per annum. Also, ELSS funds come with a lock-in period of just three years. This is much lesser than most other tax saving options available to you. This means you have the freedom to move your funds more efficiently based on your financial requirements.

3. Unit Linked Insurance Plans (ULIPs)

Unit Linked Insurance Plans or ULIPs are a unique investment product because, in addition to life insurance and investment benefits, they also offer tax benefits. Every year, you can avail a tax deduction of Rs. 1.5 lakh under Section 80C on the premium you have paid on ULIPs, during the year. Moreover, in case of death of the policyholder, the amount paid to beneficiaries is not taxable either, under Section 10(10D) of the Income Tax Act.


When you work hard at your job, every rupee earned is accountable. These quick and easy tax-planning options can help you save a substantial amount in tax planning each year. Invest through to take advantage of the RoboAssist feature for better investment options.





Lock in period

15 years

3 years

5 years

Investment limit

Rs. 1.5 lakh/year

Rs. 1.5 lakh/year

Rs. 1.5 lakh/year

Minimum investment

Rs. 500/year

Rs. 500/month

Around Rs. 2,000 per month [i]




11-13% [ii]






Quick Investment Options for Tax Saving -

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