ELSS Query

[rockstar1982]

I have just closed down my ICICI Ulip Scheme. I now want to start some elss mutual fund for tax saving. But since it is declared tht govt will stop giving tax benefit after 2012 is it advisable to invest in an elss scheme.

Also elss has three year lock in period. So if i invest will i get the benefit for all the three year that i am invested in or only for 2011-2012.

 

[Pallavi.satya]

The Investments Done in ELSS will be considered for that year Tax Exemption (Under 80C) only. The locking will be for 3 years, means you can redeem them after 3 years only.

DTC may come into effect from next year. You can invest in ELSS in the current Year.

Happy Investing................:thumb:

 

[rockstar1982]

My problem is if i invest now i will get tax benefit for only one year where as the lock in period will be for 3 yrs. So my question is should i go for it and get my money locked for the next 3 yrs and get tax benefit for only 1 year.

 

[Pallavi.satya]

Yaa, This will be best option in the market. If you go for PPF (16 Years Blocked), NSC (6 Year Blocked), etc.
ELSS funds are a bit better. They are only 3 years locked.

 

[rockstar1982]

Yaa, This will be best option in the market. If you go for PPF (16 Years Blocked), NSC (6 Year Blocked), etc.
ELSS funds are a bit better. They are only 3 years locked.

You are right, but it seems like i will pay for 3 years and get benefit for only one year. Plus the amount that i will pay will remain locked for 3 yrs.

 

[Pallavi.satya]

Sorry, My explanation is not upto the mark for my previous replys.
Let be explain in detail.....
If you start invest in ELSS on Monthly basis from this month and Continue to invest till 31st March 2012, and stop the SIP. Because DTC will get activated from the above said date. Then the investments of ELSS will not be entertained. Now the Amount you invested in ELSS will be eligible for redemption after 3 years from your last SIP payment. (31st March 2015)

 

[rockstar1982]

Sorry, My explanation is not upto the mark for my previous replys.
Let be explain in detail.....
If you start invest in ELSS on Monthly basis from this month and Continue to invest till 31st March 2012, and stop the SIP. Because DTC will get activated from the above said date. Then the investments of ELSS will not be entertained. Now the Amount you invested in ELSS will be eligible for redemption after 3 years from your last SIP payment. (31st March 2015)

I did not get your point "Now the Amount you invested in ELSS will be eligible for redemption after 3 years from your last SIP payment. (31st March 2015)"