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Best Tax Saving Investment options

Tax Saving Investment

January is started and it’s time to submit your Tax saving proof for FY 2015 to your employer. If you have already planned in advance about tax saving you must be relaxed. However if you have not made any investment for tax saving purpose you must be wondering what to do now? In order to help you out, I am here with the detail of Best Tax Saving Investment options.

Best Tax Saving Investment options


 ELSS or Equity Linked saving scheme is the best tax saving investment option. ELSS is nothing but tax saving mutual funds. ELSS can provide a return in the range of 12-15%. ELSS comes with three years lock in period. You need to be careful in selecting ELSS mutual funds. In order to help you out here is Best ELSS Funds for Investment in 2016.  You can claim 80 C Income tax benefit by investing in ELSS.



NPS is next in the list of best tax saving investment options. NPS stands for National Pension Scheme. NPS returns are market linked. NPS allows an investor to select a fund based on the level of safety and risk. NPS can provide a return in the range of 9-10%. You can claim 80 C income tax benefit by investing in NPS. If your 80C limit of 1.5 lac is exhausted you can invest 50,000 Rs in NPS and take additional benefit of 80 CCD.

Also Read – Tax Saving & Tax Planning at Last Minute

Sukanay Samriddhi Scheme

 Sukanya Samriddhi Scheme is also one of the best tax saving investment options. Sukanya Samriddhi Account can be opened on the name of girl child only. Sukanya Samriddhi Account offers fix 9.3% return. Maturity amount under this scheme is also tax exempted.  You can claim 80 C Income tax benefit by investing in Sukanya Scheme. If you want to calculate returns you can download Sukanya Samirddhi Account calculator from here.

Senior Citizen Saving Scheme

Senior Citizen Saving Scheme is for senior citizens. SCSS offers fix 9.3% return.  It is one of the safest investment options. SCSS account can be opened by senior citizen for the tenure of 5 years. TDS is applicable on maturity amount under this scheme.


ULIP or Unit Linked Insurance Plan is a product offered by an insurance company that provide the dual benefit of insurance and investment under a single umbrella. ULIP returns are variable and depend upon market condition. Investment in ULIP can be claimed under section 80 C. You need to carry out good amount of research before investing in ULIP.


Public Provident Fund is next in the row of best tax saving investment options. You can open PPF account in any authorized bank. The rate of return for investment in PPF is 8.7%. Lock in period for PPF is 15 years. PPF falls under EEE category. You can save tax and also enjoy tax-free maturity benefit by investing in PPF.

Also Read – Tax Saving Instrument Flowchart

Tax Saving FD

Tax Saving FD is one of the safest ways to invest money. This option is advisable for conservative investors only.  Tax saving FD offers return in the range of 6-8% depending upon your tax slab. Lock in period of tax saving FD is 5 years. You can claim 80 C income tax benefit by investing in Tax saving FD.

Apart from above tax saving option, you can also opt for tax saving instruments like life insurance, PF, NSC, Home loan principal, school fees of children under 80C (1.5 Lakh Limit). Other options of saving tax are Mediclaim under 80 D, Education loan under 80 E, Donation under 80 G and Home loan interest payment under section 24.

For more information refer to Following Tax saving Investment Infographic.

Tax Saving Investment

 Hope you find above information about Best Tax Saving Investment useful. Do share your views on tax saving investment options.

Shitanshu Kapadia
Shitanshu Kapadia
Hi, I am Shitanshu founder of moneyexcel.com. I am engaged in blogging & Digital Marketing for 10 years. The purpose of this blog is to share my experience, knowledge and help people in managing money. Please note that the views expressed on this Blog are clarifications meant for reference and guidance of the readers to explore further on the topics. These should not be construed as investment , tax, financial advice or legal opinion. Please consult a qualified financial planner and do your own due diligence before making any investment decision.