BAJAJ ASSET MANAGEMENT LIMITED.
BAJAJ ASSET MANAGEMENT LIMITED.
An Equity Linked Savings Scheme, or ELSS, is an equity mutual fund that invests at least 80% of its assets in equity and equity-related instruments. ELSS investments have a three-year lock-in period, which begins from the date the units are allotted.
If you invest through an SIP, each instalment is treated separately. This means every SIP instalment completes its own three-year lock-in based on its allotment date.
ELSS also comes with a tax-saving benefit for eligible investors under the old tax regime. The tax benefit and the taxation of gains are explained separately below so that the two do not get mixed up.
Source: SEBI Investor, A Guide to ELSS; SEBI, Master Circular for Mutual Funds, 20 March 2026.
An ELSS calculator is an online tool that estimates how an ELSS investment may grow over a selected period. An ELSS mutual fund calculator can be used for both monthly SIP and lumpsum investments by entering the investment amount, investment period and expected annual return.
The calculator then shows the amount invested, estimated returns and projected investment value. You can change the inputs to compare different scenarios instead of calculating each one manually.
Using an ELSS calculator online can also help you understand how the investment period or expected return assumption affects the estimate. Since ELSS returns are market-linked, the actual investment value can differ from the calculator’s projection.
An ELSS investment calculator can make it easier to put numbers around an investment you are considering. You can use it to:
The calculator is an aid, not a prediction tool. It may provide only an indicative picture.
An ELSS return calculator can be useful when you want a quick estimate without working through formulas yourself.
The Bajaj AMC ELSS calculator lets you estimate the potential value and returns of an ELSS investment using either an SIP or a lumpsum.
For example, suppose you plan to invest ₹7,800 every month for five years and assume an annual return of 9%.
You can change the investment amount, expected return or period to compare different scenarios. If you decide to proceed after reviewing the estimate, select Invest Now.
The figures shown are for illustrative purpose only.
The calculator shows four main figures:
The ELSS mutual fund calculator separates these amounts so that you can see how much comes from your investment and how much represents the estimated growth.
ELSS taxation can be understood in two parts: the tax benefit when you invest and the tax treatment when you redeem.
When you invest: Eligible ELSS investments can form part of the annual deduction of up to ₹1.5 lakh available under Section 123 of the Income-tax Act, 2025, subject to the applicable conditions. If you are familiar with Section 80C, Section 123 is the corresponding provision under the new Act from 1 April 2026. The ₹1.5 lakh limit is shared with other eligible investments and payments, so it is not an additional ₹1.5 lakh available only for ELSS. This deduction is not available under the new tax regime under Section 202.
When you redeem: Completing the three-year lock-in does not make ELSS gains automatically tax-free. ELSS is an equity-oriented mutual fund, so qualifying long-term capital gains are taxed under the rules applicable to equity-oriented funds. Under current rules, aggregate eligible long-term capital gains above ₹1.25 lakh in a tax year are taxed at 12.5%, subject to applicable conditions.
The calculator’s Approx Tax Saved figure is therefore only an estimate. Your actual tax benefit can depend on your tax regime, taxable income, other eligible deductions and applicable tax rules.
This also explains how an ELSS tax calculator, ELSS tax benefit calculator or ELSS tax saving calculator should be read. The investment-growth estimate and the tax-saving estimate are related, but they are not the same calculation.
Source: Income Tax Department, Income-tax Act, 2025, Sections 123 and 198; Income Tax Department guidance on the new tax regime.
The tax information in this article is based on prevailing laws at the time of publishing the article and is subject to change. Please consult a tax professional or refer to the latest regulations for up-to-date information.
The calculation depends on whether you invest a lumpsum amount or make regular SIP investments.
How does an ELSS lumpsum calculator work?
An ELSS lumpsum calculator estimates how a one-time investment may grow using the future value formula:
FV = P × (1 + r)ⁿ
Where:
For example, suppose you invest ₹75,000 for five years and assume an annual return of 11%.
FV = ₹75,000 × (1 + 0.11)⁵
The estimated future value would be approximately ₹1,26,379, with an estimated gain of approximately ₹51,379.
The figures shown are for illustrative purpose only
How does an ELSS SIP calculator work?
An ELSS SIP calculator estimates the potential value of regular monthly investments. For SIP instalments assumed to be made at the end of every month, the future value can be estimated using:
FV = P × [((1 + i)ᴺ − 1) / i]
Where:
If the calculation assumes that the SIP is invested at the beginning of each month, the result is adjusted accordingly. This is why SIP estimates can differ slightly depending on the investment date and calculation method.
An additional point matters for ELSS SIPs. Each SIP instalment has its own three-year lock-in period from the date its units are allotted. Starting an SIP does not mean all the units become available for redemption three years after the first instalment.
ELSS does not have a fixed maturity value. In an ELSS maturity calculator, the term “maturity amount” refers to the estimated investment value at the end of the period selected.
To estimate it:
After the three-year lock-in is completed, you are not required to redeem the investment. You may remain invested if that continues to suit your investment objective.
For SIPs, remember that individual instalments become eligible for redemption on different dates because each has its own three-year lock-in.
Suppose Riya wants to invest ₹5,000 each month in ELSS for five years. She enters:
Her total investment over five years would be ₹3 lakh. The calculator then estimates the potential future value based on the 10% annual return assumption.
Riya can change the SIP amount, period or expected return to see how the estimate changes. She should also remember that each ₹5,000 SIP instalment has its own three-year lock-in from its allotment date.
The figures shown are for illustrative purpose only
A few points can help you read the estimate more clearly:
Past performance may or may not be sustained in future
ELSS has a three-year lock-in period from the date units are allotted. For an SIP, each instalment is allotted separately and therefore completes its three-year lock-in on a different date. You do not have to redeem the units once the lock-in ends.
Eligible ELSS investments can form part of the annual deduction of up to ₹1.5 lakh under Section 123 of the Income-tax Act, 2025, subject to applicable conditions. This is the provision corresponding to the earlier Section 80C deduction. The deduction is available under the applicable old tax regime and not under the new tax regime.
Generally, no. ELSS units cannot be redeemed until their three-year lock-in period is completed. For SIPs, this three-year period applies separately to the units allotted through each instalment.
No. ELSS does not have a fixed interest rate because its returns are linked to the performance of the equity and equity-related investments held by the scheme. The expected return entered into an ELSS return calculator is an assumption used to estimate potential investment value, not a fixed rate offered by the fund.
No. ELSS returns are market-linked and are not guaranteed. The value of an ELSS investment can rise or fall depending on the performance of the securities held by the scheme.
The minimum investment amount depends on the ELSS scheme. For the Bajaj Finserv ELSS Tax Saver Fund, the minimum fresh lumpsum investment and SIP amount is currently ₹500, in multiples of ₹500, subject to the scheme terms.
There is generally no tax-rule ceiling on the amount you can invest in an ELSS. However, only eligible investments within the ₹1.5 lakh aggregate annual deduction limit under Section 123 can qualify for the tax deduction, subject to applicable conditions under the old tax regime.
No. Three years is the lock-in period, not a tax-free maturity point. Once eligible ELSS units are redeemed, long-term capital gains tax rules for equity-oriented mutual funds apply. Under current rules, qualifying aggregate long-term capital gains above ₹1.25 lakh in a tax year are taxed at 12.5%, subject to applicable conditions.
ELSS taxation has two parts. An eligible investment may qualify for the annual deduction available under Section 123 under the applicable old tax regime. When units are later redeemed, qualifying long-term capital gains above the aggregate ₹1.25 lakh annual threshold are taxed at 12.5%, subject to applicable conditions.
The tax information in this article is based on prevailing laws at the time of publishing the article and is subject to change. Please consult a tax professional or refer to the latest regulations for up-to-date information.
Call, chat or write to us if you
need investment help
Toll-free number
Write to us at
Investor WhatsApp channel
Share your details and our experts will guide you.
The calculator alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy. This tool is created to explain basic financial / investment related concepts to investors. The tool is created for helping the investor take an informed investment decision and is not an investment process in itself. Bajaj AMC has tied up with AdvisorKhoj for integrating the calculator to the website. Mutual Fund does not provide guaranteed returns. Also, there is no assurance about the accuracy of the calculator. Past performance may or may not be sustained in future, and the same may not provide a basis for comparison with other investments. Investors are advised to seek professional advice from financial, tax and legal advisor before investing in mutual funds.
Need help planning your investments?
Our Investment Philosophy reflects what we, as an organisation, believe will generate a good return on equity investment for our investors in the long term. It dictates our goals and guides decision making.
Alpha (a) is a term used in investing to describe an investment strategy’s ability to beat the market.
Alpha is thus also often referred to as excess return or the abnormal rate of return in relation to a benchmark, when adjusted for risk. Essentially, it means doing better than the crowd without taking disproportionate risk.
Collecting superior information
Analysts and portfolio managers strive to collect superior information about the business and the management of the company. They try to generate superior earnings forecast and the balance strength of the company and the industry, thereby trying to 'beat the market' on information edge. This is an important source of alpha for an investor. However, over the years, retaining the information edge has become more difficult and expensive. With a whole lot of investors trying to collect superior information, how can an investor be sure to continuously have accurate and material information about the companies, ahead of others, all the time?
Processing information better
Even if you don't have material information earlier than the crowd, you can still generate better outcomes if you are able to process this information better. Investors develop models and algorithms with enhanced predictive powers to forecast the next move. Fund managers who invest based on some pure formal analytical models are quantitative managers. Here, the goal is to try and beat other investors based on the sophistication of procedures or analytics. The analytical edge can be quite useful until it gets copied by many, and then it may stop generating superior returns.
Exploiting behavioural biases
As the name suggests, this edge is achieved by superior behaviour in reacting to the inputs available to maximise alpha. Modern finance assumes people behave with extreme rationality. However, researchers in behavioural finance have shown that this is not true. Moreover, these deviations from rationality are often systematic. Behavioural managers try to exploit situations where securities are mispriced by the market because of behavioural factors. At Bajaj AMC, we endeavour to combine the best of these edges.
