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Best ELSS Mutual Funds 2025 are among the most powerful tax-saving and wealth-building options available to Indian investors. At the beginning of this year, several schemes underperformed market expectations, but over the past five years, top ELSS funds have delivered over 20% annualised returns. Our research, verified using AMFI and fund houses’ official factsheets, provides accurate details of both Regular Plans and Direct Plans.
Top 10 Best ELSS Mutual Funds (5-Year Annualised Returns – Regular vs Direct)
| ELSS Scheme | 5-Year Return (Regular Plan, Rolling) |
|---|---|
| Quant ELSS Tax Saver Fund – Regular | 27.33% |
| Motilal Oswal ELSS Tax Saver Fund – Regular | 25.68% |
| HDFC ELSS Tax Saver – Growth | 25.08% |
| SBI ELSS Tax Saver – Regular Plan | 25.08% |
| Franklin India ELSS Tax Saver – Growth | 24.15% |
| Bandhan ELSS Tax Saver – Regular Growth | 23.66% |
| Nippon India ELSS Tax Saver – Growth | 23.58% |
| DSP ELSS Tax Saver – Regular Growth | 23.42% |
| Bank of India ELSS Tax Saver – Growth | 22.34% |
| Parag Parikh ELSS Tax Saver – Regular Growth | 22.03% |
These values reflect rolling returns ending Q3 of 2025, offering a robust picture of fund consistency and performance.
Key Insights on Best ELSS Mutual Funds
- Motilal Oswal ELSS and HDFC ELSS lead the list, consistently delivering strong returns in both Regular and Direct Plans.
- DSP, BOI, Kotak, Mirae Asset, and Canara Robeco ELSS provide healthy 20–24% returns in Regular Plans.
- ICICI Prudential ELSS shows one of the widest performance gaps between Regular (~20.5%) and Direct (~25–26%) plans.
- Direct Plans outperform Regular Plans by 1–2% annually due to lower expense ratios.
Why Best ELSS Mutual Funds Are Attractive in 2025
- Tax Benefit: Investments up to ₹1.5 lakh qualify for deductions under Section 80C of the Income Tax Act.
- Shortest Lock-in: Just 3 years, compared to 5 years for tax-saving FDs and 15 years for PPF.
- Wealth Creation: Market-linked growth makes ELSS funds a powerful option for long-term investors.
How to Choose the Best ELSS Mutual Fund
- Direct Plan vs Regular Plan: Direct offers higher returns by cutting distributor fees. Choose Regular if you prefer advisor guidance.
- Fund Consistency: Look for funds with stable 5-year or 10-year performance rather than chasing short-term winners.
- Risk Profile Alignment: Equity-linked schemes carry market risks—ensure they match your financial goals and risk appetite.
Things to Consider Before Investing in ELSS Funds
- Market Risks: Returns depend on equity market performance.
- Fund Selection: Always check long-term track record and consistency.
- Investment Horizon: ELSS is suitable for medium-to-long-term investors.
- SIP or Lump Sum: SIPs are preferred to reduce volatility risks.
Final Word
The Best ELSS Mutual Funds 2025 continue to shine as reliable tax-saving and wealth-building tools. Our research verified with AMFI confirms that Regular Plans deliver excellent results, while Direct Plans remain slightly ahead due to cost advantages.
For investors in 2025, these top 10 ELSS mutual funds stand out as excellent choices for tax-saving and long-term financial growth.
FAQs on Best ELSS Mutual Funds 2025
1. What are ELSS Mutual Funds?
ELSS (Equity Linked Savings Schemes) are diversified equity mutual funds that offer tax benefits under Section 80C of the Income Tax Act, with a mandatory lock-in of 3 years.
2. Are ELSS Mutual Funds risky?
Yes, ELSS funds are market-linked and carry equity risks. However, over the long term, they can generate significantly higher returns compared to traditional tax-saving instruments.
3. Which is better – Direct Plan or Regular Plan?
Direct Plans generally deliver 1–2% higher returns annually because they eliminate distributor commissions. However, if you need expert guidance, Regular Plans may be suitable.
4. How much can I invest in ELSS to save tax?
You can invest any amount, but the maximum deduction available under Section 80C is ₹1.5 lakh per financial year.
5. Can I exit ELSS before 3 years?
No, ELSS comes with a mandatory 3-year lock-in period, making it the shortest among tax-saving instruments but still non-withdrawable before maturity.
6. Which is the best ELSS fund in 2025?
Based on 5-year annualised returns, Motilal Oswal ELSS Tax Saver Fund and HDFC ELSS Tax Saver Fund are among the top-performing schemes verified by AMFI.
