Parag Parikh ELSS Tax Saver Fund

The Parag Parikh ELSS Tax Saver Fund is an open-ended equity linked saving scheme of PPFAS Mutual Fund , allotted on 24 July 2019 as the Parag Parikh Tax Saver Fund, that invests at least 80 per cent in equity under the SEBI category “ELSS - Tax Saver Fund” and locks each unit for three years in return for an income-tax deduction of up to Rs 1,50,000 a year under the old tax regime.

The scheme held Rs 5,400.57 crore at 30 September 2026, according to the PPFAS factsheet for that month, which made it 2.34 per cent of the Rs 2,30,662.36 crore held by India’s 39 open-ended ELSS schemes in the AMFI monthly report for September 2026 (a webnotes.in calculation). It is benchmarked to the Nifty 500 TRI , offers only a growth option, charges no exit load, and was run by six fund managers led by Rajeev Thakkar , the AMC’s chief investment officer, at that date.

The tax basis of the scheme changed on 1 April 2026. The Income-tax Act 2025 repealed the 1961 Act, so the deduction once known as section 80C is now section 123 read with Schedule XV paragraph 1(m), with the same Rs 1,50,000 cap. It is still available only to a taxpayer who opts out of the default regime under section 202. The lock-in, the Rs 500 minimum and the one-ELSS-per-AMC rule come from the Equity Linked Saving Scheme 2005 , which the 2025 Act carries forward through its savings clause in section 536(2)(j).

The portfolio is a narrower, India-only version of the flagship Parag Parikh Flexi Cap Fund : eight of the ELSS scheme’s 10 largest holdings at 30 September 2026 were also in the flagship’s top 10, but the ELSS scheme held no foreign equity. Over the year to that date the regular plan lost 10.49 per cent against a 2.03 per cent fall in the Nifty 500 TRI, while its return since allotment, 15.48 per cent a year, stayed above the index’s 14.17 per cent.

Scheme profile

The Parag Parikh ELSS Tax Saver Fund is defined in its scheme information document of 28 November 2025 as “An open ended equity linked saving scheme with a statutory lock in of 3 years and tax benefit”, scheme code PPFA/O/E/ELS/19/02/0003. Its investment objective is “long-term capital appreciation through a diversified portfolio of equity and equity related instruments”, with 80 per cent of total assets held in line with the Equity Linked Saving Scheme 2005, as the September 2026 factsheet states.

Table: Parag Parikh ELSS Tax Saver Fund scheme profile, from the PPFAS factsheet for September 2026, the scheme information document dated 28 November 2025 and the key information memorandum.

A unit bought at the Rs 10 face value on allotment was worth Rs 28.1489 in the regular plan on 30 September 2026, 2.81 times the issue price in a little over seven years. The scheme files and URLs on amc.ppfas.com still use the old “parag-parikh-tax-saver-fund” path, and the factsheet still abbreviates the scheme as PPTSF.

Launch and rename

PPFAS Mutual Fund allotted the first units of the Parag Parikh Tax Saver Fund on 24 July 2019, the inception date recorded in the key information memorandum and the start date for every return in the factsheet. It was the AMC’s third scheme, after the Parag Parikh Flexi Cap Fund (allotted 24 May 2013) and the Parag Parikh Liquid Fund (allotted 11 May 2018); the full sequence is in the PPFAS scheme launch timeline .

The 4 July 2019 launch date that several websites carry, and that earlier versions of this page carried, is not the allotment date. The New Fund Offer window itself could not be confirmed at a primary source: one secondary listing gives 4 to 18 July 2019 and another page on this site gave 18 June to 2 July 2019, so no NFO dates are stated here. The NFO period for an ELSS is not set by SEBI; paragraph 1.7.2 of the SEBI Master Circular of 20 March 2026 leaves it to “guidelines issued by Government of India”.

The scheme took its present name on 11 December 2023. SEBI letter SEBI/HO/IMD/IMD-RAC-2/P/OW/2023/40331/1, dated 26 September 2023, advised AMCs to change the names of ELSS schemes to “ELSS Tax Saver” “in order to facilitate ease of identification by investors and implement uniform nomenclature across mutual funds”, as the PPFAS factsheet for November 2023 quotes it. The instruction was a SEBI letter. The rename left the mandate, managers and benchmark unchanged, and the same letter applied to every ELSS in the industry.

SEBI’s category label “ELSS - Tax Saver Fund” has a separate source: footnote 43 of the 20 March 2026 Master Circular cites SEBI letter SEBI/HO/IMD-POD-2/P/OW/2023/1114/1 of 10 January 2023 for it. SEBI’s recategorisation circular HO/24/13/15(2)2026-IMD-RAC4/I/5764/2026 of 26 February 2026, which requires every scheme name to match its category (clause 2.6.5), needed no further change here.

ELSS rules that bind the scheme

The Parag Parikh ELSS Tax Saver Fund is bound by two instruments at once: the Equity Linked Saving Scheme 2005, a Central Government notification that sets the tax conditions, and the SEBI category rules in the Master Circular for Mutual Funds of 20 March 2026 (HO/24/13/11(1)2026-IMD-POD-1/I/7602/2026). The first decides whether the investor gets the deduction; the second decides what the AMC may launch and hold.

Equity Linked Saving Scheme 2005

The Equity Linked Saving Scheme 2005 is Notification No. 226/2005, S.O. 1563(E), dated 3 November 2005, amended by Notification No. 259/2005 of 13 December 2005, issued under section 80C(2)(xiii) of the Income-tax Act 1961. The text read here is the copy reproduced in a mutual fund offer document hosted on sebi.gov.in, not the Gazette original.

Table: principal conditions of the Equity Linked Saving Scheme 2005 (Notification 226/2005 of 3 November 2005, as amended 13 December 2005).

The 2005 scheme survives the repeal of the 1961 Act by inference rather than by name. Section 536(2)(j) of the Income-tax Act 2025 deems every notification and scheme issued under the repealed Act, “so far as it is not inconsistent with the corresponding provisions of this Act”, to have been issued under the corresponding provision of the new Act. Schedule XV paragraph 1(m) of the 2025 Act still refers to a plan “formulated in accordance with such scheme notified by the Central Government”. The word ELSS does not appear in the 2025 Act.

SEBI category and the one-scheme rule

SEBI places ELSS at item 13 of the equity scheme table in paragraph 3.8.1 of the 20 March 2026 Master Circular, with a minimum of 80 per cent of total assets in equity and equity related instruments and the type of scheme described as “An open ended scheme with attributes in accordance with Equity Linked Saving Scheme, 2005 notified by Ministry of Finance”. Paragraph 3.10.1 permits one scheme per category, and paragraph 3.10.2 lets an AMC run either an active ELSS or a passive ELSS through an index fund, not both.

The passive route dates from SEBI circular SEBI/HO/IMD/DOF2/P/CIR/2022/69 of 23 May 2022, and paragraph 3.10.2(b) requires a passive ELSS to track “one of the indices comprising of equity shares from top 250 companies in terms of market capitalization”. The Nifty 500 does not meet that test. PPFAS runs the active version, so it cannot also launch an ELSS index fund. The 26 February 2026 recategorisation circular left the ELSS category as it was.

Lock-in

Every unit of the Parag Parikh ELSS Tax Saver Fund is locked for three years from its own date of allotment. The scheme information document of 28 November 2025 says redemption “can be made only after a period of three years (lock-in period) from the date of allotment of Units proposed to be redeemed”, following paragraph 3(d) of the Equity Linked Saving Scheme 2005, which defines a year as one “commencing from the date of allotment”.

The consequence for a systematic investment plan is that a portfolio unlocks in slices. A monthly SIP of Rs 1,000 started in April 2026 produces 12 separate lots in tax year 2026-27, and the April 2026 lot becomes redeemable in April 2029 while the March 2027 lot stays locked until March 2030. Units the scheme allots on a switch from another PPFAS scheme start a fresh three-year clock in the same way; the treatment at the end of the period is covered in what happens when the ELSS lock-in ends .

Two further provisions of the 2005 scheme qualify the lock-in. On the death of the investor, paragraph 3(e) lets the nominee or legal heir withdraw after one year from allotment, which the scheme information document repeats. Paragraph 4 bars any transfer, assignment or pledge of units for three years from issue, so ELSS units inside the lock-in cannot be offered as loan collateral. The general rules are in ELSS lock-in .

Tax deduction from tax year 2026-27

The deduction for an investment in the Parag Parikh ELSS Tax Saver Fund moved from section 80C of the Income-tax Act 1961 to section 123 of the Income-tax Act 2025 on 1 April 2026, and the cap stayed at Rs 1,50,000 a year. Section 123, in Part B of Chapter VIII, allows an individual or a Hindu undivided family a deduction of “the whole of the amount paid or deposited in the tax year, being the aggregate of the sums enumerated in Schedule XV”, up to that cap.

ELSS units sit in Schedule XV paragraph 1(m): “subscription to any units of any Mutual Fund referred to in serial number 20 or 21 of the Table in Schedule VII … under any plan formulated in accordance with such scheme notified by the Central Government”. PPFAS Mutual Fund, registered with SEBI, is a serial number 20 fund. The tax year is defined in section 3(1) as the 12 months of the financial year beginning 1 April, replacing the old pairing of previous year and assessment year, so tax year 2026-27 runs from 1 April 2026 to 31 March 2027.

Table: ELSS deduction before and after the Income-tax Act 2025, from the Act as published in the Gazette of India of 21 August 2025.

Default regime excludes the deduction

The default regime in section 202 of the Income-tax Act 2025 gives no deduction for ELSS. Section 202(2)(a)(xii) computes total income “without any exemption or deduction under … Chapter VIII other than the provisions of sections 124(1) and 124(2), or 125(2) or 146”, and section 123 is not in that list. A salaried taxpayer with no business income chooses the old basis each year with the return of income, under section 202(4)(b); a taxpayer with business income opts out once and may withdraw the choice once, under section 202(4)(a). The trade-off between the two is in new tax regime and old tax regime .

What shares the Rs 1,50,000 cap

The Rs 1,50,000 limit is one ceiling across every Schedule XV item: life insurance premiums at paragraph 1(a), provident fund contributions including the Public Provident Fund at 1(d) to 1(f), the girl-child deposit scheme that is the Sukanya Samriddhi Yojana at 1(h), payments for a residential house at 1(r) and five-year tax-saver fixed deposits at 1(s), among others. An employee whose provident fund contribution already reaches Rs 1,50,000 gains no deduction from an ELSS investment. The tax saved equals the deduction multiplied by the taxpayer’s marginal rate plus cess, so it is zero for anyone whose income is already below tax under the old regime.

Schedule XV paragraph 4 of the 2025 Act lists the deductions that are reversed if an investment is closed early: life insurance, unit-linked plans, house property and eligible issues of shares. It has no row for ELSS units, consistent with the fact that ELSS units cannot be redeemed early; the claim procedure is in how to claim the ELSS deduction and the PPFAS-specific detail in PPFAS ELSS and section 80C .

Tax on redemption

Gains on the Parag Parikh ELSS Tax Saver Fund are always long-term, because no unit can be redeemed before three years and the long-term threshold for listed equity and equity oriented fund units is 12 months under section 2(101) of the Income-tax Act 2025. From tax year 2026-27, section 198 taxes long-term gains on equity oriented funds at 12.5 per cent on the aggregate above Rs 1,25,000 a year. The rate and threshold carry over from section 112A of the 1961 Act as amended by the Finance (No. 2) Act 2024 for transfers from 23 July 2024.

The equity oriented fund test is in section 198(8): at least 65 per cent of the fund in equity shares of domestic listed companies. The ELSS scheme clears it by a wide margin, with core equity at 90.92 per cent of net assets on 30 September 2026. The 20 per cent short-term rate in section 196 applies only to units held for 12 months or less, which the three-year lock-in rules out. The growth-only structure means the scheme pays no income distribution, so no dividend tax or TDS on distributions arises; the wider rules are in capital gains tax in India .

Portfolio at 30 September 2026

The Parag Parikh ELSS Tax Saver Fund held 90.92 per cent of net assets in core equity on 30 September 2026, 5.63 per cent in REIT and InvIT units, 0.27 per cent in Treasury bills and 3.18 per cent in TREPS and net receivables, according to the PPFAS factsheet. It held no foreign equity, and the factsheet labels it “An India-centric Scheme”.

Table: asset allocation, Parag Parikh ELSS Tax Saver Fund factsheet, 30 September 2026. Rows sum to 100.

The REIT book was Embassy Office Parks REIT at 2.58 per cent, Brookfield India Real Estate Trust at 2.53 and Knowledge Realty Trust at 0.52, within the SEBI REIT and InvIT exposure cap . These units are not among the securities paragraph 5(a) of the ELSS 2005 lists, so they sit inside the 20 per cent non-equity allowance; neither the factsheet nor the scheme information document says so in terms. The factsheet’s market-capitalisation split, 68.94 per cent large cap, 6.70 per cent mid cap and 20.91 per cent small cap, totals 96.55 per cent, which equals core equity plus the REIT and InvIT units.

Top 10 holdings

The 10 largest positions made up 55.73 per cent of net assets on 30 September 2026, a webnotes.in sum of the factsheet weights, out of 41 equity lines counted in the factsheet portfolio statement.

Table: top 10 holdings of the Parag Parikh ELSS Tax Saver Fund against the same stocks in the Parag Parikh Flexi Cap Fund, both from the PPFAS factsheet for September 2026.

Eight of the 10 names appear in both top-10 lists. The two that do not, Maharashtra Scooters and Axis Bank, took the places that Alphabet and Mahindra & Mahindra hold in the flagship. The next holdings in the ELSS scheme were Maruti Suzuki at 3.53 per cent, Mahindra & Mahindra at 3.51, Bharti Airtel at 3.41 and Infosys at 3.13. In September 2026 the scheme added DLF, Sharda Motor, CIE Automotive and Sundrop Brands and sold out of The Great Eastern Shipping Company, which had been 0.19 per cent. PPFAS cash holdings covers the AMC’s cash policy across schemes.

Overseas investment

The scheme information document of 28 November 2025 allows foreign securities up to 35 per cent of net assets “only if permitted under ELSS Rules”, and adds that the scheme may invest in foreign securities “as and when permitted by the ELSS and/or when a clarification is received from SEBI”. The ELSS 2005 notification neither permits nor bars foreign equity in terms. The scheme held none on 30 September 2026, against four US holdings in the Flexi Cap Fund. The industry-wide overseas limits are in SEBI MF overseas investment cap .

Performance against the Nifty 500 TRI

The Parag Parikh ELSS Tax Saver Fund’s regular plan returned 15.48 per cent a year from allotment on 24 July 2019 to 30 September 2026, against 14.17 per cent for the Nifty 500 TRI , according to the PPFAS factsheet for September 2026. Over one and three years both plans trailed the index, and the regular plan also trailed it over five years.

Table: lump-sum returns, growth option, Parag Parikh ELSS Tax Saver Fund factsheet for September 2026.

The factsheet reports rolling three-year returns because three years is the lock-in. On daily rolling returns since inception, the factsheet puts the average three-year return at 19.94 per cent for the regular plan and 21.40 per cent for the direct plan, against 18.28 per cent for the Nifty 500 TRI, with the regular plan’s weakest three-year window at 6.70 per cent against 9.39 per cent for the index. SIP returns to 30 September 2026 were -1.83 per cent a year over three years for the regular plan, against 1.95 per cent for the benchmark.

The factsheet’s risk measures at the same date were a beta of 0.70, a standard deviation of 11.65 per cent and a Sharpe ratio of 0.19, computed against a 5.00 per cent risk-free rate. A beta of 0.70 means the fund moved about 70 per cent as much as the market on average, yet over the year to September 2026 it fell 10.49 per cent against the index’s 2.03 per cent: a low beta measures sensitivity to market moves, not protection from stock-specific losses.

Expense ratio

The Parag Parikh ELSS Tax Saver Fund charged a base expense ratio of 0.54 per cent in the direct plan and 1.54 per cent in the regular plan on 30 September 2026, unchanged from August, according to the PPFAS factsheet. The one percentage point gap is the distribution cost of the regular plan, as explained in regular versus direct plan .

The base ratio excludes statutory levies, which the SEBI (Mutual Funds) Regulations 2026 allow over the cap. Under Regulation 66 of those regulations, in force from 1 April 2026, the base expense ratio ceiling for an equity scheme on the first Rs 500 crore of assets is 2.10 per cent, down from 2.25 per cent under Regulation 52 of the 1996 regulations. The scheme information document of 28 November 2025 still prints the old 2.25 per cent slab because it predates the 2026 regulations. The full slab structure is in mutual fund TER in India .

For comparison, the Parag Parikh Flexi Cap Fund’s base ratio on the same date was 0.53 per cent direct and 1.05 per cent regular. The regular ELSS plan therefore costs 0.49 percentage points a year more than the regular flagship plan, on a scheme about one twenty-seventh its size.

Fund managers

PPFAS names six managers on the Parag Parikh ELSS Tax Saver Fund, the same team as on the Parag Parikh Large Cap Fund and the Parag Parikh Arbitrage Fund , with dates taken from the September 2026 factsheet.

Table: fund managers of the Parag Parikh ELSS Tax Saver Fund, PPFAS factsheet for September 2026.

Raj Mehta’s date reflects a change of role rather than a new appointment: the November 2023 factsheet lists him as debt fund manager on the scheme since inception, and the September 2026 factsheet as equity fund manager from 1 September 2025. Insiders held a combined Rs 62.47 crore in the scheme on 30 September 2026, according to the factsheet’s skin-in-the-game disclosure.

Comparison with the Parag Parikh Flexi Cap Fund

The Parag Parikh ELSS Tax Saver Fund and the Parag Parikh Flexi Cap Fund share a benchmark, most of a management team and eight of their 10 largest holdings, but they differ on lock-in, overseas exposure, minimum equity and cost.

Table: Parag Parikh ELSS Tax Saver Fund against the Parag Parikh Flexi Cap Fund, from the PPFAS factsheet for September 2026 and each scheme’s information document dated 28 November 2025.

For a taxpayer who has opted out of the default regime and has unused Schedule XV room, the ELSS scheme offers a near-copy of the flagship’s Indian book with a deduction attached. For a taxpayer on the default regime, it offers the same Indian book with a three-year lock-in and a higher regular-plan cost, and no tax benefit in exchange. Other ELSS schemes are compared in PPFAS ELSS against Axis, Mirae and Quant .

The ELSS category in September 2026

India had 39 open-ended ELSS schemes with net assets of Rs 2,30,662.36 crore and 1,61,06,808 folios on 30 September 2026, according to the AMFI monthly report for September 2026. The category had a net outflow of Rs 662.14 crore that month, Rs 1,087.92 crore in and Rs 1,750.06 crore out, while equity schemes as a whole took in a net Rs 38,306.55 crore. ELSS and contra funds were the only two equity categories with net outflows.

A further 13 close-ended ELSS schemes held Rs 3,813.41 crore, legacy plans under paragraph 8 of the 2005 scheme, which terminates a plan at the close of the tenth year from allotment. At Rs 5,400.57 crore the PPFAS scheme held 2.34 per cent of open-ended ELSS assets, a webnotes.in calculation from the AMFI and PPFAS figures. The category is described in ELSS mutual funds in India , and the alternatives that compete for the same deduction in ELSS versus PPF , ELSS versus NPS and ELSS versus ULIP .

Buying and redeeming units

Direct plan units of the Parag Parikh ELSS Tax Saver Fund can be bought through the PPFAS website and app, the registrar CAMS , MF Central , MF Utility and stock-broker and execution-only platforms; regular plan units are sold through AMFI-registered distributors holding an ARN , who earn a trail commission from the regular plan’s higher expense ratio. The steps on one broker platform are in how to invest in ELSS on Coin , and for PPFAS directly in how to start a PPFAS ELSS SIP .

The purchase NAV follows the applicable NAV cut-off rules described in NAV cut-off reform 2021 . The scheme publishes its NAV by 11 pm every business day, as the scheme information document states. After the lock-in, the minimum redemption is Rs 500 or the account balance, whichever is lower, and the scheme information document commits to paying redemption proceeds within three working days, five in exceptional cases, with interest at 15 per cent a year for any delay.

See also

• PPFAS Mutual Fund
• PPFAS Asset Management Private Limited
• Parag Parikh Flexi Cap Fund
• Parag Parikh Liquid Fund
• Parag Parikh Large Cap Fund
• Parag Parikh Arbitrage Fund
• Parag Parikh Conservative Hybrid Fund
• Parag Parikh Dynamic Asset Allocation Fund
• PPFAS scheme launch timeline
• PPFAS ELSS and section 80C
• PPFAS ELSS against Axis, Mirae and Quant
• PPFAS cash holdings
• PPFAS custodian, RTA and auditor relationships
• Parag Parikh
• Rajeev Thakkar
• Raunak Onkar
• Rukun Tarachandani
• Raj Mehta
• Tejas Soman
• Aishwarya Dhar
• ELSS mutual funds in India
• ELSS lock-in
• Passive ELSS
• Equity Linked Saving Scheme 2005
• ELSS versus PPF
• ELSS versus NPS
• ELSS versus ULIP
• How to claim the ELSS deduction
• How to handle ELSS lock-in expiry
• How to start a PPFAS ELSS SIP
• How to invest in ELSS on Coin
• Income-tax Act 2025
• Section 123 of the Income-tax Act 2025
• Section 80C
• Section 112A
• New tax regime
• Old tax regime
• Equity mutual fund taxation in India
• Capital gains tax in India
• SEBI
• SEBI (Mutual Funds) Regulations 2026
• SEBI Master Circular for Mutual Funds 2026
• SEBI scheme rationalisation circular 2017
• SEBI MF overseas investment cap
• REIT and InvIT exposure cap for mutual funds
• Mutual fund TER in India
• Mutual fund riskometer
• Nifty 500 TRI
• Rolling versus trailing returns
• Regular versus direct plan
• SIP mutual funds in India
• Applicable NAV
• AMFI
• CAMS
• Public Provident Fund
• National Pension System

External references

• PPFAS Mutual Fund, factsheet for September 2026: https://amc.ppfas.com/downloads/factsheet/2026/ppfas-mf-factsheet-for-September-2026.pdf
• PPFAS Mutual Fund, scheme information document, Parag Parikh ELSS Tax Saver Fund: https://amc.ppfas.com/downloads/parag-parikh-tax-saver-fund/sid-parag-parikh-tax-saver-fund.pdf
• Income-tax Act 2025, Gazette of India: https://egazette.gov.in/WriteReadData/2025/265620.pdf
• SEBI Master Circular for Mutual Funds, 20 March 2026: https://www.sebi.gov.in/sebi_data/attachdocs/mar-2026/1774024028162.pdf
• SEBI circular on categorisation and rationalisation of schemes, 26 February 2026: https://www.sebi.gov.in/sebi_data/attachdocs/feb-2026/1772079826878.pdf
• AMFI monthly report, September 2026: https://portal.amfiindia.com/spages/amsep2026repo.pdf

References

1. PPFAS Mutual Fund, “Factsheet for September 2026”, pages 6 to 9 (Parag Parikh ELSS Tax Saver Fund), data as on 30 September 2026.
2. PPFAS Mutual Fund, “Scheme Information Document, Parag Parikh ELSS Tax Saver Fund”, dated 28 November 2025, and the Key Information Memorandum.
3. PPFAS Mutual Fund, “Factsheet for November 2023”, page 4, notice of change in scheme name effective 11 December 2023, quoting SEBI letter SEBI/HO/IMD/IMD-RAC-2/P/OW/2023/40331/1 dated 26 September 2023.
4. Income-tax Act 2025 (Act 30 of 2025), sections 2(101), 3(1), 123, 196, 198, 202 and 536, and Schedules VII and XV, Gazette of India Extraordinary, Part II, Section 1, 21 August 2025.
5. Ministry of Finance, Equity Linked Saving Scheme 2005, Notification No. 226/2005, S.O. 1563(E), 3 November 2005, as amended by Notification No. 259/2005, 13 December 2005.
6. SEBI, Master Circular for Mutual Funds, HO/24/13/11(1)2026-IMD-POD-1/I/7602/2026, 20 March 2026, paragraphs 1.7.2, 3.8.1, 3.10.1 and 3.10.2.
7. SEBI, “Categorization and Rationalization of Mutual Fund Schemes”, circular HO/24/13/15(2)2026-IMD-RAC4/I/5764/2026, 26 February 2026.
8. SEBI, circular SEBI/HO/IMD/DOF2/P/CIR/2022/69, 23 May 2022, on active and passive ELSS schemes.
9. SEBI (Mutual Funds) Regulations 2026, F. No. SEBI/LAD-NRO/GN/2026/294, notified 15 January 2026, Regulation 66.
10. AMFI, Monthly Report for September 2026, open-ended and close-ended ELSS rows.