Top 5 Tax Saving Schemes and Investments in 2025

As the new financial year has begun from April, we plan for our personal and professional growth, and it’s also time to think about our money growth. As you earn money, you have to pay taxes right? However, there are a few smart ways through which you can save money on taxes by investing money in tax saving schemes and investments in India, which will also enable you to grow wealth. So, you can secure your future and help you save on taxes!

In this blog, we’ll explore the top 5 best tax-saving schemes and investments in India for 2025, explained in simple terms, so you can feel confident making decisions that help you save and grow your money!

Top 5 Tax-Saving Investment Options:

1. Equity-Linked Savings Scheme (ELSS)

An Equity-Linked Savings Scheme (ELSS), popularly known as a tax saving mutual fund, is the only type of mutual fund eligible for tax deductions under Section 80C of the Income Tax Act, 1961. This makes it one of the best tax saving investments for individuals looking to grow their wealth while enjoying a tax benefit investment option.

Features: 

– ELSS has a lock-in period of just 3 years, making it one of the shortest in all the tax-saving investment options available in India.

– You can claim tax deductions of up to ₹1.5 lakh under Section 80C of the Income Tax Act under the old tax regime.

– They are a type of equity mutual fund offering the dual benefit of tax deductions and wealth creation over time

– You can invest in it through SIP or lump sum

You can check out Lxme Tax Saving Fund, which consists of an ELSS fund that is well-researched and curated by experts.

2. Public Provident Fund (PPF)

Public Provident Fund (PPF) is one of the long-term investment schemes backed by the Government.  It is also called a savings-cum-tax savings investment vehicle that enables one to fulfill long-term goals while saving on annual taxes.

Features:

– PPF has a maturity period of 15 years.

– PPF enjoys the EEE (Exempt, Exempt, Exempt) tax benefit. That means you can save taxes when you are investing up to ₹1.5 lakh under Section 80C of the Income Tax Act under the old tax regime, you can earn tax-free interest, and you can withdraw your PPF investments tax-free.

– It offers a 7.1% rate of interest (These interest rates get revised periodically by the government)

– Has provision of premature withdrawal, you can withdraw up to 50% of the amount in your PPF Account after seven years, beginning from the end of the year you made your initial contribution.

3. National Pension Scheme (NPS)

National Pension Scheme (NPS) is a pension cum tax benefit investment scheme launched by the Government of India to provide security at the time of retirement to Citizens of India. It is an attractive long-term savings avenue to effectively plan your retirement through investing in different asset classes available under NPS.

Features:

– NPS offers two types of accounts: Tier 1 and Tier 2. Tier 1 is a retirement account, while Tier 2 is like a savings account.

– You get a deduction of up to ₹2 lakh under Section 80C and Section 80CCD(1B), which means you can reduce your taxable income. This deduction is only available under old tax regime.

– You can invest in various instruments such as equity, debt, and government bonds.

– It has a maturity period till age 60.

– NPS offers market-linked returns, and the investor has an option to change the pension fund manager once a year if they are not satisfied with the performance of the fund.

– It is mandatory for an investor to invest in NPS till the age of 60 years. However, partial withdrawals of up to 25% of the contributions made are allowed after 3 years from the date of account opening. And this restriction is applicable only for Tier I accounts.

4. Sukanya Samriddhi Yojana (SSY)

Sukanya Samriddhi Yojana is one of the government tax saving investments in India aimed at supporting the financial future of girl children, which will help parents save for their daughters’ higher education, goals for teenage girls, and other expenses.

Features:

– An SSY account can be opened for any girl child under the age of 10. Families with up to two girl children can open accounts.

– Sukanya Samriddhi Yojana also enjoys the EEE (Exempt, Exempt, Exempt) tax benefit. That means you can save taxes when you are investing up to ₹1.5 lakh under Section 80C of the Income Tax Act under the old tax regime, you can earn tax-free interest, and you can withdraw your PPF investments tax-free.

– The account matures after 21 years from the date of opening. Before the account matures i.e., premature withdrawal, you can do up to 50% of the balance if the girl child is at least 18 years old or has completed the 10th standard.

– Offers an interest rate of 8.2% p.a.* (subject to change as per Government policies)

5. National Savings Scheme:

The National Savings Certificate (NSC) is a savings option by the government that is backed by a fixed-income investment scheme offered by India Post. These certificates earn fixed interest to provide stable and long-term income.

Features: 

– NSC has a maturity period of 5 years.

– You can claim tax deductions of up to ₹1.5 lakh under Section 80C of the Income Tax Act under the old tax regime.

– It offers a 7.7% rate of interest (These interest rates get revised periodically by the government)

– NSC may not be prematurely closed before 5 years, except few conditions listed by the post office.

Note: All of these tax benefits are only available under the old tax regime, except tax-free interest and tax-free maturity amount in case of PPF & SSY can be claimed in the new tax regime.

As women, we often juggle multiple roles—whether it’s managing a household, building a career, or caring for our loved ones. But when it comes to our finances, we deserve to take control and make decisions that help us grow and secure our future.

These best tax saving investments listed above are not only easy to understand but also cater to different financial goals. From tax saving mutual funds to other tax benefit investment options, each one helps you build wealth while enjoying deductions under the Income Tax Act.

So, don’t wait explore these tax saving investments in India, start investing today, and give yourself the gift of financial freedom in 2025!

Remember: It’s never too late to start planning for your future. And the best part? You don’t have to do it alone. Talk to a Lxme Money Buddy or money Coaches, and you’ll be well on your way to building a tax-savvy investment plan that suits your needs!

If you are looking for work opportunities for women, then click here and learn more. 

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Further read:

• 8 Best Saving Schemes for Women in India
• 10 Money Saving Tips for Housewives
• How to Earn Money Online Without Investment in 2025?