Want to generate Tax Relief on the particular investment? Confused about the investment options that provide such relief? Choosing the right tax saving options might be difficult for the investors as while investing one need to look into the various factors like liquidity and returns and making sure how one is taxed is the most important factor to consider.

It is considered vigilant for the investor to invest in options that not only save their taxes but even help them to generate tax-free income. There are various tax options which provide you with tax relief options but there are limited such options that let you generate the tax-free income. Below are certain tax savers that would not only save your taxes but would even generate tax-free income.

But the choice of choosing the best suitable option solely depends on the investors therefore, while making a choice try considering all the features of the particular tax saving option.

·       Equity-linked saving scheme:

These are the diversified mutual fund scheme with two varied features, the first being the tax benefit under the section 80C which is up to a limit of 1.5 lakh per year and the second being the lock-in period of 3 years. The former feature suits for the one looking for a regular income while the latter suits the one looking to save for a long term need.

·       Public Provident Fund:

These are the favorite saving avenues for several investors as here the principal and interest earned have a guarantee and its return are tax-free. It currently offers 8% interest and is a 15-year scheme which can be extended in the block of 5 years.

·       Employees provident fund:

They are one of the tax saving avenues that help salaried persons. They not only save tax through involuntary tax saving but even generate a tax-free corpus. An employee contributes around 12% of his salary in such funds. An equal share is contributed by the employer but only 3.67% goes in the EPF.

·       Unit-linked Insurance plan:

This is a hybrid plan which ensures protection as well as savings. This combo pack not only provides life insurance but also channels one’s saving in different market-linked assets for meeting the long term goals.