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Capital Gain Bonds

Fixed Income

We offer Capital Gains Bond under Section 54EC of the Income Tax Act, 1961. Those desirous of availing exemption from capital gains tax under Section 54 EC may invest in these bonds.

Capital gains arising from transfer of Long-term capital assets can be invested in these bonds within a period of six months from the date of transfer of the asset for getting exemption from the capital gains tax. Such Bonds are issued by SIDBI, NHB, NHAI and REC.

Key Features:

  • Minimum investment of Rs10,000 and in multiples of Rs10,000 thereafter
  • Interest Payment: Semi Annual, Annual or Cumulative
  • Lock-in-period of 5 years for all the structures
  • No TDS on Interest payable for Resident Investors
  • Rating from CARE
  • Rate of Interest: Due to frequent change in the rate of interest, investors are requested to check the same before investing
  • NRIs, OCBs or FIIs are eligible to invest on non-repatriation basis

Capital gains tax can significantly impact the financial outcome of selling a long-term asset, such as property or stocks. However, the Indian Income Tax Act provides an effective way to reduce or defer this tax through Section 54EC Bonds. These bonds not only provide an attractive investment avenue but also allow taxpayers to save on capital gains tax. By investing in these bonds, taxpayers can defer their tax liabilities, making it a prudent choice for those looking to manage their capital gains efficiently.