Capital Gain Bonds
Save Taxes. Earn Steady Returns.
Capital Gain Bonds (54EC Bonds) offer a smart way to save long-term capital gains tax under Section 54EC of the Income Tax Act. These bonds are issued by government-backed institutions and provide fixed, secure returns.
When you sell a long-term capital asset like real estate and earn a capital gain, investing the proceeds in 54EC bonds within 6 months can help you save tax while earning steady interest.
Key Features of 54EC Capital Gain Bonds
- Tax Savings: Save up to ₹50 lakhs in capital gains from tax liability.
- 5-Year Lock-in: Bonds have a mandatory lock-in period of 5 years.
- Fixed Interest: Earn an annual fixed interest (currently ~5% p.a.).
- Safe Investment: Issued by entities like NHAI and REC backed by the Government of India.
- Minimum Investment: ₹10,000 with increments of ₹10,000, up to ₹50 lakhs per financial year.
Why Invest in Capital Gain Bonds
- Tax Efficiency: Avoid long-term capital gains tax legally and efficiently.
- Capital Preservation: Secure your gains with a low-risk, fixed-income option.
- No TDS: Interest income is taxable but TDS is not deducted at source.
- Online/Offline Application: Easily invest through both digital and offline modes.