CAPITAL GAIN BONDS

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Capital Gains Bonds

54EC bonds, commonly referred to as Capital Gains Bonds, are one of the ways to save long-term capital gain tax. 54EC bonds are specifically meant for any person (individuals, HUFs, partnership firms, companies etc.). You can avail exemption in respect of long-term capital gains arising from the sale of residential property, if the capital gain is invested in the Capital Gain Bonds.

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The exemption will be the amount of capital gain or the amount of investment made, whichever is less. The exemption is subject to :

The investment is made within a period of 6 months from the date of transfer of the asset
Maximum investment limit of up to Rs. 50 Lakhs in a Financial Year per individual.
If the amount invested in bonds is less than the capital gains realized, only proportionate capital gains would be exempt from tax.

The eligible bonds under Section 54EC are REC (Rural Electrification Corporation Ltd), PFC (Power Finance Corporation Ltd), NHAI (National Highways Authority of India) and IRFC (Indian Railways Finance Corporation Limited).

Key Features Of 54Ec Bonds

Safe and Secure : 54EC bonds are AAA rated and are issued by PSUs backed by Government of India.

Interest Rate : 54EC bonds offer 5% rate of interest payable annually.

Tax implication : Interest on 54EC bonds is taxable. The principle is tax-free on maturity.

Tenure : 54EC bonds have a lock-in period of 5 years and are non-transferable.

Investment amount : The minimum investment in 54EC bonds is 1 bond amounting to Rs. 10,000 and the maximum investment in 54EC bonds is 500 bonds amounting to Rs 50 lakhs in a financial year.

Mode of Holding : 54EC bonds can be held either in Physical form or in Demat Form.

Risk Factors – Investments in Mutual Funds are subject to Market Risks. Read all scheme related documents carefully before investing. Mutual Fund Schemes do not assure or guarantee any returns. Past performances of any Mutual Fund Scheme may or may not be sustained in future. There is no guarantee that the investment objective of any suggested scheme shall be achieved. All existing and prospective investors are advised to check and evaluate the Exit loads and other cost structure (TER) applicable at the time of making the investment before finalizing on any investment decision for Mutual Funds schemes. We deal in Regular Plans only for Mutual Fund Schemes and earn a Trailing Commission on client investments. Disclosure For Commission earnings is made to clients at the time of investments. Option of Direct Plan for every Mutual Fund Scheme is available to investors offering advantage of lower expense ratio. We are not entitled to earn any commission on Direct plans. Hence we do not deal in Direct Plans.

AMFI Registered Mutual Fund Distributor – ARN-287471 | Date of initial registration – 16/02/2024 | Current validity of ARN – 15/02/2027

AMFI Registered PMS Distributor – APRAN -08209 | Date of initial registration – 26/09/2024 | Current validity of ARN – 25/09/2027

SIF DATE -24/08/2026 EXPIRY DATE 23/08/2029

Grievance Officer- Mrs. DIKSHA SHARMA| 8368073218

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Capital Gains Bonds

Key Features Of 54Ec Bonds