• hamburger-icon
    close-icon

    invest-iconInvest

    trade-iconTrade

    depository-iconInsurance

    watch-iconPMS

    depository-iconTrading Platforms

    depository-iconDepository

    watch-iconWatch Markets

    depository-iconFPI

    watch-iconMerchant Banking

    watch-iconInstitutional Broking

    watch-iconMTF

    partner-iconBecome a Partner

    partner-iconKnowledge Center

    watch-iconResearch

    about-iconAbout Us

    support-iconSupport

    support-iconPricing

    support-iconQuick Links

    support-iconBlog

    hamburger-icon
    close-icon
    54EC Capital Gains

    Tax Exemption Bonds

    Invest in 54EC Bonds
    nps-white-arrow

    Why invest in capital gains bonds?

    Get tax exemption with capital gains through 54EC Capital Gains Tax Exemption Bonds. According to section 54EC of Income Tax 1961, an investor is allowed a deduction in respect of long-term capital gains arising on sale of an asset, if the amounts of capital gains are invested in 54EC bonds.

    Download the application forms to invest in capital gains bonds

    capital-gain-bonds NHAI 54EC Bonds capital-gain-bonds REC 54EC Bonds

    Key Features of 54EC Bonds

    ltcg

    Provides exemption on
    capital gains tax (LTCG)

    lock-in

    Lock-in of 3 years and
    non- transferable

    min-investment

    Minimum investment amount of
    10,000 and multiples

    max-investment

    Maximum investment limit of up to 50 lacs
    in a financial year across all the
    available bonds

    risk-free-invest

    Risk-free investment that pays 5.00%
    p.a. payable annually*. The bond has the
    highest credit rating of AAA by CRISIL,
    CARE and FITCH

    ecs

    Facility of payment of interest and
    redemption through ECS

    bonds-form

    Bonds can be held in .
    Demat /Physical Form

    auto-redemption

    Automatic redemption after 3 Years
    without surrendering bond certificates

    tds

    Interest is taxable but
    no TDS on interest

    NHAI and REC 54 EC Bonds Key Features

    Bond REC 54EC NHAI 54EC
    Coupon/Interest rate/Yield* 5.00% p.a. 5.00% p.a.
    Rating AAA / Stable (CRISIL) AAA / Stable (CRISIL)
    Tenor 5 Years 5 Years
    Face Value / Issue Size per bond 10,000 / 10,000 10,000 / 10,000
    Tax Status Interest is taxable Interest is taxable
    Tax Benefit SEC 54 EC SEC 54 EC
    Minimum Investment 20,000 (or 2 bonds) 10,000 (or 1 bonds)
    Investment Maximum 500 bonds of 50 lacs in a
    Financial Year across REC & NHAI    		 500 bonds of 50 lacs in a
    Financial Year across REC & NHAI
    Mode Of Interest Annual Annual
    Interest Date 30 th June 1st April
    Trustee SBICAP Trustee Company Ltd., Mumbai M/s IL & FS Trust Company Ltd
    Put/Call/Premature Encashment Bullet repayment at the time of Maturity Bullet repayment at the time of Maturity
    More Details REC 54 EC Bond Details NHAI 54EC Bond Details
    * The interest rate change every financial year, this is for FY2021

    FAQ’s

    Q : Who can invest in 54EC Bonds?

    Resident individuals, Hindu Undivided Families (HUF), non-resident Indians (NRIs) and approved institutions are allowed to invest in 54EC Bonds and avail the benefit of long term capital gains exemption as per the Income Tax Section 54EC.

    Q : When to invest in Capital Gains Tax Exemption Bonds?

    Within six months of occurrence of Capital Gains.

    Q : What is the interest rate in 54EC Bonds?

    The interest rate on 54EC Bonds is revised every year by bond issuer. Currently, an interest rate (coupon rate) of 6% p.a. is being offered on this bond (FY2015).

    Q : Are 54EC Bonds safe to invest?

    NHAI and REC bonds have the highest credit ratings from India’s top rating companies indicating highest level of safety in an investment:
    • AAA Stable rating by Crisil Ltd
    • “CARE AAA” by CARE
    • AAA (Ind)/(Affirmed) by Fitch
    In addition these are issued by government of India’s entities REC and NHAI and hence are very safe and come with very minimum risk.

    Q : Why invest in 54EC Bonds?

    To save tax on capital gains. According to the income-tax rules, if you’ve made long-term capital gains (LTCG) by selling a property you held for three years, you have to pay a 20% tax. However, you can avoid paying this tax by investing in bonds specified under section 54EC of the Income-tax Act.

    Q : What are the provisions to avail the capital gains tax exemption?

    As per provisions of Income Tax Act, 1961, any long term capital gains arising from sale of any capital asset would be exempt from tax under section 54EC of the Act if:
    • The entire capital gain realized is invested within 6 months of the date of sale in eligible bonds
    • Such investment must be held for 3 years in the eligible bonds
    • To avail of capital gain exemption, the bonds so acquired cannot be transferred or converted into money or any loan or advance can be taken on security of such bond within 3 years from date of acquisition else, the benefit would be withdrawn
    • If the amount invested in bonds is less than the capital gains realized, only proportionate capital gains would be exempt from tax.
    All FAQ'smd-double-arrow

    NIFTY:22,419.95  Up arrow
    -150.40(-0.67%)
    SENSEX:74,339.44  Up arrow
    -609.28(-0.82%)

    Product

    Trading


    Useful links

    Who we are

    Connect with us

    Stay on top of the markets with our bite-sized newsletter delivered right to your Inbox!

    footer-arrow-icon
    appstore appstore

    #1011 Solitaire Corporate Park, Andheri Ghatkopar Link Road, Chakala, Andheri (E), Mumbai - 400093.

    Arihant Capital Markets Limited is a SEBI registered stock broker and depository participant. SEBI Registration number for NSE & BSE :- INZ000180939; NSDL - IN-DP-127-2015 DP ID-IN301983; CDSL DP ID-43000;NCDEX - 01274; MCX - 56565; AMFI - ARN 15114; SEBI Merchant Banking Reg. No. - MB INM000011070; SEBI Research Analyst Reg. No. - INH000002764. Registered Address: 6, Lad colony, Y.N. Road, Indore – 452001.Corporate office address: #1011 Solitaire Corporate Park, Andheri Ghatkopar Link Road, Chakala, Andheri (E), Mumbai - 400093.

    Please carefully read the risk disclosure document as prescribed by SEBI, as well as the 'Do’s and Don’ts' provided by NSE, BSE, NCDEX, and MCX. If you have any complaints related to securities broking, kindly contact us at complaint@arihantcapital.com. For DP-related matters, please reach out to us at depository@arihantcapital.com.

    If you want to register your complaints through SEBI Score Portal please click here. Mandatory details for filing complaints on SCORES: Name, PAN, Address, Mobile Number, E-mail ID. Benefits: Effective Communication, Speedy redressal of the grievances

    Investments in securities market are subject to market risks; read all the related documents carefully before investing.

    Disclaimer: Arihant Capital Markets Limited is engaged in client based and proprietary trading on various exchanges.

    • ATTENTION INVESTORS :
    • KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (Broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary.
    • For Stock Broking Transaction 'Prevent unauthorised transactions in your account - update your mobile numbers/email IDs with your stockbrokers. Receive information of your transactions directly from Exchange on your mobile/email at the end of the day.
    • For Depository Transaction 'Prevent Unauthorized Transactions in your demat account - Update your Mobile Number with your Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your demat account directly from CDSL/NSDL on the same day.
    • If you are subscribing to an IPO, there is no need to issue cheques. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account.
    • Investors should be cautious on unsolicited emails and SMS advising to buy, sell or hold securities and trade only on the basis of informed decision. Investors are advised to invest after conducting appropriate analysis of respective companies and not to blindly follow unfounded rumours, tips etc. Further, you are also requested to share your knowledge or evidence of systemic wrongdoing, potential frauds or unethical behaviour through the anonymous portal facility provided on BSE & NSE website.
    • Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

    Awareness regarding guidelines of margin collection:
    1)Stock brokers can accept securities as margins from clients only by way of pledge in the depository system w.e.f September 01, 2020.
    2)Update your e-mail and phone number with your stock broker / depository participant and receive OTP directly from depository on your e-mail and/or mobile number to create pledge.
    3)Check your securities / MF / bonds in the consolidated account statement issued by NSDL/CDSL every month.
    Issued in the interest of investors

    Dear Investor - As you are aware, under the rapidly evolving dynamics of financial markets, it is crucial for investors to remain updated and well-informed about various aspects of investing in securities market. In this connection, please find a link to the BSE Investor Protection Fund website where you will find some useful educative material in the form of text and videos, so as to become an informed investor. https://www.bseipf.com/investors_education.html

    Copyright © 2019 Arihant Capital Markets Ltd. All rights Reserved.

    Designed,Developed and Content powered by CMOTS Infotech (ISO 9001:2015 certified)