Capital Gain Bonds

Authorised Arrangers
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Rural Electrification Corporation
REC
Rural Electrification Corporation
IRFC
Rural Electrification Corporation
PFC

54 EC Capital Gain Bonds provide capital gain tax exemption to the investors, under section 54EC of Income Tax Act 1961. The long-term capital gain arises from sale of immovable property can be saved by investing in these Bonds within 6 months of sale. The maximum limit for investing in 54EC bonds is Rs. 50,00,000 in a financial year, and offers 5.00% Interest which is payable annually. The Interest that is earned on these bonds is liable to Income Tax. These bonds come with zero risks of repayment and interest as they are guaranteed by Government of India. Your annual income from interest earned on these bonds is guaranteed by the Government of India.

Why to invest in 54EC Capital Gain Bonds?

To avail the tax exemption on capital gain.

Who are eligible to invest in these bonds?

Individuals/entitities who have earned capital gain from the sale of immovable property.

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Rural Electrification Corporation

REC

(Rural Electrification Corporation)

Minimum Investment
20,000
ROI (per annum)
5
Rating
AAA
Interest Credit Date
30th June
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Indian Railway Finance Corporation

IRFC

(Indian Railway Finance Corporation)

Minimum Investment
20,000
ROI (per annum)
5
Rating
AAA
Interest Credit Date
15th October
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Power Finance Corporation

PFC

(Power Finance Corporation)

Minimum Investment
20,000
ROI (per annum)
5
Rating
AAA
Interest Credit Date
31st July
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Key Features

  • Rate of Interest

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

  • Investment Amount

    Amount of 1 bond is 10,000/- and for PFC, IRFC, REC the minimum number of bond should be 2 that is 20,000/- for each and the maximum investment in 54EC bonds is 500 bonds amounting to Rs 50 lakhs in a financial year.

  • Maturity

    54EC bonds come with a lock-in period of 5 years (effective from April 2018).

  • Transferability

    The 54EC bonds cannot be transferred from one person to another at any point in time.

  • Tax applicable on interest

    No TDS is deducted for resident individual however TDS will be deducted for NRIs. Interest is taxable as per investor income slab for all investors

List of documents required

  1. Self-attested copy of PAN Card (in case of Joint application, self-attested PAN copy of all the applicants) OR Form 60 (in case the investor does not have PAN).
  2. Cancelled Cheque leaf for payment of interest/redemption through NEFT/RTGS facility.
  3. Other documents as applicable below:

Any one of the following for address proof:

  1. AADHAAR Card
  2. Passport/Driving License
  3. Identify Card issued by any Government Institution
  4. Copy of the electricity bill or Gas connection showing residential address
  5. Any document or communication issued by any authority of the Central Government, State Government or local bodies showing residential address
  6. Voters Identity card
  7. Ration Card
  8. Bank Passbook with address and latest transactions updated

All documents (as applicable) attested by any Partner/Notary

  1. Registration certificate, if registered
  2. Partnership deed
  3. Power of Attorney granted to a partner or an employee of the firm to transact business on its behalf
  4. Any officially valid document identifying the partners and the persons holding the Power of Attorney and their addresses
  5. Telephone bill in the name of firm/partners
  6. Copy of PAN/PAN Allotment letter

All documents (as applicable) attested by Trustee/Notary

  1. Certificate of registration, if registered
  2. Power of Attorney granted to transact business on its behalf
  3. Any officially valid document to identify the Trustees, Settlers’, Beneficiaries and those holding Power of Attorney, Founders/Managers/ Directors and their addresses
  4. Resolution of the managing body of the Foundation/Association
  5. Telephone bill
  6. Copy of PAN/PAN Allotment letter (otherwise exemption certificate issued by IT Authorities)

  1. Passport (Mandatory)
  2. Photocopy of Cancelled Cheque (NRO Account)
  3. Self certified address proof

All documents (as applicable) attested by Company Secretary/Director

  1. Certificate of incorporation and Memorandum & Articles of Association
  2. Directors and identification of those who have authority to operate
  3. Power of Attorney granted to its managers, officers or employees to transact business, on its behalf
  4. Copy of PAN/PAN Allotment letter

Blogs

20 December, 2022

Things You Must Know Before Investing In Capital Gain Bonds

Capital Gain Bonds or popularly known as 54EC Bonds are one of the best investment tools available in India that help you reduce your tax liability arising from the sale of capital assets...

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18 January, 2023

How much tax you can save by investing in Capital Gain Bonds?

As the saying goes, it is always good to save money that you already have as it is to earn more. Similarly, it is also a wise decision to save your gains from taxation. One of the best...

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Authorised Arrangers

RR has been an authorised broker/arranger with all issuers of Capital Gain Bonds since their inception. RR is also among the top mobilizers of capital gain bonds in India. We have a pan-India presence through our network and offices.

RR Investors Capital Services Pvt. Ltd AMFI-registered Mutual Fund Distributor

Head Office - New Delhi 412-422, Indraprakash Building 21, Barakhamba Road, New Delhi – 01 Toll Free: 9350316010

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* Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.

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