Capital gains bonds are a tax-saving option for investors who have earned profits from the sale of assets like property. Under Section 54EC of the Income Tax Act, investing in these bonds helps you defer or save capital gains tax.
They are issued by government-backed institutions and offer safe, fixed interest income over a lock-in period.
Features of Capital Gains Bonds
- Tax Saving: Exempt capital gains up to ₹50 lakh.
- Government Backed: Issued by REC, NHAI, etc.
- Fixed Interest: Earn steady income over 5 years.
- Safe Investment: Minimal risk with assured returns.
- No TDS: Interest is paid annually without deduction.
Ideal for high-value asset sellers, these bonds offer a compliant and efficient way to save on taxes while earning returns.