illis Capital Advisory services Pvt. Ltd is one of the leading financial distribution company in the service industry and provides financial services.

Capital Gain Bonds

The Capital Gains Tax Exemption Bond or 54EC Bonds are bonds in which investments offset the long term capital gains (LTCG) that investors make on capital gains. Only LTCG earned by selling a residential flat or independent house, which you owned for at least three years, can be invested in this bond.

The main objective of this 3-Year bond is to avoid paying income tax on LTCG. Gains made on capital transfer need to be invested in this bond within six month from the sale of capital assets in order for the proceeds of such sale to be exempt from capital gains tax. However, the interest earned on these bonds is fully taxable.

Tax Implications:

To claim Section 54 EC following conditions is to be satisfied.