Which bond is better NHAI or REC?
Table of Contents
- Which bond is better NHAI or REC?
- Where should I invest to save capital gains tax?
- What is the interest on capital gain bonds?
- How can I buy 54 EC bonds?
- Can REC bonds be redeemed before maturity?
- What is the lock in period for capital gain bonds?
- Who is eligible for capital gains exemption?
- How is capital gain calculated?
- How do you cash out rec bonds?
- When to invest in a capital gain bond?
- Which is the best way to save capital gain?
- Which is best for capital gain bond NHAI or Rec bond?
- How are capital gains bonds help in tax exemptions?
Which bond is better NHAI or REC?
REC bonds score a bit higher than NHAI bonds. Because on maturity i.e., after 5 years, NHAI bondholders have to apply for surrender of bonds only then the maturity amount is redeemed and paid by cheque or ECS. In the case of REC bonds, it will be automatically redeemed and paid by cheque or ECS.
Where should I invest to save capital gains tax?
“Section 54EC allows investors to save tax on Long Term Capital Gains realised from the sale of a long term asset by investing the entire capital gains realised or a part of it in Capital Gain Bonds issued by National Highways Authority of India and Rural Electrification Corporation Limited,” said Ratan Chaudhary, Head ...
What is the interest on capital gain bonds?
Capital Gains Bonds
|Rate of Interest||5.00% p.a. payable annually|
|Taxation||Interest is taxable although no TDS is deducted|
|Redemption||Automatic Redemption after 5 Years|
How can I buy 54 EC bonds?
How to invest in 54 EC capital gain tax exemption bonds online in...
- Our Answer: 54EC bonds are specifically meant for investors earning long-term capital gains. ...
- Investment via broker.
- Click the “Fill a New Form online” button for the bond issuer you prefer. ...
- Click the “upload Application/KYC documents” button.
Can REC bonds be redeemed before maturity?
The NHAI /REC bond can be fully redeemed at maturity after three years. You cannot transfer these bonds in another person's name. Also, it is a non-negotiable financial instrument, hence one should not expect to get money by keeping the bond as a security against any loan or advance, since this is not permitted.
What is the lock in period for capital gain bonds?
To avail the tax-exemption the investment must be made within 6 months of the date of sale of immovable property. Such investment can be redeemed only after 5 years. Before april 2018 the bonds could be redeemed within 3 years.
Who is eligible for capital gains exemption?
The capital gains exemption (CGE) is available to individuals only, not corporations, and forms a deduction (worth 50% of the exemption, since 50% of capital gains are taxed) from net income. Benefits that use net income, such as the age credit and OAS clawback, will be calculated before the deduction is reflected.
How is capital gain calculated?
In case of short-term capital gain, capital gain = final sale price – (the cost of acquisition + house improvement cost + transfer cost). In case of long-term capital gain, capital gain = final sale price – (transfer cost + indexed acquisition cost + indexed house improvement cost).
How do you cash out rec bonds?
Bonds will be automatically redeemed by REC on maturity, without the surrender of Bond Certificate(s) and the proceeds would be paid by cheque or NECS/ECS. Demat account is not mandatory, if you don't have demat a/c, then you will receive physical bond certificate like your Fixed Deposit.
When to invest in a capital gain bond?
Capital gain bonds are the eligible financial instruments under section 54EC, in which investors can invest the capital gain amount and save oneself from paying any long-term capital gain tax on the sale of the property. Investment has to be made within 6 months from the date of sale.
Which is the best way to save capital gain?
Capital Gain Bonds is the best way to save long term capital gain. I will explain it later. The exemption through capital gain bonds is available u/s 54EC. These bonds are issued by NHAI and REC. You can invest through any of the nearest bank branches.
Which is best for capital gain bond NHAI or Rec bond?
Quora User, Investor (2002-present) REC Bonds and NHAI Bonds - both have a tenure of 3 years with coupon rate of 5.25% and will be redeemed at the end of 3 years.
How are capital gains bonds help in tax exemptions?
An individual can invest in these bonds after receiving capital gains from selling a property, thus availing the necessary tax exemption. These constitute of bonds from the National Highway Authority of India (NHAI) and Rural Electrification Corporation (REC.) How Capital Gains Bonds Help in Tax Exemptions?