In which infrastructure bonds should one invest to avoid capital gains tax after selling a property in India?
Capital gain bonds or 54EC bonds are the fixed income instruments that provide capital gains tax exemption under section 54EC to the investors. The tax liability on long-term capital gains from sale of immovable property can be reduced by purchasing 54EC bonds.
What can I invest in to not pay capital gains on property being sold?
You can use retirement savings vehicles, such as 401(k)s, traditional IRAs, and Roth IRAs, to avoid capital gains and defer income tax. With 401(k)s and traditional IRAs, you can invest in the market using pretax dollars.
Are there any bonds in which I can invest my capital gains to claim tax relief?
You can invest the gain in certain specified bonds to claim tax exemption within 6 months of the date of sale of the asset. 54EC bonds, or capital gains bonds, are one of the best way to save long-term capital gain tax arising out of sale a capital asset. The maximum limit for investing in 54EC bonds is Rs. 50,00,000.
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.
How can we save long term capital gains tax on property in India?
3 Ways to Save on Capital Gain Tax on the Sale of Property
- Invest in CGAS (Capital Gains Account Scheme) Investing in Capital Gains Account Scheme (CGAS) is another means to save capital gains tax on property sales. …
- Set off all Capital Losses. …
- Invest in Bonds.
How do you avoid capital gains tax when selling a house?
How Do I Avoid Paying Taxes When I Sell My House?
- Offset your capital gains with capital losses. …
- Consider using the IRS primary residence exclusion. …
- Also, under a 1031 exchange, you can roll the proceeds from the sale of a rental or investment property into a like investment within 180 days.
Where can I buy NHAI tax free bonds?
These Capital Gain bonds can be purchased either from NHAI/ REC or from authorised brokers of these bonds. There is no online mechanism of purchasing these bonds and a person would be required to physically visit their office and fill in the physical form.
How do I avoid capital gains tax?
How to Minimize or Avoid Capital Gains Tax
- Invest for the long term. …
- Take advantage of tax-deferred retirement plans. …
- Use capital losses to offset gains. …
- Watch your holding periods. …
- Pick your cost basis.
Are NHAI bonds taxable?
The interest on the bonds is taxable at your slab rate. The bonds have a lock-in period of 5 years.
Which capital gain bonds is best?
54EC Bonds. 54EC bonds, or capital gains bonds, are one of the best way to save long-term capital gain tax. 54EC bonds are specifically meant for investors earning long-term capital gains and would like tax exemption on these gains.
Can I buy capital gain bonds from SBI?
Investors can invest the amount in SBI Capgains Plus under the Capital Gains Account Scheme 1988. And then you are eligible to claim exemption of LTCG i.e. Long Term Capital Gains Tax on sale of Capital Assets. Here’s a quick look at all features of Capgains Plus account.
Can NHAI 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.