What is deduction under section 54EC?

What is deduction under section 54EC?

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.

Is REC bonds taxable on maturity?

It should be noted that the interest is not tax free and tax on interest would be liable to be paid as per the income tax slabs of the taxpayer. Thus, only the amount invested is exempted from Capital Gains Tax. The Interest that is earned on these bonds is liable to income tax.

What is the lock in period for capital gain bonds?

Capital-gain bonds have a lock-in period of five years and offer annual interest of 5 per cent. The interest income is added to the taxable income and taxed as per the applicable slab.

Who has right to claim fixed assets?

As per section 32 of Income Tax Act, 1961, a assessee is entitled to claim depreciation on fixed assets only if the following conditions are satisfied:

• Assessee must be owner of the asset – registered owner need not be necessary.
• The asset must be used for the purposes of business or profession.

How can I buy 54 EC bonds?

Step 1

1. Click the “Fill a New Form online” button for the bond issuer you prefer.
2. Fill the application form online and submit.
3. You will get an SMS on successful application submission.
4. Download the duly filled application form.
5. Take a print out of the above form and attest the signatures by all applicant(s).

Are capital gain bonds safe?

Safe and Secure: 54EC bonds are AAA rated. Interest: Interest on 54EC bonds is taxable. No TDS is deducted on interest from 54EC bonds and wealth tax is exempted. 10,000 and the maximum investment in 54EC bonds is 500 bonds amounting to Rs 50 lakhs in a financial year.

Is a laptop an asset?

Thus, a laptop computer could be considered a fixed asset (as long as its cost exceeds the capitalization limit).

What is the latest amendment to section 54EC?

Amendment of section 54EC Amendment of section 54EC. 21. In section 54EC of the Income-tax Act, with effect from the 1st day of April, 2019,— (a) in sub-section (1), after the words “long-term capital asset”, the words “, being land or building or both,” shall be inserted;

What are section 54EC capital gain bonds?

Capital Gain Bonds issued under Section 54EC by NHAI or REC is one of the best ways of saving tax on long-term capital gains. The lock-in period of section 54EC Capital Gain Bonds has increased from 3 years to 5 years. Know everything about 54ec bonds at Karvy Corporate.

What is section 54EC of Income Tax Act 1961?

Section 54EC of Income Tax Act 1961 provides for tax exemption on capital gains from sale of any Long Term Asset (original asset) provided that capital gains are invested in specified bonds (new asset) within a period of 6 months after the date of transfer of original asset.

What are the tax exemptions available under Section 54?

However, there are certain exemptions available under Section 54, Section 54B, Section 54EC and Section 54F of the Income Tax Act 1961. As of FY 2018-19, exemption under Section 54EC applies only to transfer of long term capital assets specifically land, building or both.