Section 54EC of Income Tax Act: Capital Gain Exemption

Selling long-term immovable assets like land or buildings at a generous profit margin is a moment of joy, but this long-term capital gain (LTCG) is also taxable in India. However, the taxpayer can avoid or reduce this tax liability by claiming a tax exemption according to Section 54EC of the Income Tax Act.

Section 54EC allows the taxpayer to invest the capital gain in government-secured bonds within the time frame of six months from the date of sale. Such bonds are known as capital gain bonds, and investing in these bonds is quite a famous strategy among taxpayers to avoid or reduce the tax liability on the capital gains of immovable property. This blog guide includes everything you need to know about Section 54EC of the Income Tax for NRIs and Indian residents.