Are NHAI bonds safe?
The bonds issued by the NHAI are rated AAA by CRISIL and CARE which prominent rating agencies of India. AAA is the highest rating that may be assigned to an issue of bonds by a major rating agency. So as per rating given by the Agencies these bonds are safe to invest.
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. Tenure: 54EC bonds come with a lock-in period of 5 years (effective from April 2018) and are non-transferable.
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.
Is interest from NHAI bonds taxable?
The interest on the bonds is taxable at your slab rate. The bonds have a lock-in period of 5 years.
Who can invest in NHAI bonds?
These bonds are offered to investors who earned long-term capital gains from land or building or both and would like tax exemption on these gains. The eligible bonds under section 54EC include bonds on offer by Rural Electrification Corporation Ltd (REC) and National Highways Authority of India (NHAI).
What is the interest rate on NHAI bonds?
5.75\%
These Capital Gain Bonds which help in saving tax can only be issued by the National Highway Authority of India (NHAI) or the Rural Electrification Corporation of India (REC). The Interest Rate on the Capital Gains Bonds is 5.75\%. The Interest @ 5.75\% is payable annually by both NHAI as well as REC.
Where can I buy NHAI tax free bonds?
NHAI Tax Free Bonds
| Listing | Both BSE & NSE |
|---|---|
| Tenure | 10 years |
| Registrar to the Issue | Karvy Computershare Private Limited |
| Series of Bonds# | Tranche II Series 1A |
| Frequency of Interest Payment | Annual |
What are the disadvantages of bonds?
The disadvantages of bonds include rising interest rates, market volatility and credit risk. Bond prices rise when rates fall and fall when rates rise. Your bond portfolio could suffer market price losses in a rising rate environment.
How do I redeem my NHAI bonds?
Bonds will be automatically redeemed by NHAI 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.
Does NHAI deduct TDS on bonds?
Both REC and NHAI bonds offer an interest rate of 5.75\% per annum, payable annually. Interest earned from 54EC bonds is taxable; however, no TDS is deducted on interest.
How can I avoid capital gains tax in India?
Exemptions from your Gains that Save Tax Section 54F (applicable in case its a long term capital asset)
- Purchase one house within 1 year before the date of transfer or 2 years after that.
- Construct one house within 3 years after the date of transfer.
- You do not sell this house within 3 years of purchase or construction.
How do I buy NHAI tax free bonds?
How to Invest in NHAI Tax Free Bonds?
- Primary Market: When the company issues bonds to the public, the investor can subscribe by applying online or offline.
- Exchange: Investor(s) can buy and sell these bonds on the stock market.
What is the interest rate on NHAI capital gains bonds?
In sync with the declining rates in the economy, National Highways Authority of India (NHAI) and REC Ltd have cut the interest rate on their capital gains bonds from 5.75\% to 5\% from 1 August. The lower rate will only apply to fresh bonds where payment by the concerned institution has been received after 1 August.
How safe are rerecl and NHAI bonds?
RECL and NHAI, both are Government of India enterprises and their bonds are virtually guaranteed by the Central Government. In event of default, which is unlikely to begin with, the Central Government will pay the holders of the bonds from the Consolidated Fund of India, or any other source. So I am going to say yes, the bonds are completely safe.
Can I reduce capital gains tax on investment in NHAI and Rec?
The reduction will not apply on existing bonds. Investment in NHAI and REC up to ₹ 50 lakh offers a deduction from capital gains tax under Section 54 EC of the Income Tax Act. Such investment has to be made within six months of the transfer of the capital asset. What the bar on digital gold sale by stock brokers mean ….
How to fill NHAI 54EC capital gain bond application form?
– Take print of the Application Form on A4 size paper. Click here to find filled sample NHAI 54EC Capital Gain Bond Application Form to refer and avoid mistakes 1] PAN Card and Address Proof Photo Copy self-attested by applicant. 2] One Cancelled Cheque copy. (for ECS/RTGS/NEFT payment of Interest /Maturity Amount.)