Difference between Tax Free/Tax Saving Capital Gain & Infra Bond

Everybody interested to invest in fixed income Bonds. Just received investor asking about can I take addition benefit(80c+) for investing in HUDCO/REC/PFC tax saving bonds. people interest to take additional benefit for tax purpose, but bonds name confusing, what’s benefit of these bonds. How I save Tax.

First clear about what type of tax purpose bonds available.

• Tax Free Bonds : The interest on these bonds is Tax Free to Investor. Tax benefit under Section 10(15) (iv) (h) of the Income Tax Act, 1961. Read more about tax-free bonds.
• Capital Gain Bond 54EC : These Bonds specifically meant for the investor who have earned long term capital gains & would like to save capital gain tax on them. If you sell your property and take long term gain then you invest in these type of bonds. Only 2 Bonds available under these category REC & NHAI Capital Gain Bond. Tax benefit under section 54 EC. (Read more Details How to - Capital Gain Bonds )
• Infrastructure Bonds : Income Tax payers can declare a reduction of up to Rs. 20,000 as per Section 80CCF by making investment in this products. This year 2012-13 Scheme is withdraw by Govt.

Note : The Rajiv Gandhi Equity Savings Scheme (RGESS) previously offered tax benefit under Section 80CCG, but the scheme was discontinued by the government from FY 2016-17.

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