Section 54EC Capital Gains Tool 2026
Plan your property sale tax liability. Calculate how much LTCG tax you can save by investing in specified infrastructure bonds under Section 54EC.
Last updated: May 2026
Invest in REC, NHAI, PFC, or IRFC bonds within 6 months.
Post-2024 Budget: 12.5% flat for property LTCG.
Total Tax Saved
Net Tax Payable
Remaining LTCG Liability
Lock-in Period: 54EC Bonds have a 5-year lock-in. Interest is taxable, but the capital gains invested are tax-exempt.
Saving Property Tax via 54EC Bonds
Under Section 54EC of the Income Tax Act, taxpayers can claim exemption from Long-Term Capital Gains (LTCG) arising from the sale of land or building by investing the gain amount into specified Capital Gains Bonds.
In 2026, the primary issuers of these bonds are REC, NHAI,PFC, and IRFC. The maximum investment allowed per financial year is ₹50 Lakhs. This is a popular strategy for individuals who don't wish to reinvest their gains into another residential property (as required by Section 54).
How to use this calculator
- 1Calculate LTCG — Determine your Long-Term Capital Gain (Sale Price minus Indexed Cost of Acquisition).
- 2Plan Bond Investment — Decide how much of the gain you want to invest in 54EC bonds (up to ₹50 Lakhs).
- 3Check Tax Saved — The tool calculates the tax saved based on the 12.5% flat LTCG rate (post-2024 budget rules).
- 4Observe Deadlines — You must invest in these bonds within 6 months of the date of transfer of the property.
Formula & example
Tax Saved = Bond Investment × LTCG Tax Rate (12.5%)
Example: LTCG of ₹80 Lakhs. Invest ₹50 Lakhs in REC Bonds.
- Tax Liability without Bonds (12.5%): ₹10 Lakhs
- Tax Saved on Bond Investment: ₹6.25 Lakhs
- Net Tax Payable: ₹3.75 Lakhs
Benefits
Guaranteed Safety
Bonds are issued by government-backed entities like NHAI and REC, ensuring very high safety of principal.
No Property Hassle
Exempt your tax without the need to buy, maintain, or manage another residential house.
Immediate Liquidity
While the principal is locked for 5 years, you receive annual interest payments.
Use cases
Retirees
Selling an old family property and wanting a safe, tax-exempt income stream.
Estate Liquidation
Heirs selling inherited property and needing to manage the LTCG tax impact.
Plot Sellers
Exempting gains from the sale of vacant land where other house-purchase exemptions might not apply.
Frequently asked questions
Can I sell the bonds before 5 years?+
No, the bonds are non-transferable and cannot be sold or used as collateral for a loan before the 5-year period ends without losing the tax benefit.
What is the interest rate on 54EC bonds?+
As of {year}, the interest rate is typically around 5.25% per annum, paid annually.
Is the interest tax-free?+
No. While the principal investment helps you save Capital Gains tax, the interest you earn annually is added to your total income and taxed at your slab rate.