Fixed Deposits & 54 EC Bonds

Introduction of Fixed Deposits:

A fixed deposit (FD) is a financial instrument provided by Indian banks and Non-Banking Financial Corporations which provides investors with a higher rate of interest than a regular savings account, until the given maturity date. It may or may not require the creation of a separate account. They are considered to be very safe investments. Term deposits in India are used to denote a larger class of investments with varying levels of liquidity.

Why opt for Corporate Fixed Deposits?

  • If your risk appetite is low, fixed deposits are perfect for you. Since most of the instruments are rated, corporate fixed deposits have a very high safety level
  • Attractive returns at interest rates higher than banks’ Fixed Deposits
  • Higher Interest rates for senior citizens
  • High liquidity; most of these issuers offer 75% of the investment amount as loan @ 2% over the interest rate on the deposit, as well as a pre-mature withdrawal Option
  • Potential to earn compounding interest on your money by reinvesting the principal amount along with the interest earned
  • Flexible tenure - various tenures are ranging from 1 to 7 years
  • You can choose interest frequency; most issuers offer monthly, quarterly, bi-annual and annual cumulative deposits
  • You get direct ECS credit facility for interest payments or advance interest warrants for the year issued by most issuers

Fixed Deposits offered by Evershine Wealth Advisors

Click Here to Know the current FD Rates

 What are 54ec Bonds?

54 EC bonds, or capital gains bonds, are one of the best ways to save long-term capital gain tax. 54 EC bonds are specifically meant for investors earning long-term capital gains and would like tax exemption on these gains. The tax deduction is available under section 54 EC of the Income Tax Act. 54 EC bonds do not allow any tax exemption on short-term capital gains tax. Invest in 54 EC bonds to get benefits of tax deduction. The maximum limit for investing in 54 EC bonds is Rs. 50,00,000.

The eligible bonds under Section 54 EC offered by Evershine Wealth Advisors

  • REC (Rural Electrification Corporation Ltd)
  • PFC (Power Finance Corporation Ltd)
  • NHAI (National Highways Authority of India)
  • IRFC (Indian Railway Finance Corporation)

Click Here to get the forms and current Rates offered for 54ec Bonds

Key features of 54 EC Bonds

54EC bonds are popular investment instruments as investing in 54EC bonds allows investors to claim tax deductions on long-term capital gains. 54EC bonds also offer other features.

Safe and Secure: 54EC bonds are AAA rated.

Interest: Interest in 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 2019) and are non-transferable.

Investment amount: Minimum investment in 54EC bonds is 1 bond amounting to Rs. 10,000 and the maximum investment in 54EC bonds is 500 bonds amounting to Rs 50 lakhs in a financial year.

Interest Rate: 54EC bonds offer a 5.75% rate of interest payable annually. (*As on 21 Aug 2019 Subject to change as per regulations)

Key Benefits of 54EC Bonds

Individuals, as well as members of HUF, can make investments in 54EC bonds. You should invest in 54EC bonds within 6 months of transferring the capital assets. Take a look at the benefits of investing in 54EC bonds.

 *Information provided is in general and may vary from product or investor. Please refer to the offer document for the risk involved & tax liability before investing.



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