Capital Gain Bonds Update: Section 54EC May Shift To Section 85 – What It Means For Invest

Capital gain bonds have always been one of the most trusted ways to save tax on long-term capital gains in India. For years, taxpayers have relied on Section 54EC of the Income Tax Act to reduce their tax burden after selling property.

However, a major update is emerging — under the new Income Tax Bill 2025, Section 54EC is proposed to be replaced or restructured under Clause 85 (Section 85).

This change is important for investors, property sellers, and financial planners. Let’s understand this update in simple words and what it means for your tax planning.

What is Section 54EC (Current Rule)?

Before understanding the new update, let’s quickly revise the current system.

Under Section 54EC, you can save long-term https://www.rrfinance.com/O ...">capital gains Bonds by investing in capital gain bonds within 6 months of selling a property.