My wife and I have sold a jointly owned property(1st name wife 2nd name me) and as such the CG tax liability devolves on both.
We want to invest the amount in CG bonds as we have no intention of buying any other property.
We also have a demat account in the same order i.e. 1.wife 2. me. Can we buy the CG bond via demat into our joint demat account and will the same bond apply to us both for Income Tax purposes with half the amount applicable to each of us i.e. if the tax liability is 5 Lakhs and we buy a SINGLE 5 Lakh CG bond(dematted) then can we show 2.5 Lakh each in our IT returns for FY25-26 with reference to the SAME BOND (dematted)
OR do we have to buy two separate bonds of 2.5 Lakhs each in our individual names ?
You cannot claim capital gains exemption jointly on a single CG bond investment. Even if the property and demat account are jointly held, the exemption applies only to the person in whose name the bond is issued (the first holder). Therefore, if you buy one ₹5 lakh bond in joint names, only your wife (as first holder) can claim the exemption. To claim the benefit separately, both of you should invest in your own names e.g., ₹2.5 lakh each, so that each can claim exemption for their respective share of capital gains in their individual tax returns.
Would appreciate if you could clarify my follow up query.
Based on your input I purchased 2 IRFC CG bonds (self and wife) on 21st Oct 25.
The 6 month dead line after sale transfer is 3rd Nov 25 for purchase of the CG bonds.
The IRFC General document/issue highlight available on (Indian Railways Finance Corporation Limited) clearly states that the deemed allotment date is the last day of the month in which the payment is realized. I purchased the bonds online from the above portal (serviced by kfintech).
Now kfintech has got back stating that as PER THEIR INTERNAL PROCESS the allotment will happen by 15th Nov 25 as the purchase/payment was made after 15th Oct 25. This is in violation of the IRFC guideline of deemed date which is in the public domain and not kfintech’s internal process.
As I have no control on kfintech - my question is the status of CG exemption in case the allotment happens on 15th Nov 25 i.e. post the cut off date of 3rd Nov 25. Can I still claim exemption when I file my returns or will I be liable for CG tax ?
OR will the fact that payment was received by IRFC on 21st October 25 qualify as having purchased before the 6 month cut off date of sale transfer and allow the CG exemption claim under 54EC ?