Ministry of Finance grants IREDA bonds tax-exempt status

The Ministry of Finance, through the Central Board of Direct Taxes, has notified that bonds issued by Indian Renewable Energy Development Agency Limited (IREDA) will qualify as ‘long-term specified assets’ under section 54EC of the Income-tax Act, 1961 from July 9, 2025. This enables eligible investors to claim exemption on long-term capital gains up to Rs 5 million per financial year by investing in IREDA bonds redeemable after five years. The proceeds from these bonds will be used exclusively to finance renewable energy projects with self-sustaining revenue streams.