Frequently Asked Questions

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Taxation on Returns

Are returns earned from my bond investment taxable?


For interest earned from Taxable Bonds, the earnings are taxable. For interests earned from Tax-Free Bonds, the earnings are 100% tax-free. Also, capital gains earned from selling any Bond (taxable and tax-free) before maturity are subject to capital gains taxation rules. Here is a blog that explains Taxation on Gains from Bond Investments.