IDFC 80CCF Tax Saving Infrastructure Bonds

IDFC has launched their own 80CCF infrastructure bonds, and these come with a slightly higher interest rate than the other bonds that have been released so far.

They carry a 9% annual interest rate, and IDFC has simplified the issue a little bit by having the option with only one maturity – that of ten years.

Like, the other 80CCF bonds, these will have the the annual interest payment or the cumulative option, and a buyback option after 5 years.

The issue opens on November 21, 2011 and closes on December 16, 2011. In the past they have appeared on online platforms like ICICI Direct and Edelweiss, so that’s one way to buy them, or as Austere suggested you can print the forms online and submit it in one of the collection centers.

And of course, there’s always the option of taking the help of financial advisers like Shiv to apply for them.

Here are some other details about the bonds.




Interest Rate


Cumulative but effectively 9%

Maturity Period

10 years

10 years

Buyback Option

5 years

5 years

Buyback Amount



Maturity Amount




After the lock in period of 5 years, the bond will list on the NSE and BSE.

For whatever it’s worth the issue is rated highly by ICRA and Fitch – both of them rated the issue AAA. To me, it doesn’t make a lot of sense to apply anything more than Rs. 20,000 and that too only on one of these 80CCF bonds, so if you have applied for something already then you are better off investing your money in any other bank fixed deposit which doesn’t have any lock in period and will have a slightly higher interest rate also.

A new question that I see appear a few times with respect to these bonds is if you need to buy it every year to get the tax benefit. I think the source of that question is the confusion between the tax benefit.

Please be cognizant of the fact that the interest is not tax free. The interest will be taxable every year, but the way you get the tax benefit is that the value of bonds that you buy gets reduced from your taxable salary, and that means you have to pay less tax.

The other question that I saw today was would you have to pay tax if you exercised the buyback and the answer to that is that buyback doesn’t affect how the bond is taxed.

If you took the annual interest option then the interest will be taxed every year, and if you took the cumulative option then you will be taxed capital gains. The face value of the bond will not be taxed.

I can’t quite think of anything else to cover about this issue – so if you have any comments let’s hear them and a special thanks to Shiv who informs me about these bonds quite in advance.

116 thoughts on “IDFC 80CCF Tax Saving Infrastructure Bonds”

  1. I purchased these bonds with buyback option effective 30/12/16. I received buyback amount for all 4 bonds but it has been withdrawn for 3 bonds. my denatured account shows no balance. whom to approach.

  2. Dear Sir,
    I have bought 4 bonds of IDFC in feb 2011.It is in physical form. I want to redeem these now.Pl inform how it can be done & whom i have to submit the papers.

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  4. I have opted for buyback option for IDFC bond 2011 after 5 years. Pl confirm whether buyback amount -interest portion is taxable or not. If taxable, pl indicated tax rate.

  5. lock period completed and the tax free bonds transferred to zero fund , in this case i want to know the exact position, and if i will take refund of these bonds than explain the tax liability.

  6. I have REC bond which was opted with annual interest payment. I think it is taxable income. May I know the percentage of tax or it is same as bank FD interest ?

  7. Can you please publish the various interest payment dates for various 80CCF bonds the way you have published for the Tax savings bonds? That way it would be helpful for all of us who have purchased these bonds.

  8. Dear Sir,
    In Feb.2012 I have invested Rs.20000/- for IDFC infrastructure bond from IDBI Bank-Indira Nagar branch at LUCKNOW(U.P.). But till now I have not received the bond. And this amount is deducted from my account.

    can you help me please.
    IDFC BOND application no.-21909890


    1. Hi Akhilesh,

      Your IDFC Infra Bond allotment done.
      You can contact your broker for your certificate . If your agent/broker know how to get certificate then you can received your certificate Within 15 days.
      Your certificate not deliver to you
      If any qurey after contact your agent then ask me how to do.

  9. i am in saudi arabia i send money to my himilayan bank account pls can u tel me how i can cheaquek my balance by online.


  11. Sir,
    I had invested Rs.20,000/- in IDFC infrastructure bond on 22nd February 2012 and my application No. is 41644143. So far I have not received any information on allotment of bond. Please confirm the status of this.
    Thanking you,
    yours faithfully
    Prakash Kumar

    1. Hi Mr. Prakash Kumar.. this is not IDFC’s or Karvy’s website so nobody here would be able to confirm the status of Bonds’ allotment to you. IDFC Infra Bonds – Tranche II issue is scheduled to close on March 5th and the co. delivers the Bond Certificates within 30 days after the closure of the issue. So you can expect the certificates to reach your address before April 5th. For any further info on your investment you need to contact either Karvy or IDFC.

  12. Sir,
    I had invested Rs.20,000/- in IDFC infrastructure bond on 22nd February 2012 and my application No. is 41644143. So far I have not received any information on allotment of bond. Please confirm the status of this.
    Thanking you,
    yours faithfully,

  13. what’s about its interest? whether it will be taxed again or tax free & If we withdraw on maturity or we apply for buy back option.

    1. Hi Mr. Nitin… Interest is taxable whether it is annually paid to you or it is under the cumulative option & paid to you when you exercise the Buyback facility or on maturity. It is taxable under all the options.

  14. what’s about its interest? whether it will be taxed again of tax free & If we withdraw on maturity or we apply for buy back option.

  15. please let me know if I will have to pay tax on capital amount of the sum investment in infrastructure bonds under 80 CCF at the time of redemption.

    1. Hi Dr. Neelang… Principal amount is not taxable at the time of redemption, only the interest income is taxable.

    1. Hi Vivek.. I’ve no clue how these bonds are getting traded in the markets and with such a huge premium. There is a lock-in period of 5 years before which one cannot sell these bonds.

  16. Hi Gaurav.. It is definite that you’ll have to pay tax on the interest income whether you choose annual option or cumulative. In the annual option, it is confirmed that you are required to show the interest income every year under “Income from Other Sources” and you should not avoid it. But in the cumulative option, different people have different opinions whether to show the interst income annually or at the end of 5th year when one decides to exercise the Buyback Facility.

    I think, under the cumulative option, one should pay tax on the interest income/capital gain after redeeming/selling these bonds after 5 years or on maturity after 10 years because one might sell these bonds on the exchanges when they start trading after 5 years.

  17. Hi Shiv/Manshu,
    Let say i buy 20k L&T this financial Yr. And i choose pay Annual interest option. And i want to buyback after 5 yrs. So when you say intrest is taxable, will i’ve to declare income from interest every year till next 5 yr? If yes can i avoid this by choosing cummulative option to avoid unnecessary tax calculations???

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