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The government now permits 19 private banks and modern payment systems for CGAS deposits, making capital gains exemptions easier and faster for taxpayers.
News18
In a significant step, the Central government has now authorised 19 private banks to receive deposits under the Capital Gains Accounts scheme in additional to existing pubic sector banks such as SBI. The Ministry of Finance introduced significant amendments to the CGAS through the notification of the Capital Gains Accounts (Second Amendment) Scheme, 2025.
Moreover, a slew of modern payment systems such as UPI, Net Banking, IMPS, NEFT, RTGS, and credit/debit cards are now allowed to deposit amount in account opened under CGAS replacing the earlier dependence on cheques and demand drafts.
This shift is expected to prevent delays in deposit clearance, especially for taxpayers filing returns close to deadlines, significantly reducing the risk of losing tax benefits due to bank holidays, cheque clearance delays, or last-minute procedural issues, explains Preeti Sharma, Partner, Global Employer Services, Tax & Regulatory Services, BDO India
Taxpayers will be able to submit closure requests online using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC), eliminating the need for physical documents or bank visits.
These initiatives will help ease access and reduce bottlenecks for those reinvesting proceeds under Sections 54, 54F, 54GA, etc. of the Income‑tax Act. “For taxpayers, especially those in the property and asset‑transfer cohort, the message is clear: if you’ve realised a long‑term capital gain and wish to claim exemptions under Sections 54, 54F, 54G or 54GA, you can deposit unutilised gains into a CGAS account before your ITR due date to preserve the exemption,” says CA Shefali Mundra, Tax Expert at ClearTax.
What Is the Capital Gains Account Scheme (CGAS)?
The Capital Gain Account Scheme (CGAS) is a special facility under the Income-tax Act that helps taxpayers claim capital gains tax exemption when they are unable to immediately reinvest the proceeds from selling a long-term capital asset—such as a house, land, or property.
Under the law, taxpayers can avoid paying long-term capital gains tax if they reinvest the gain or sale amount in a new residential property within the prescribed timelines. However, many people are unable to make this investment decision in the same financial year.
By depositing the unutilised capital gain into a CGAS account before the due date of filing the income-tax return, taxpayers can preserve their eligibility for exemption. The funds deposited can later be used to buy or construct a new property, and the tax benefit still applies.
If a taxpayer fails to deposit the amount in CGAS within the deadline, they may lose the exemption—even if they reinvest the money later.
Until now, CGAS could be opened only with a few selected government banks, and users often faced operational hurdles due to the lack of digital access or online services linked to these accounts, adds Sharma.
The authorised banks are: HDFC Bank, ICICI Bank, Axis Bank, City Union Bank, DCB Bank, Federal Bank, IDFC FIRST Bank, IndusInd Bank, Jammu & Kashmir Bank, Karnataka Bank, Karur Vysya Bank, Kotak Mahindra Bank, RBL Bank, South Indian Bank, Yes Bank, Dhanlaxmi Bank, Bandhan Bank, CSB Bank and Tamilnad Mercantile Bank. (Except Rural Branches)
The scheme has two types of deposit accounts:
Under the CGAS, taxpayers can choose between two types of accounts. Account-A works like a regular savings account, where money can be withdrawn as needed and earns normal savings interest. Account-B functions like a term deposit, which can be cumulative or non-cumulative. Withdrawals from Account-B are allowed only after the deposit matures. Deposits into either account can be made in one lump sum or in instalments before the income-tax return due date.
A Capital Gain Term Deposit Account, which falls under Account-B, serves as a dedicated parking option for long-term capital gains. The funds remain locked in until the taxpayer reinvests them in a new property or eligible asset to claim the tax exemption.
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
November 21, 2025, 16:22 IST
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