Sovereign Gold Bonds

Sovereign Gold Bonds Latest News

The Budget has clarified that the capital gains tax exemption on sovereign gold bonds will not apply to investors who purchase them in the secondary market and hold them to maturity.

About Sovereign Gold Bonds

• These bonds are government securities denominated in grams of gold.
• The SGB Scheme was first launched by the Government of India (GOI) on October 30, 2015. 
• They are substitutes for holding physical gold. Investors have to pay the issue price, and the bonds will be redeemed upon maturity.
• Issuance: The bond is issued by the Reserve Bank on behalf of the GOI.
• Eligible to invest in the SGBs: The bonds will be restricted for sale to resident Indian entities, including individuals, Hindu Undivided Family (HUF), Trusts, Universities and Charitable Institutions.
• Investment Limits in SGBs
  • The bonds are issued in denominations of one gram of gold and in multiples thereof.
  • The minimum investment in the bond shall be one gram, with a maximum subscription limit of 4 kg for individuals, 4 kg for HUFs, and 20 kg for trusts.
• In case of joint holding, the investment limit of 4 KG will be applied to the first applicant only.
• Term: The term of the bond will be for a period of 8 years, with an exit option in the 5th, 6th, and 7th years, to be exercised on the interest payment dates.
• Bonds are sold through offices or branches of Nationalised Banks, Scheduled Private Banks, Scheduled Foreign Banks, designated Post Offices, Stock Holding Corporation of India Ltd. (SHCIL), and the authorised stock exchanges either directly or through their agents.

Source: THBS

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