What is sovereign gold scheme?
What is RBI Retail Direct Scheme? Prime Minister Narendra Modi announced last month the opening of the RBI Retail Direct Scheme, which allows individuals to buy treasury bills, dated securities, sovereign gold bonds (SGB), and state development loans (SDLs) directly from the primary and secondary markets.
How does sovereign gold bond scheme work?
Denomination/Value. The value of the bonds is assessed in multiples of gram(s) of gold, wherein the basic unit is 1 gram. The minimum initial investment is 1 gram of gold, and the upper limit is 4 Kg of gold per investor (individual and HUF). For entities such as trusts and universities, 20 Kg of gold is permissible.
How is sovereign gold bond interest calculated?
Sovereign Gold Bonds will be denominated in the multiples of a gram of gold with the minimum unit of 1 gram. The interest for the gold bonds will be 2.50% per annum which is payable semi-annually on the nominal value.
What happens after 8 years of Sovereign gold bond?
Is premature redemption allowed? Though the tenor of the bond is 8 years, early encashment/redemption of the bond is allowed after fifth year from the date of issue on coupon payment dates. The bond will be tradable on Exchanges, if held in demat form. It can also be transferred to any other eligible investor.
Is SGB taxable after 5 years?
In case of early redemption/encashment of the bond after the fifth year, the capital gains will be taxed. The tax rates applicable will be for long-term capital gains (LTCG) at 20% with added cess and indexation benefits. SGBs can be traded on a stock exchange if they are listed from the date notified by the RBI.
What happens after 8 years of Sovereign gold Bond?
Can I keep SGB after 8 years?
Can we sell SGB before maturity?
Yes, The maturity period of the sovereign gold bond is 8 years. However early encashment/redemption of the bond is allowed after fifth year from the date of issue on coupon payment dates. If you want to sell it even before 5 year you can sell it anytime through stock exchange if held in the demat form.
What is the price of SGB?
The issue price for Sovereign Gold Bond Scheme 2021-22, which will open for subscription for five days from November 29, has been fixed at Rs 4,791 per gram of gold, the Reserve Bank of India said on Friday.