What is the benefit of Sovereign gold Bond?

What is the benefit of Sovereign gold Bond?

What is the benefit of Sovereign gold Bond?

A sovereign gold bond is a better investment than physical gold because of many reasons. Firstly, these gold bonds allow you to get a lower price than physical gold when applied online. Secondly, you get a fixed interest rate on these gold bonds. Thirdly, gold bonds have no holding or storage cost.

How do I redeem Sovereign gold Bond?

Investors have to submit a redemption request to the bank/post office or agent they purchased the bonds from at least one day before the payment date. Gains on SGBs are tax-free on maturity.

Which banks provide sovereign gold bonds?


  • To be issued by Reserve Bank India on behalf of the Government of India.
  • The Bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram.
  • The tenor of the Bond will be for a period of 8 years with exit option in 5th, 6th and 7th year, to be exercised on the interest payment dates.

Is it worth buying sovereign gold bonds?

Since the investment in gold through SGB earns you interest as well as the capital gains at redemption are tax-free, you should invest in these bonds to guard you against any inflation and for diversification of your portfolio.

Is sovereign gold bond tax free?

The interest on Sovereign Gold Bonds is taxable as per the provisions of the IT Act, 1961. In the case of SGB redemption, the capital gains tax applicable to an individual is exempted.

Is Sovereign gold Bond tax free?

Can I sell Sovereign gold Bond anytime?

Early redemption The bonds can be prematurely redeemed or encashed after the expiry of five years from the date of issue. The encashment can be done on the coupon-paying dates of the bond. A subscriber seeking premature exit must approach the bank, post office or SHCIL 30 days before the coupon date.

Can SGB be sold before maturity?

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 sovereign gold bond worth it?

Sovereign Gold Bonds have none of the risks that are associated with physical gold, except the market risks. There are no hefty designing or wasting charges here. Moreover, SGBs earn interest, unlike physical gold which is an idle investment.