RBI has announced the exit window for investors holding the SGB (Sovereign Gold Bond) 2020-21 series VII round for premature redemption from 20 April 2026. This early redemption scheme helps investors to book profits, driven by a sharp increase in the gold price over the last five years, along with the yearly interest rate.
The minimum amount of redemption for sovereign gold bonds for this tranche has been fixed at Rs 15,254 per unit as per RBI. The amount is calculated as the simple closing price of 999-purity gold for the three working days preceding the date of redemption published by IBJA (India Bullion and Jewellers Association).
How Are Sovereign Gold Bonds Taxed?
The capital gains treatment depends on how the bonds are held from a tax perspective. Capital gains on redemption remain tax-exempt only for original subscribers who hold sovereign gold bonds until the maturity date. Redemption before maturity or gains from bonds sold are taxed as long-term capital gains, which applies if the holding exceeds a year, while the shorter holdings are taxed at applicable slab rates. If you purchase bonds from the secondary market, then they are not eligible for a capital gains exemption if you redeem the bonds.
Also, the SGB (Sovereign Gold Bond) future is quite uncertain. There can be no new SGB (Sovereign Gold Bond) issuances from 2027, as RBI has announced, and the government has not released a fresh issuance as of April 2026.
How To Redeem Sovereign Gold Bonds?
For those investors choosing premature redemption, the request might be submitted before the post office, SHCIL, or bank branch where the SGB (Sovereign Gold Bond) was purchased, so that the redemption process will initiate efficiently.
Investors are already informed a month before about redemption or bond maturity. The redemption proceeds are credited directly to the bank accounts registered with the investment records.
If there are any personal information changes, such as email address, bank account, or mobile number, ensure to update the details with SHCIL (Stock Holding Corporation of India Limited), bank, and post office to avoid settlement delays.
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