Sovereign Gold Bond Scheme – The Reserve Bank of India (RBI) has announced early redemptions for 30 series of Sovereign Gold Bonds (SGBs) maturing between October 2024 and March 2025. The RBI has provided a calendar for repurchasing the bonds that have been completed in five years.
Sovereign Gold Bond Scheme 2024 – 2025
The next issue date for the Sovereign Gold Bond (SGB) is really important for investors who want to buy these bonds. The government tells us when we can subscribe to these bonds during the financial year. Usually, they announce the issue dates early, so we know when each batch of bonds will come out.
These Sovereign Gold Bonds are given by the Reserve Bank of India (RBI) for the Government of India. They are a safe way to invest in gold without needing to keep the gold physically with you. This makes it easier for people to invest in gold.
Knowing the next issue date is super important because it helps people plan when to make their purchases of SGBs. It lets them invest smartly and not miss out on this chance. So, keep an eye on those dates if you want to buy SGBs! Click to know more details about buying and selling on “GeM Portal”
What is a Sovereign Gold Bond next issue date?
The upcoming Sovereign Gold Bonds in 2024-25 are super interesting for people who want to invest. One main thing to know is that these Sovereign Gold Bonds offer a fixed interest rate, which is usually around 2.50% every year. You get paid this interest every six months. So, you not only get money when the gold price goes up but also receive regular payments!
Another cool thing about these bonds is their time period. They usually last for eight years, but you can take your money out after five years if you want. And guess what? These bonds are supported by the Government of India, which makes them a safe choice for investors.
Sovereign Gold Bonds can also be sold on stock exchanges. This means that if you want to sell them before the eight years are up, you can easily do that. Plus, you can buy these bonds in small amounts, like one gram of gold. This is great for small investors who may not have a lot of money.
There are also some awesome tax benefits when it comes to capital gains. You can even use these Sovereign Gold Bonds as collateral for loans, which makes them even more attractive! It looks like the new series will have all these good features for investors.
RBI Bonds New Updations
The new Sovereign Gold Bond Scheme for 2024-25 is coming with some cool features that will help investors a lot. First, the big news is about making it easier to subscribe. Now, you can apply online quicker using mobile banking and special apps. This is great because it saves time!
Another exciting update is for those who subscribe early. If you apply through digital platforms, you might get discounts on the gold bond price. Who doesn’t love discounts, right?
The interest rate for the bonds will stay at 2.50% every year. However, the government might change some tax rules a bit to make the scheme even better for you. So, it’s something to watch out for!
Also, the bonds can still be traded on stock markets. This means you can buy and sell them easily, giving you more choices about your money. If you want to know how gold prices are doing, you can check real-time updates on official sites. This will help you make smart choices about your investments.
Can anyone invest in the Sovereign Gold Bond Scheme?
Trusts, educational institutions, charitable trusts, and Hindu Undivided Families are among the investors who are eligible to invest in the SGB tranche (HUFs). Also qualified to invest is a resident of India as specified by the Foreign Exchange Management Act of 1999. The person can hold SGBs till early maturity in the event that their residence changes to somewhere else in the world.
Key highlights of the upcoming sovereign gold bond scheme 2024-25
| Feature | Details |
|---|---|
| Tenure | 8 years, with early redemption available after 5 years |
| Interest Rate | Fixed at 2.50% per annum, payable semi-annually |
| Issue Price | Determined based on the average gold price of the preceding week |
| Eligibility | Indian residents, HUFs, trusts, universities, and charitable institutions |
| Tradability | Bonds are tradable on stock exchanges, offering liquidity |
| Minimum Purchase | 1 gram of gold |
| Tax Benefits | Exempt from capital gains tax if held till maturity |
| Collateral | Bonds can be used as collateral for loans |
How to buy a sovereign gold bond online?
- Select platform: Choose a bank or stock exchange’s online portal to apply.
- Login: Use your internet banking credentials to log in.
- PAN requirement: Ensure you have your PAN card details ready, as it is mandatory.
- Select SGB: Choose the SGB issue available for subscription.
- Payment: Complete the payment via internet banking or UPI.
- Receive confirmation: Once payment is successful, you will receive a confirmation and the bond certificate in your email or demat account.
Sovereign Gold Bond Scheme Denomination
The SGBs will be measured in multiples of grammes of gold, with one gramme serving as the base unit.
What is the Tenor of SBG
The SGB will have an eight-year term with an early redemption option available following the fifth year on the interest due date.
Minimum Investment Size
One gramme of gold will be the minimum investment that is permitted.
Maximum Investment Limit
According to the government’s periodically updated regulations, each person may subscribe up to 4 kilogrammes, HUFs up to 4 kg, and trusts and other similar organisations up to 20 kg per fiscal year (April-March). A self-declaration to this effect will be received. SGBs purchased on the secondary market and those subscribed to under various tranches will be included in the annual ceiling.
Sovereign Gold Bond Scheme Benefits
SGBs are quite advantageous, which makes for a very profitable purchase. Since the investor has no need to physically retain or store the gold, both the storage and security issues are eliminated. Additionally, the investor receives their money back at the current gold market rate. As a result, the investor has more control over the timing and price of gold redemption.
Joint Holder
The 4 KG investment restriction only applies to the initial application in a joint holding scenario.
What is the SGB Issue Price?
As stated by the India Bullion and Jewellers Association Limited, the price of SGB shall be set in Indian Rupees using a simple average of the last three working days of the week before to the subscription period (IBJA). The issuance price of the SGBs would be reduced by Rs. 50 per gramme for investors who subscribe online and pay digitally.
Redemption Cost for SGB
Based on a straightforward average of gold 999 pure closing prices provided by IBJA Ltd over the previous three working days, the redemption price will be expressed in Indian Rupees.
Where to Purchase Sovereign Gold Bonds
Commercial banks, the Stock Holding Corporation of India Limited (SHCIL), the Clearing Corporation of India Limited (CCIL), designated post offices (as may be announced), and recognised stock exchanges, namely the National Stock Exchange of India Limited and the Bombay Stock Exchange Limited, will all be used to sell SGBs either directly or through agents.
Sovereign Gold Bond Scheme Interest Rate
The nominal value will be paid to investors at a fixed rate of 2.50 per cent annually, payable every other year.
SGB as Collateral
The SGBs may be used as loan security. It is necessary to fix the loan-to-value (LTV) ratio at the same level as the Reserve Bank’s standard gold loan.
Documents for KYC
The same know-your-customer (KYC) guidelines as for buying physical gold will apply. Voter identification, an Aadhaar card, a PAN card, a TAN card, a passport, and other KYC documents would be needed. Every application must be accompanied with the “PAN Number” that the Income Tax Department issues to individuals and other companies.
Tax treatment for SGB
According to the requirements of the Income Tax Act of 1961, interest on SGBs is taxable (43 of 1961). The capital gains that result from an individual’s redemption of SGB are not subject to tax.
The transfer of the SGB will result in long-term capital gains that are eligible for indexation benefits.
Sovereign Gold Bond Scheme Eligibility
The Sovereign Gold Bond Scheme requires that participants meet the following straightforward qualifying requirements.
- Indian residents – The Foreign Exchange Management Act of 1999 established the eligibility requirements, and this programme is exclusively available to Indian residents.
- Individuals/groups – As long as they are Indian residents, individuals, associations, trusts, HUFs, etc. are all eligible to invest in this scheme. One may invest in bonds jointly with other qualifying participants under the scheme.
- Minors – Parents or guardians may acquire this bond on behalf of minors.
Sovereign gold bond interest rate/return
- Fixed interest rate: The SGB scheme offers a 2.50% annual interest rate.
- Payment frequency: Interest is payable semi-annually to bondholders.
- Return on gold price: Investors benefit from both fixed interest and the appreciation of gold prices.
- Tax exemption: Interest earned is taxable, but capital gains on maturity are exempt from tax.
- Guaranteed income: Provides a steady, guaranteed income stream, apart from gold price fluctuations.
FAQ’s
How much may I invest, in minimum and maximum amounts?
The minimal amount of gold required to issue a sovereign gold bond is one gramme. Depending on the investor, there are different upper limits. The weight restriction for organisations like trusts and universities is 20 kilos.This restriction is set at 4 kg for people and HUFs.
How to pay using SGB.
Demand drafts, checks, electronic banking, and cash (up to a maximum of Rs. 20,000) are all acceptable payment methods for SGBs.
What Is the Scheme’s Bond Period?
The bond has a total tenor of eight years. After the fifth year, but not before, investors have the opportunity to leave the bond.
Is Trade allowed for SGB?
The SGBs will be allowed to trade.