Sovereign Gold Bond: If you are an investor in Sovereign Gold Bond, then this is useful news for you. Actually, the Reserve Bank of India (RBI) has said that investors of Sovereign Gold Bond 2020-21 Series-II will become eligible for premature redemption from November 19, 2025. This is the same series which was released on May 19, 2020. If investors of this series withdraw their money now, they can get a bumper return of 171.5% on their investment.
RBI has fixed the redemption price for this series at Rs 12,330 per unit. This price has been decided by India Bullion and Jewelers Association Limited (IBJA) on the basis of the average closing price of gold of 999 purity for three trading days (14, 17 and 18 November 2025).
huge profits for investors
In 2020, this bond was issued at a price of Rs 4,540 per gram. Now the redemption price is Rs 12,330 per gram i.e. a profit of Rs 7,790 per gram, which is approximately 171.5 percent return. On top of this, investors have also been getting 2.5 percent annual interest every 6 months. Overall, these returns are much higher than traditional investment instruments like FD or savings schemes.
How to do premature redemption?
Investors can apply at their bank, post office or from where the bond was purchased. Usually the redemption request has to be submitted a few days in advance.
What is SGB Scheme?
The Government of India started this scheme to reduce the domestic gold demand and to provide people with a secure financial instrument instead of buying physical gold. These bonds are issued for 8 years, but there is an option to exit after 5 years. Sovereign Gold Bond also offers 2.5% annual interest, which comes to your bank account every 6 months.
How is tax on sovereign gold bonds
The 2.5 percent interest received on Sovereign Gold Bond is taxable but when the investor redeems the bond through RBI, then there is no capital gains tax on it. If an investor has earned capital gain by selling sovereign gold bonds on the exchange, then in that case he gets indexation benefit.
