Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Sovereign Gold Bond is a government security denominated in grams of gold, offering periodic interest plus gold price linked redemption value.
SGBs are government gold bonds — you earn 2.5% interest yearly plus gains if gold prices rise, with tax benefits on maturity.
Issued by RBI on behalf of Government of India. 8-year tenure with exit from year 5. Capital gains tax exempt on redemption if held to maturity. 2.5% semi-annual interest taxable at slab. Demat or paper form available.
Invest ₹5 lakh in SGB at ₹6,000/gram (≈83 grams). Earn ₹12,500 yearly interest. If gold hits ₹7,000/gram at maturity, redemption value ≈ ₹5.83 lakh plus accumulated interest.
Secondary market trading on exchange possible from year 1, but liquidity varies. Early redemption allowed from 5th year on specified dates.
SGB offers interest and maturity tax exemption. ETF offers continuous liquidity and no lock-in. Choose based on horizon and tax profile.
Individual limit is 4 kg per fiscal year in primary issuance, higher for trusts and other entities per RBI notification.