The series I (2017-2018) of Sovereign Gold Bond scheme is open for subscription from 24th - 28th April,2017. Sovereign Gold Bonds are Government securities denominated in multiples of gram(s) of gold. They are substitute for investment in physical gold. To buy the bond, investor has to pay the issue price in cash to an authorised SEBI Broker. On redemption, cash is deposited into the investor's registered bank account. These Bonds are issued by the Reserve Bank of India on behalf of the Government of India and are traded on stock exchange.
The Sovereign Gold Bonds will be available both in demat and paper form.
The tenor of the bond is for a minimum of 8 years with option to exit in 5th, 6th and 7th years.
They will carry sovereign guarantee both on the capital invested and the interest.
Bonds can be used as collateral for loans.
Bonds would be allowed to be traded on exchanges to allow early exits for investors who may so desire.
Further, bonds would be allowed to be traded on exchanges to allow early exits for investors who may so desire.
Capital gain tax arising on redemption of SGB to an individual has been exempted. The indexation benefit will be provided to LTCG arising to any person on transfer of bonds. The department of revenue has said that they will consider indexation benefit if bond is transferred before maturity and complete capital gains tax exemption at the time of redemption.
Sovereign Gold Bonds will be issued on payment of rupees and denominated in grams of gold. Minimum investment in the bond shall be 1 grams. The bonds can be bought by Indian residents or entities and is capped at 500 grams.
Investors can apply for the bonds through scheduled commercial banks and designated post offices. NBFCs, National Saving Certificate (NSC) agents and others, can act as agents. They would be authorised to collect the application form and submit in banks and post offices.
BSE and NSE are included as receiving offices, apart from the commercial banks, SHCIL, designated post offices