Sovereign Gold Bond Scheme 2020-21 Series-3 Open from Today

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SGB Scheme: Sovereign Gold Bond (SGB) Scheme third series for the year 2020-21 is scheduled to open for subscription from today, June 8. This will last to June 12. They are a part of the Union Government’s market-borrowing programme. Reserve Bank of India (RBI) issue these bonds.

The third series installment will be released on 16 June. Reserve Bank of India (RBI) has informed that the issue price for Sovereign Gold Bond has been fixed at Rs 4,677 per gram. Earlier RBI said that the central government will issue sovereign gold bonds in 6 installments between April 20 and September. Two series have been over so far.

Sovereign Gold Bond

The price of gold is determined on the basis of a simple average of the closing price 999-purity gold published by the Mumbai-based India Bullion and Jewellers Association (IBJA) for the last three working days of the week preceding subscription. A fixed-rate of 2.5 percent per annum is applicable to the SGBs, payable semi-annually. The minimum permissible amount allowed for investment in SGB is one gram of gold.

How to Buy Sovereign Gold Bond?

SGB Scheme Conditions & Limitations

SGBs can be bought by individuals, Hindu Undivided Families (HUFs), charitable trusts, and universities. You can invest in them through commercial banks, Stock Holding Corporation, designated post offices and stock exchanges BSE and NSE. The lock-in period is fixed for eight years but one can close it after five years.

For an individual or HUFs, the investment is fixed at a minimum of one gram and a maximum of four kilograms of gold in a given financial year. For trusts and universities, the limit is up to 20kg in a financial year.

SGB Scheme Dates

This is the third series of the year 2020-21. The remaining series will be scheduled on

  •  2020-21 Series IV: July 6-10, 2020
  • 2020-21 Series V: August 3-7, 2020
  • 2020-21 Series VI: August 31-September 4, 2020

The interest in gold bonds is taxable as per the provision of the Income Tax Act. The capital gains tax arising on redemption of SGB to an individual is, however, exempted. The indexation benefits are provided to long term capital gains arising to any person on transfer of bond. It is advisable to make use of it to invest in and for safe earning.

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