The Reserve Bank of India (RBI) has announced the premature redemption price of the Sovereign Gold Bond scheme SGB 2018-19 Series-V due on July 22, 2026. SGBs have an eight-year duration, however, premature redemption of the Gold Bond is permitted after the fifth year from the date of issue of such Gold Bond on the date on which interest is payable.
The next due date of premature redemption of the 2018-19 Series-V tranche will be on July 22, 2026. Accordingly, the redemption price for premature redemption due on July 22, 2026, shall be Rs 14,218 per unit of SGB based on the simple average of the closing price of gold for the three business days i.e., July 17, July 20, and July 21, 2026.
Sovereign Gold Bonds SGB 2018-19 Series-V was open between January 14–18, 2019, with the settlement date January 22, 2019. The issue price of the Bond during the subscription period was Rs 3,214 per gram and Rs 3,164 for the digital purchase, after a discount of Rs 50.
The redemption price of SGB is based on the simple average of the closing price of gold of 999 purity of the previous three business days from the date of redemption, as published by the India Bullion and Jewellers Association Ltd (IBJA).
Returns for Gold Bond investors
Investors in the Sovereign Gold Bond (SGB) scheme SGB 2018-19 Series-V due on July 22 are expected to gain 350% over seven years and six months, equating to an annualized return of over 22%. There was an additional return of 2.5%, half-yearly paid to the SGB investors.
Gold price in India is Rs 14,288 per gram as of July 21, having gained Rs 111 per gram over the previous day’s close.
Sovereign Gold Bond Taxation
A big change has been introduced in the taxation of SGBs in Budget 2026. The capital gains from gold bonds will be exempt from tax if the bond was purchased during primary issuance and held for a full 8 years until maturity. Premature withdrawal through the RBI does not qualify for this exemption.
Capital gains from SGBs will be taxable if they are bought in the secondary market, sold in the secondary market, or redeemed during a premature withdrawal window, regardless of the original purchase method.
Disclaimer: This article is intended for general awareness only and should not be construed as tax or investment advice. Tax treatment of SGB gains may vary based on individual circumstances and is subject to change. Readers are advised to consult a SEBI-registered investment advisor or qualified tax professional before making any redemption or investment decisions. Financial Express is not responsible for any decisions made based on this information.
