Details of Sovereign Gold Bond Scheme (SGB)- 2020

Introduction- Sovereign Gold Bond (SGB) Scheme 2020

Following are the details of the Sovereign Gold Bonds (SGB) for 2020 (under the Sovereign Gold Bond Scheme. The Sovereign Gold Bonds are considered a decent alternative to buying physical gold.

Dates- Sovereign Gold Bond Scheme (SGB)- 2020

Dates for Sovereign Gold Bond Scheme (SGB)- 2020
Sr. NoSubscription WindowAllotment DateTranche
0113-Jan to 17-Jan-202021 January 20202019-20 Series VIII
0203-Feb to 07-Feb 202011 February 20202019-20 Series IX
0302-Mar to 06-Mar 202011 March 20202019-20 Series X
0420-Apr to 24-Apr 202028 April 20202020-21 Series I
0511-May to 15-May 202019 May 20202020-21 Series II
0608-Jun to 12-Jun 202016 June 20202020-21 Series III
0706-Jul to 10-Jul 202014 July 2020
2020-21 Series IV
0803-Aug to 07-Aug 202011 August 2020
2020-21 Series V
0931-Aug to 04-Sep 202008 September 20202020-21 Series VI
1012-Oct to 16-Oct 202020 October 20202020-21 Series VII
1109-Nov to 13-Nov 202018 November 20202020-21 Series VIII
1228-Dec 2020 to 01 Jan 202105 January 20212020-21 Series IX

FAQs- Sovereign Gold Bond (SGB) 2020

01. What is the eligibility for investing in SGB?

The Bonds under this Scheme may be held by a person resident in India, being an individual, (in his capacity as such individual, or on behalf of minor child, or jointly with any other individual), a Trust, HUFs, Charitable Institution and University. 

02. What is the form of holding the SGB?

The investors will be issued a Holding Certificate (Example of Holding Certificate- Form C), which is eligible for conversion into de-mat form.

03. What is the denomination, multiples, limits etc for the purchase of SGB?

The Bonds shall be denominated in units of one gram of gold or multiples thereof. Minimum investment in the Bonds shall be one gram with a maximum limit of subscription per fiscal year of 4 kg for individuals, 4 kg for Hindu Undivided Family (HUF) and 20 kg for trusts.

04. What is the Issue Price for the SGB?

The Issue Price for each tranche of SGB would be different. The nominal value of the Bonds shall be fixed in Indian Rupees fixed on the basis of simple average of closing price of gold of 999 purity (published by the India Bullion and Jewellers Association Limited for the last 3 working days of the week preceding the subscription period). The issue price of the Gold Bonds will be Rs 50 per gram less than the nominal value to those investors applying online and the payment against the application is made through digital mode.

05. What is the Interest for holding SGB?

The Bonds shall bear interest from the date of issue at the rate of 2.50 percent (fixed rate) per annum on the nominal value. Interest shall be paid in half-yearly rests and the last interest shall be payable along with principal on maturity.

06. What are the different modes to apply for SGB?

Scheduled Commercial Banks (excluding RRBs, Small Finance Banks and Payment Banks)designated Post Offices (as may be notified), Stock Holding Corporation of India Ltd (SHCIL) and recognized stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange Ltd. are authorised to receive applications for the Bonds either directly or through agents. Your brokerage may also be eligible to apply for SGB on your behalf.

07. When can the SGB be redeemed, and at what price?

i) The Bonds shall be repayable on the expiration of eight years from the date of issue of the Bonds. Pre-mature redemption of the Bond is permitted after fifth year of the date of issue of the Bonds and such repayments shall be made on the next interest payment date.
ii) The redemption price shall be fixed in Indian Rupees and the redemption price shall be based on simple average of closing price of gold of 999 purity of the previous 3 working days, published by the India Bullion and Jewellers Association Limited.

08. What are the tax implications for SGB?

– The Interest received on the Bonds shall be taxable as per the provisions of the Income-tax Act, 1961 (43 of 1961).
– The capital gains tax arising on redemption of SGB to an individual has been exempted.
– The indexation benefits will be provided to long term capital gains arising to any person on transfer of bond.

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2 thoughts on “Details of Sovereign Gold Bond Scheme (SGB)- 2020”

  1. How much percentage of an individual portfolio can be ideally be invested in Sovereign Gold bond scheme? Considering that the gold price may come down.

  2. Forgot to ask. Since these scheme is continuous and every year, can we say that is very low possibility of price manipulation when the bonds are about to mature?

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