The bonds pay an additional interest of 2.5 per cent per annum on the nominal value of the gold.
Gold Ingot and coins. (Photo: iStock)
With few days left for Dhanteras and Diwali along with the plunge in gold prices, it is very likely that a majority of people would be thinking of buying the yellow metal. The uncertainty caused by the ongoing US-China trade war and volatility in the oil market has fueled demand for this safe-haven asset. But is it safe to buy physical gold? There is no harm in buying gold physically. But things like –safety, high cost, outdated designs and other few things that keep few investors at bay. Therefore, they opt for Sovereign Gold Bonds (SGB).
On Monday the government launched its ‘Sovereign Gold Bond Scheme 2019-20 – Series VI’ tranche with few additional benefits including tax benefits. The RBI has reserved the sovereign gold bonds price at Rs ₹3,835 per gram of gold. If applied and made payment online, you will get Rs 50 discount per gram. Some of the tax benefits are explained below.
The redemption price is fixed in Indian currency and is based on the simple average of closing price of gold of 999 purity of the previous three working days, published by the India Bullion and Jewelers Association Limited.
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(With input from agencies)
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