Unlock Tax-Free returns: Invest in Sovereign Gold Bonds as last tranche opens on February 12

The final tranche of Sovereign Gold Bonds (SGBs) for this financial year is set to open on February 12, closing on the 16th. Priced at Rs 6,262 per gram, these bonds have consistently outperformed physical gold and gold exchange-traded funds (ETFs), making them an attractive option for individuals seeking tax-free returns.

Investors in SGBs enjoy a fixed interest rate of 2.5% per annum, distributed semi-annually based on their investment’s nominal value. With an effective interest rate of 1.25% per payment, the yield, coupled with the metal’s appreciation value, offers a compelling 9%-12% compound annual growth rate throughout the maturity period.


Retaining SGBs until maturity (eight years) qualifies investors for exemption from capital gains tax on the final redemption amount. While premature redemption is an option after the fifth year, gains at the time of redemption are subject to taxation.

Issued by the RBI in multiple tranches throughout the year, SGBs are available for purchase in the secondary market. Resident Indians can buy SGBs from nationalized banks, post offices, foreign banks, NSE, and BSE. Non-resident Indians (NRI) are ineligible to purchase SGBs initially, but if a resident becomes an NRI after purchase, they can hold the SGB until maturity. The minimum investment is one gram, with a maximum limit of four kilograms for individuals and 20 kg for trusts in a financial year.