Investors holding Sovereign Gold Bonds (SGB) 2018-19 Series II will receive the final redemption amount of ₹14,425 per unit on October 23, 2026, marking the completion of the eight-year maturity period. This redemption price, fixed by the Reserve Bank of India (RBI), represents a significant increase from the original issue price of ₹3,146 per gram, delivering substantial returns to bondholders.
- The final redemption price is ₹14,425 per unit, as fixed by the RBI.
- The original issue price was ₹3,146 per gram, with a ₹50 discount for online digital payments.
- Returns exclude interest paid during the holding period.
- New capital gains tax rules effective from April 1, 2026, may affect gains.
- Tax exemption applies if bonds are held continuously until maturity.
What is the final redemption price for SGB 2018-19 Series II?
The RBI has announced that the final redemption price for the SGB 2018-19 Series II tranche is ₹14,425 per unit. This price was calculated based on the average closing price of 999-purity gold on October 19, 21, and 22, 2026, as published by the India Bullion and Jewellers Association Ltd. This price reflects the market value of gold at the time of maturity.
How much return have investors earned since the issue?
The bonds were issued in October 2018 at ₹3,146 per gram. Investors who subscribed online and paid digitally received a ₹50 per gram discount, paying ₹3,096 per gram. Comparing the final redemption price of ₹14,425 to the original issue price shows more than a fourfold increase in value. This capital appreciation excludes the interest earned during the eight-year holding period, which adds to the overall returns.
What are the new income tax rules affecting SGB gains?
From April 1, 2026, revised capital gains tax rules apply to Sovereign Gold Bonds. The exemption on capital gains tax at maturity is available only to individual investors who subscribed during the original issue and held the bonds continuously until maturity. Investors who meet these conditions may claim exemption on gains realized upon redemption.
When were these bonds issued and what is the maturity date?
The SGB 2018-19 Series II bonds were issued between October 15 and October 19, 2018, with settlement on October 23, 2018. The bonds have an eight-year tenure, making October 23, 2026, the final redemption date.
How does the purchase method affect the issue price?
Investors who subscribed online and paid through digital modes were eligible for a ₹50 per gram discount, reducing their purchase price to ₹3,096 per gram. Those who subscribed through other modes paid the regular issue price of ₹3,146 per gram.
In summary, the SGB 2018-19 Series II bonds have delivered strong returns to investors who held them until maturity. The RBI's fixed redemption price reflects gold's market value in October 2026. However, investors should be aware of the updated tax rules that may impact their net gains. Holding the bonds continuously from the original issue date until maturity is crucial for tax exemption benefits.
