Investors holding Sovereign Gold Bond (SGB) 2018-19 Series-IV have good news.
The Reserve Bank of India (RBI) has announced the premature redemption price for this series, which is eligible for redemption on July 1, 2026.
According to the RBI, the redemption price has been fixed at ₹14,086 per unit, giving investors a return of around 359% over the original issue price.
In addition to the increase in gold prices, investors also earned 2.5% annual interest, paid every six months.
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Redemption Price Fixed at ₹14,086
The RBI determines the redemption price based on the average closing price of 999 purity gold over the last three business days before redemption.
For this tranche, the price has been calculated using the gold prices on June 25, June 29 and June 30, 2026, as published by the India Bullion and Jewellers Association (IBJA).
Investors who choose to redeem their bonds on July 1, 2026 will receive ₹14,086 per unit.
How Much Have Investors Gained?
The SGB 2018-19 Series-IV was open for subscription between December 24 and December 28, 2018, and the bonds were issued on January 1, 2019.
The issue price was ₹3,119 per gram, while online buyers received a ₹50 discount, allowing them to purchase the bonds at ₹3,069 per gram.
Based on the latest redemption price, investors have earned an overall return of about 359%.
The annualised return works out to around 35%, excluding the additional 2.5% annual interest that was paid during the holding period.
When Can SGBs Be Redeemed?
Sovereign Gold Bonds have a total maturity period of eight years.
However, investors are allowed to redeem them early after completing five years, provided the redemption is made on an interest payment date.
For SGB 2018-19 Series-IV, the next eligible premature redemption date is July 1, 2026.
New Tax Rules for SGB Investors
The Budget 2026 introduced new tax rules for Sovereign Gold Bonds.
If an investor purchased the bond during its primary issue and holds it until the full eight-year maturity, the capital gains will be completely exempt from tax.
However, this exemption does not apply to premature redemption through the RBI.
Capital gains will remain taxable if:
The bond was purchased from the secondary market.
The bond is sold in the secondary market.
The bond is redeemed during the premature redemption window, even if it was originally bought during the primary issue.
Important Note for Investors
While the latest redemption price offers substantial gains for eligible investors, the decision to redeem or continue holding should depend on individual financial goals and tax considerations.
Since tax rules may vary depending on individual circumstances and can change over time, investors should consider consulting a qualified tax professional or a SEBI-registered investment adviser before making any investment or redemption decision.