SGB Redemption Value

This page explains how Sovereign Gold Bond (SGB) redemption value is calculated at maturity or during premature redemption, as per RBI guidelines.

To calculate exact redemption value instantly, use the SGB Calculator.

What is SGB Redemption Value?

The redemption value of an SGB is the amount paid to the investor when the bond is redeemed. It depends on the prevailing gold price and the number of units held.

How SGB Redemption Value is Calculated

The redemption price is calculated based on the average closing price of 999 purity gold for the previous three business days, as published by IBJA.

Redemption Value = Gold Price × Number of Units

SGB Redemption Example

If you hold 10 grams of SGB and the average gold price at redemption is ₹7,000 per gram:

Redemption value = 10 × ₹7,000 = ₹70,000
Interest earned is paid separately

Premature Redemption of SGB

Although SGBs have an 8-year maturity, premature redemption is allowed from the 5th year onwards on interest payment dates.

Tax on SGB Redemption Value

Capital gains on redemption of Sovereign Gold Bonds at maturity are exempt from tax for individual investors. Premature redemption may attract capital gains tax as per applicable rules.

Frequently Asked Questions

Is SGB redemption value guaranteed?: The gold price is market-linked, but the redemption mechanism is governed by RBI rules.
How is SGB redemption price decided?: It is based on the average gold price of the last three business days before redemption.
Can I redeem SGB before 8 years?: Yes, premature redemption is allowed from the 5th year onwards.