HIGHLIGHTS:
- Due to the Russo-Ukraine war, the price of gold is seeing a rise
- Invest in gold from February 28 to March 4
- Government has fixed the price of Sovereign Gold Bond at Rs 5,109 per gram or per bond
The price of gold is rising as a result of the Russo-Ukraine conflict. Experts predict that the current trend will continue in the future. In this case, if you want to invest in gold right now, you can do so by purchasing a Sovereign Gold Bond. The government is offering you the opportunity to invest in Sovereign Gold Bonds once more. From February 28 to March 4, investors can invest in gold through the
Sovereign Gold Bond Scheme 2021-22.
The government has set the price of a Sovereign Gold Bond at Rs 5,109 per gram or each bond this time around. You will receive a Rs 50 per gram discount if you apply online and make a digital payment. That means, 1 gram of gold costs Rs 5,059 in India.
The Reserve Bank of India issues sovereign gold bonds
A sovereign gold bond is a government bond issued by the Reserve Bank of India. It is possible to convert it to demat form. Its worth is measured in gold weight. If the bond is worth five gram of gold, then the bond’s value is equal to the price of five gram of gold. For purchase, the issue price must be paid to a SEBI-certified broker. The money from the bond sale is placed into the investor’s account.
On the issue price, 2.50 percent interest is provided.
On the issue price, Sovereign Gold Bonds pay a set interest rate of 2.50 percent per year. This money is deposited into your account every six months. However, you’ll have to pay tax on it based on the slab.
There’s no need to be concerned about purity and safety
In Sovereign Gold Bonds, there is no need to be concerned about purity. The price of gold bonds is tied to the price of 24 karat pure gold announced by the Indian Bullion and Jewelers Association, according to the National Stock Exchange (NSE) (IBJA). It can also be preserved in the form of demat, which is quite safe and comes at no cost.
How much tax has to be paid on this?
There is no tax on the gains made after the maturity period of 8 years. On the other hand, if you withdraw your money after 5 years, then the profit from it is taxed as Long Term Capital Gain (LTCG) at 20.80%.
You can also invest in the offline market
The RBI has provided a variety of investing possibilities. Bank branches, post offices, stock exchanges, and the Stock Holding Corporation of India (SHCIL) are all places where you can invest. An application form must be completed by the investor. The money will be withdrawn from your account after that, and the bonds will be transferred to your demat account.
For investing, having PAN is required. All banks, the Stock Holding Corporation of India Limited (SHCIL), and recognized stock exchanges, such as the National Stock Exchange of India Limited (NSE) and the Bombay Stock Exchange Limited (BSE) , would sell the bonds .
Anuj Gupta, Vice President (Commodity & Currency), IIFL Securities said that the Russo-Ukraine war has given rise to gold. Apart from this, inflation is not being controlled. Due to this, gold can reach the level of $ 2100 in the next 2-3 months in the international market. With this, gold can go up to 56 thousand in our place.
