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Can you please clarify whether long-term capital gain tax would be payable at the time of maturity on sovereign gold bonds (SGBs) purchased from the secondary market? Since the initial bonds issued eight years ago already matured, I am sure the I-T department would have processed the ITRs or issued some guidelines on such LTCG tax aspect by now.
Ramesh
Typically, if you are holding the SGBs purchased from the secondary market till maturity, then in terms of section 47(viic) of the Act, there will not be any tax implications. However, if you sell the bonds in the secondary market instead of holding till maturity, then the transaction would be considered a transfer and there will be capital gains tax. It is important to note that this exemption referred above is applicable only for SGB issued by the Reserve Bank of India under the Sovereign Gold Bond Scheme 2015.
The writer is Partner, Deloitte India
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