SGB premature redemption 2026: price, dates and the new capital gains tax
RBI paid ₹14,614 a unit on SGB 2020-21 Series VII on 19 October 2026. Early exits are now taxed. See the next redemption dates and request windows.
If you hold Sovereign Gold Bonds (SGBs), you can cash them in with RBI after five years, on an interest date. This is called premature redemption. The price is good because gold has risen a lot since 2020. But the tax rule changed on 1 April 2026, and many investors still think an early exit is tax-free. It is not.
The October 2026 redemption price
RBI fixed ₹14,614 per unit (one unit is one gram of gold) for SGB 2020-21 Series VII. The redemption was paid on 19 October 2026, because 20 October was a holiday. The price is the simple average of the closing price of 999 purity gold published by the India Bullion and Jewellers Association on 14, 15 and 16 October 2026. This is under RBI press release 2026-2027/1344 of 16 October 2026.
This series was issued on 20 October 2020 at ₹5,051 a gram, or ₹5,001 for those who applied online. So each gram returned almost three times the money, before counting the 2.5% yearly interest.
Why an early exit is now taxed
Until March 2026, redemption of an SGB by an individual was not treated as a sale, so there was no capital gains tax, whether you waited for maturity or left after five years.
The Finance Act 2026 changed section 70(1)(x) of the Income-tax Act, 2025. The exemption now applies only when:
- you bought the bond at the original issue from RBI, not on the stock exchange or from someone else, and
- you hold it until maturity, which is eight years from the issue date.
This applies to all SGB series from 1 April 2026, for tax year 2026-27 onwards, under the Budget 2026 memorandum. So a premature redemption after five years is now taxable, even for an original subscriber.
How much tax you pay
The gain is the redemption price minus what you paid. An SGB held for more than 12 months is a long-term asset, so the gain is taxed at 12.5% without indexation, plus cess.
Example: on Series VII, an offline subscriber gains ₹14,614 minus ₹5,051, which is ₹9,563 a gram. At 12.5%, the tax is about ₹1,195 a gram before cess. On 10 grams, that is about ₹11,950.
No tax is deducted when RBI pays you, so you must pay it yourself through advance tax and show the gain in your return for tax year 2026-27. The 2.5% yearly interest was always taxable at your slab rate, and that has not changed.
If you keep the bond until maturity, the gain stays tax-free, provided you are the original subscriber. Series VII matures on 20 October 2028.
Next premature redemption dates
These are from RBI's calendar for October 2026 to March 2027, released on 21 August 2026. You must send your request inside the window, through your bank or post office, your depository participant (NSDL or CDSL), or RBI Retail Direct.
| SGB series | Redemption date | Request window | | --- | --- | --- | | 2019-20 Series VI | 30 October 2026 | 29 September to 21 October 2026 | | 2021-22 Series VII | 2 November 2026 | 1 October to 23 October 2026 | | 2020-21 Series VIII | 18 November 2026 | 17 October to 9 November 2026 | | 2020-21 Series II | 19 November 2026 | 19 October to 9 November 2026 | | 2021-22 Series I | 25 November 2026 | 23 October to 16 November 2026 | | 2021-22 Series II | 1 December 2026 | 31 October to 21 November 2026 | | 2021-22 Series VIII | 7 December 2026 | 6 November to 27 November 2026 |
RBI says the dates can change if there is an unscheduled holiday, and a depository participant may close its window a day earlier than RBI's date. RBI announces each redemption price just before the redemption date.
Before you decide
- Check which series you hold and whether you bought it at issue or on the exchange. Your demat statement or the original allotment advice shows this. Keep it with your tax papers.
- Compare the tax on an early exit with waiting for maturity, which is tax-free for original subscribers.
- If you bought on the exchange, the gain is taxable at maturity too, so the tax does not decide the timing for you.
Saifu is not a SEBI-registered investment adviser. This guide explains tax rules and RBI's dates. It is not advice to redeem, hold, buy or sell any bond.
Sources: RBI: Redemption price for premature redemption of SGB 2020-21 Series VII, 16 October 2026, RBI: SGB calendar for premature redemption, October 2026 to March 2027, Budget 2026 memorandum: Exemption for Sovereign Gold Bond, Upstox: SGB tax changes 2026, CDSL: early redemption calendar for October 2026 to March 2027.
Rules, rates and limits change. Check the official source linked above before you rely on a figure here. Posts never contain referral or affiliate links from the writer.
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