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Investing

SGB Premature Redemption: How to Exit a Sovereign Gold Bond Early

Redeem an SGB early after five years on an interest date through your bank, post office or broker, or sell it on the exchange any time.

RM

Written by Rohan Mehta

Published 28 September 2026·6 min read

On this page9 sections
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You can redeem a Sovereign Gold Bond early after five years from issue, on an interest payment date. Apply through your bank, post office, SHCIL office or depository participant within RBI’s request window. A demat SGB can also be sold on NSE or BSE at any time. From 1 April 2026, early redemption gains are taxable.

Key facts

Item Rule
Tenor 8 years
Early redemption After the 5th year from issue, on an interest payment date
Interest 2.50% a year on the initial investment, paid every six months
Redemption price Simple average of IBJA closing price of 999 gold for the 3 business days before redemption
Recent price ₹15,355 per unit for redemption on 9 September 2026
Part redemption Allowed in multiples of 1 gram
Tax on early redemption Taxable from 1 April 2026, even for original subscribers
New issues None since 2023-24 Series IV, issued 21 February 2024

Eligibility: the five-year rule and interest dates

Each tranche pays interest twice a year on fixed dates tied to its issue date. Early redemption is allowed only on those dates, starting with the first one after five years. If you miss one date, the next chance comes six months later.

Example: 2019-20 Series V was issued on 15 October 2019. Its first early redemption date was 15 October 2025, and the next is 15 October 2026. You can redeem part of your holding in multiples of one gram and keep the rest.

Where RBI announces windows and the price

RBI publishes a half-yearly calendar under the Consolidated Procedural Guidelines on the SGB Scheme. The calendar for October 2026 to March 2027, released on 21 August 2026, lists 32 tranches. Some near-term dates:

Tranche Redemption date Request window
2019-20 Series V 15 October 2026 14 September to 5 October 2026
2020-21 Series VII 19 October 2026 19 September to 9 October 2026
2020-21 Series I 28 October 2026 26 September to 19 October 2026
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

RBI says dates can shift if there is an unscheduled holiday. The price is announced a day or so before each redemption date in an RBI press release. It is the simple average of the India Bullion and Jewellers Association closing price for 999 gold over the previous three business days. For the 9 September 2026 redemption, the price was ₹15,355 per unit. Our gold rate today page shows current prices.

Applying through your bank, post office, SHCIL or broker

Where you apply depends on how you hold the bond.

  1. Find your tranche name and issue date on the Certificate of Holding or your demat statement.
  2. Check the RBI calendar for your redemption date and request window.
  3. If the bond is in RBI’s books (certificate form), give a redemption request to the bank branch, post office or SHCIL office that issued it.
  4. If the bond is in demat form, submit a Repurchase/Redemption Request Form (RRF) to your depository participant. Brokers act as participants for most investors.
  5. If you bought through RBI Retail Direct, place the request on that portal.
  6. Enter the quantity in grams, not an amount.
  7. Confirm that the bank account on record is correct, because proceeds go only to that account.

Submit the request before the window closes. RBI’s FAQ says a request is accepted only if it reaches the office at least one day before the interest date, but the published window usually closes earlier.

Selling on NSE or BSE instead

SGBs held in demat form can be traded on the stock exchanges, so you do not have to wait for a redemption date. You place a sell order through your broker like any listed security. The price is set by buyers and sellers, so it can be higher or lower than the RBI redemption price, and some tranches trade thinly. Bonds held in certificate form must first be converted to demat before you can sell them.

Exchange sales have two other effects. The buyer does not get the tax exemption at maturity. Your own gain is taxed under the rules below.

What happens at final maturity

At the end of eight years the bond is redeemed automatically. The issuing office tells you about a month before maturity. The proceeds and the last interest payment go to your bank account on record. RBI announces the final redemption price in the same way as the early redemption price. If your bank details have changed, update them with the bank, SHCIL office or post office before the date.

Tax on early redemption vs maturity

The Finance Act, 2026 rewrote Section 70(1)(x) of the Income-tax Act, 2025 from 1 April 2026. The exemption now applies only if an individual subscribed at the original issue and held the bond until maturity. The Income Tax Department’s Budget FAQs, as reproduced by TaxGuru, state that premature redemption does not qualify, even after the lock-in.

How you exit Bought at issue Bought on exchange
Held to maturity Exempt Taxable
Early redemption with RBI Taxable Taxable
Sold on exchange Taxable Taxable

SGBs are listed securities, so a gain on a bond held for more than 12 months is long-term. Section 197 of the 2025 Act taxes it at 12.5% without indexation. Any early redemption comes after at least five years, so it is always long-term. A short-term gain from an exchange sale is added to your income and taxed at slab rates. The 2.50% interest is taxable every year at slab rates, and no TDS is deducted on it.

Use the capital gains calculator to estimate the tax before you decide. If you hold bonds from several tranches or bought some on the exchange, a chartered accountant can check the tax on each lot.

The Sovereign Gold Bonds guide explains how the scheme works.

Frequently asked questions

When can I redeem my SGB before maturity?

After five years from the issue date, on an interest payment date. RBI publishes the dates and request windows every six months.

How is the SGB premature redemption price calculated?

It is the simple average of IBJA’s closing price for 999 gold on the three business days before the redemption date.

Is SGB premature redemption tax-free?

Not from 1 April 2026. Only original subscribers who hold the bond until maturity get the exemption.

Can I redeem only part of my SGB holding?

Yes. RBI allows partial redemption in multiples of one gram.

What if I miss the request window?

You wait for the next interest date, six months later, or sell the bond on the exchange if it is in demat form.

Are new Sovereign Gold Bonds being issued?

No tranche has been issued since 2023-24 Series IV in February 2024. You can still buy existing bonds on the exchange, but the maturity exemption will not apply to you.

Sources

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