LIC Gold Investment Calculator
Compare cumulative wealth growth of physical gold bullion versus government Sovereign Gold Bonds (SGB) including interest payouts.
₹2,05,093
Yield CAGR of 9.95% (includes 2.5% p.a. interest).
• SGB interest of 2.5% p.a. is paid semi-annually on the initial nominal investment value.
• On maturity, capital gains from SGBs are 100% tax-free for individual investors, whereas physical gold gains incur long-term capital gains tax.
Sovereign Gold Bonds (SGB)
SGBs are government securities denominated in grams of gold. They offer a fixed interest rate of 2.50% p.a. paid semi-annually on the initial investment value, in addition to capital gains at redemption.
- Tax Savings: Capital gains tax at maturity (after 8 years) is completely exempt for individual investors.
- No Making Charges: Avoids making charges, storage costs, and purity risks associated with physical gold.
Physical Gold Costs
Physical gold incurs GST of 3%, storage locker fees, and making charges (ranging from 5% to 20%), which reduce the net compound returns over time.
Frequently Asked Questions (FAQ)
What is the lock-in period for Sovereign Gold Bonds?
SGBs have a tenure of 8 years. However, early exit options are available from the 5th year onwards on interest payment dates.
Is the SGB annual interest taxable?
Yes. The 2.5% p.a. interest paid on SGBs is fully taxable under 'Income from Other Sources' as per your income tax slab.
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