Govt launched 7.75% Savings Bonds Scheme: Here’s all you need to know about it

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Govt launched 7.75% Savings Bonds Scheme: Here’s all you need to know about it

The Central government has announced the launch of 7.75 percent Savings Bonds which will enable citizens and Hindu Undivided Families (HUFs) to invest in a taxable bond without any monetary ceiling.

From January 10, 2018, the bonds will be open to investment by individuals, including joint holdings and HUFs. NRIs can’t invest in these new savings bonds, which would replace the 8 percent scheme that is also known as the RBI Bonds Scheme.

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Know more about the Savings Bonds Scheme:

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Investment limits: The bonds will be issued at par at Rs 100. There is no maximum limit for investment in the bonds and they are non-transferrable.

Issue of bonds: The bonds will be issued for a minimum amount of Rs 1,000 (face value) and in multiples thereof, and the issue price will be Rs 1,000 for every Rs 1,000 (nominal). Also the bonds will be issued in demat form (bond ledger account) only.

Maturity period: The savings bonds will reach maturity in seven years and carry an interest at 7.75 percent per annum. This interest will be payable half-yearly. The cumulative value of Rs 1,000 at the end of seven years will be Rs. 1,703.

Tax benefits: Interest on the bonds will be taxable under the Income Tax Act, 1961. It is applicable according to the relevant tax status of the bond holder. The bonds will be exempt from wealth tax under the Wealth Tax Act, 1957.

 source by:-msn
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