Government launched 7.75% Savings (Taxable) Bonds, 2018 with effect from 10th January, 2018 - (04 Jan 2018)
Banking
Government has decided to launch of 7.75% Savings (Taxable) Bonds, 2018 commencing from 10th January 2018 to enable resident citizens/HUF to invest in a taxable bond, without any monetary ceiling. 8% Savings Bonds Scheme, also known as RBI Bonds Scheme, are replaced by 7.75% Savings Bonds Scheme. Individuals (including Joint Holdings) and Hindu Undivided Families can invest in the bonds. NRIs are not entitled to make investments in these Bonds. Applications for the Bonds in the form of Bond Ledger Account will be received in the designated branches of agency banks and SHCIL. The Bonds will be issued at par i.e. at Rs.100.00.
The Bonds will be issued for a minimum amount of Rs.1,000/- (face value) and in multiples thereof. Accordingly, the issue price, will be Rs.1,000/- for every Rs.1,000/- (Nominal). The Bonds will be issued in demat form (Bond Ledger Account) only. The Bonds will be on tap till further notice and issued in cumulative and non-cumulative forms. There will be no maximum limit for investment in the Bonds. Interest on the Bonds will be taxable under the Income-tax Act, 1961 as 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. The Bonds shall be repayable on the expiration of 7 years. The Bonds are not transferable. The Bonds are not tradeable in the Secondary market and are not eligible as collateral for loans from banking institutions, non-banking financial companies or financial institutions. A sole holder or a sole surviving holder of a Bond, being an individual, can make a nomination.
Tax will be deducted at source while making payment of interest on the Non-Cumulative Bonds from time to time and credited to Government Account. Tax on the interest portion of the maturity value will be deducted at source at the time of payment of the maturity proceeds on the Cumulative Bonds and credited to Government Account. Tax will not be deducted while making payment of interest/ maturity proceeds, as the case may be, to individual/s who have made a declaration in the application form that they have obtained exemption from tax under the relevant provisions of the Income Tax Act, 1961.
Tags : SAVING BONDS SCHEME LAUNCH
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