In India, the rules regarding gold ownership and income tax are structured to manage the possession of gold while ensuring compliance with tax regulations.
Here’s a summary of how much gold you can keep at home and the associated income tax rules:
Gold Ownership Limits: Married women can hold up to 500 grams, unmarried women up to 250 grams, and men up to 100 grams of gold without facing scrutiny from tax authorities.
Documentation Requirement: If your gold holdings exceed these limits, you must provide proof of purchase or legal acquisition to avoid potential legal issues or tax evasion claims.
Tax on Sale of Gold: Selling gold incurs capital gains tax; short-term capital gains (if held for less than 24 months) are taxed at the individual's income tax slab rate, while long-term capital gains (held for over 24 months) are taxed at 12.5%.
GST on Gold Purchases: A Goods and Services Tax (GST) of 3% applies to the purchase of gold bars and coins, while making charges for jewellery attract a GST of 5%.
Income Tax Returns (ITR): Taxpayers with an annual income exceeding ₹50 lakh must disclose their gold holdings as part of their assets in their ITR.