Gold has always been a symbol of success and wealth, an idea that is imprinted in our culture. It is frequently said to bring luck, particularly on joyous occasions. Many of us want to possess gold and keep it in our homes, whether it’s in the form of jewellery or coins. But just as essential as enjoying its beauty and worth is protecting it and complying with the laws governing the ownership of such valuable belongings.
How Much Gold Can You Legally Keep?
Any gold purchased with stated income, agricultural revenue, acceptable household savings, or legally inherited assets will not be subject to taxes, according to the Central Board of Direct Taxes (CBDT) standards. Furthermore, gold that falls below certain thresholds cannot be taken during house inspections:
- Married women: Up to 500 grams
- Unmarried women: Up to 250 grams
- Men (married or unmarried): Up to 100 grams
These restrictions highlight how crucial it is to understand the guidelines to prevent issues while preserving your gold.
Why Is Gold Still A Great Investment?
In addition to equities, mutual funds, and bonds, gold has long been a reliable investment choice. People are still drawn to it because it is a dependable method of increasing wealth. Many people still prefer real gold because of its tangible worth, even if new gold investment options like digital gold and Sovereign Gold Bonds (SGBs) are becoming more and more popular.
Various Gold Investment Types and Their Rules
There are several ways to invest in gold, and each has its own rules. Making wiser financial decisions is facilitated by being aware of these distinctions.
- Physical Gold: Married and unmarried women are allowed to own 500 and 250 grams of gold, respectively, whereas males are only allowed to hold 100 grams. While short-term sales are taxed at the income slab rates, actual gold sold after three years is subject to long-term capital gains tax of 20% + cess. Additionally, purchases are subject to a 3% GST.
- Digital Gold: This alternative is more handy because it doesn’t require any storage. The daily expenditure limit is Rs 2 lakh, and taxes are only due upon withdrawal.
- Sovereign Gold Bonds (SGBs): These bonds offer 2.5% yearly interest that is subject to taxes and enable investments of up to 4 kg annually. Profits from SGBs are tax-free after eight years.
- Gold ETFs and Mutual Funds: Gold mutual funds and exchange-traded funds (ETFs) are subject to the same taxation as real gold, with long-term capital gains taxed at a rate of 20% after three years.
Gold investing necessitates thorough preparation and familiarity with the many alternatives. Before making a choice, it is essential to conduct an extensive study because every type of gold investment has different advantages and rules.
