Have you invested money in gold? Know the tax rules on this

You must have heard the elders say that if you have gold in your house, you never have to cry. This is because gold is very useful in difficult times. It is not only for families but also for countries. Whenever geopolitical or economic crises start coming into the world, central banks start accumulating gold. Similarly, gold is a good investment option for people as well. Gold has given excellent returns for the last few years. At present, the domestic futures price of gold in the country is Rs 75,585 per 10 grams. Investment in gold is also taxed. Let us know about it in detail.

Tax on Physical Gold and Digital Gold

Both physical gold and digital gold are taxed in the same way. If it is sold after 3 years of purchase, then it is taxed at 20% + 8% cess along with long-term capital gains tax. However, if it is sold within 3 years of purchase, then the gains will be added to your income and tax will be levied as per the slab.

Tax on Sovereign Gold Bond

If you sell Sovereign Gold Bonds in the secondary market within 3 years of purchase, then they will be taxed according to your slab rate. But if you sell them after holding them for three years, then they are taxed at 20 percent long-term capital gain tax after indexation. However, if you hold them till maturity, then no tax is levied on them. The maturity period of these bonds is 8 years and after 5 years, there is also an option of early redemption. The 2.5 percent annual income received on these bonds is taxed according to the investor’s slab.

Gold Exchange Traded Funds

Income from Gold ETFs is taxed as per the investor’s tax slab.