Buying gold on Dhanteras is considered very auspicious. If you have also bought gold on Dhanteras this year, then now know how much tax you will have to pay on it as per the new rate. The government has changed the rules of tax on gold in the country this year.
This year, when Finance Minister Nirmala Sitharaman presented the full budget for 2024-25 in July, she changed the rules related to capital gains tax. This had an impact on the tax on investment in mutual funds, real estate, equity and gold.
Now according to the new rules, those who do not take advantage of indexation in income tax will have to pay less tax, while those who take advantage of indexation will have to pay tax at the earlier rate.
How much tax will be levied on gold jewellery?
If you understand the calculations of tax related to gold, then you have to pay tax on everything from gold jewelery to digital gold and gold ETFs. For example, when you buy new gold jewellery, you have to pay 3 percent GST on it. This is calculated on the price of gold and the making charges of the jewellery.
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Whereas if you sell old gold jewelery and buy new jewelery in exchange, then it will be considered as sale of old gold. On this you will have to pay tax as per capital gains tax. According to the new income tax rules, if you have sold old gold after 2 years, then you will have to pay long term capital gains tax. Whereas if you are reselling it in a period of less than two years, then you will have to pay short term capital gains tax.
According to the new income tax rules, if you do not avail the benefit of indexation, then you will have to pay long term capital gains tax of 12.5 percent on selling old gold. Whereas short term capital gains tax is levied as per your tax slab.
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Tax on digital gold, gold ETFs
If you invest in digital gold or gold ETF, you have to pay tax on this also. Be it digital gold or gold ETF or gold mutual fund, you have to pay tax. This is treated as short term and long term capital gain just like physical gold.
If you have invested in gold mutual funds or gold ETFs after April 1, 2025, in that case you will have to follow the new capital gains tax rules. Before that, you will continue to get the benefit of old capital gains tax rules on investments.
