Keep these things in mind before buying gold this festive-season!
Buying gold around Dhanteras and Diwali is auspicious as Indians share a special bond with it. It's one of the most preferred forms of jewelry and the best investment option. Unlike earlier days, people can shop for gold online from retailers and e-commerce platforms like Amazon, Paytm, and Flipkart. Before placing an order, take a look at this quick guide to buying gold online!
Choosing the right website to buy gold from
The first step to online gold shopping is to select a genuine website. Instead of looking for huge discounts/offers on bargain-hunting websites, it is important to shop on reputed websites. Buyers need to be sure of the website's authenticity. If buyers aren't sure about their purchase, they can also go for "try at home" option provided by some online stores like Caratlane and Bluestone.
Looking for purity while shopping for gold
Buyers should know the purity of their gold. The yellow metal is available in 14/18/22/24 carat, with 24K being the purest form. However, jewelry in 24K is not sold as it's malleable; so, silver, copper, nickel, etc. are added to make jewelry. But 24K gold coins/bars are available on e-commerce websites. Also, they should always look for the BIS Hallmark Certification on the ornament/bar/coin.
How much tax do you pay when you buy/sell gold?
It is essential to understand that gold is taxed while both buying and selling. When buying the precious metal, post-GST rollout, the customers are required to pay 3% tax on the value of the gold, including the making charges. While selling, the percentage of tax applicable depends on the duration the seller has held the gold, based on short-term and long-term capital gains.
Tax on the sale of gold
If a merchant sells gold within 3 years from the date of purchase, it would be taxable as STCG (Short-term Capital Gain), under the general income tax slab. In case the precious metal is sold 3 years after purchasing it, then it is taxable as LTCG (Long-term Capital Gain) at a rate of 20.6% after indexation of cost of acquisition.
Know the ornament's making charges and shipping costs
Gold ornaments come with making charges. It is important to calculate such costs by looking for the weights and prices of gold, stones, and other embellishments. Buyers need to make sure they aren't being charged the same for stones and gold weights. Gold coins have making charges too. Usually, gold is shipped for free, but it is better to check before placing an order.
Checking for the online store's return/exchange Policy
Customers need to check the online seller or website's return/exchange/buyback policy before making the purchase. Most online stores are offering returns and exchanges these days but under strict terms and conditions. Buyers need to carefully read these terms, conditions, or rules and know what price the seller is promising to repurchase the jewelry if you want to sell it after a few years.
Bills, certificates, and other important things
After purchase, buyers should receive bill/invoice, which helps in returns/exchanges and ensures they get the promised/claimed purity and weight. They may have to provide PAN card and other details. After receiving the product, customers need to check their package is intact and not tampered with. In case of doubt, don't accept it. If ornaments are damaged/broken, it's best to contact the customer care.