How much gold can Indians own? Know the law
What's the story
With Dhanteras and Diwali approaching, many families are considering their gold purchases. The Gold Control Act of 1968 once restricted gold ownership in India, but the law was repealed in 1990. Now, there's no legal limit on how much gold a person can own as long as they can prove its legitimate source through invoices or inheritance documents.
Limits
Limits on seizing gold jewelry during raids
The Central Board of Direct Taxes (CBDT) has issued guidelines for income tax officials during raids. According to a circular dated May 11, 1994, jewelry up to certain limits cannot be seized. These limits are 500g for married women, 250g for unmarried women, and 100g per male member of the family irrespective of their marital status.
Tax implications
Tax on gold
The tax on gold depends on its form and holding period. Physical gold, Gold ETFs, and other digital gold products are considered capital assets. If sold within 12 months, short-term capital gains (STCG) apply and are taxed according to the individual's income slab (5% to 30%). However, if held for more than 12 months, long-term capital gains (LTCG) apply at a rate of 20% without indexation under the current regime.