Quick Summary
The Central Board of Direct Taxes (CBDT) has issued a clear clarification regarding how much gold jewellery individuals can own without the risk of seizure during income tax raids. The update is particularly relevant for households in Pune, where gold remains both a traditional asset and a financial investment. Gold Jewellery Limits Set by CBDT The CBDT's long-standing circular outlines specific limits for gold ownership that cannot be confiscated, even if you don't have purchase receipts:
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FAQ :
Married women can hold up to 500 grams, unmarried women up to 250 grams, and men (any marital status) up to 100 grams of gold jewellery without requiring purchase receipts for protection against seizure.
Owning more than the prescribed limits is not illegal, but you must be able to provide documentation such as purchase invoices, inheritance documents, or gift deeds to justify the source of the excess jewellery.
Yes, if the source of the excess jewellery cannot be justified or doesn't align with your declared income or family background, tax officers may decide to seize the quantity exceeding the limits.
These rules were introduced based on a 1994 CBDT circular to prevent the arbitrary confiscation of genuine household ornaments during raids, acknowledging the cultural and emotional significance of gold in India.
There is no tax on simply holding gold. However, selling gold can trigger capital gains tax: short-term capital gains (within 2 years) are taxed as per your income slab, and long-term capital gains (over 2 years) are taxed at a flat 12.5%.
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