Income tax calculator: Gold, silver or any other precious metal jewelry bought by an Indian is considered investment by the income tax department of India. As per the income tax act, if a person sells one’s jewelry then short-term capital gain or long-term capital gain becomes applicable (depending upon the time of acquisition). In the case of gift or inheritance, if the jewelry holder is unable to produce the original bill, then he or she has the option to claim cost of acquisition as on its price on 1st April 2001 by consulting a government recognised jewelry valuer.
Speaking on the income tax rule applicable on one’s capital gain after jewelry sale Pankaj Mathpal, Founder & CEO at Optima Money Managers said, “If the period of acquisition is not more than 36 month, then short-term capital gain will be applied on the jewelry sale. However, in the case of jewelry acquisition being more than 36 months long term capital gain will be applied.”
Pankaj Mathpal of Optima Managers said that in the case of long term capital gain on jewelry sale, one will be able to get indexation benefit and the payable tax will be 20.8 per cent (20 per cent income tax plus 4 per cent cess payable on the net income). However, in the case of short term capital gain, one’s net income from the jewelry sale will get added in one’s regular income and the income tax will become payable as per the income tax slab in which the individual falls.
On how the acquisition cost will be decided if the jewelry sold was gifted or inherited and the owner is unable to produce its original bill Balwant Jain, a Mumbai-based tax and investment expert said, “In case of gift or inheritance of the jewelry, the owner can claim its acquisition cost as per its price on 1st April 2001. One can get its valuation done by consulting a government recognised jewelry valuer.”
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