Tax on Inherited Gold: Grandmother’s necklace, mother’s bangles or father’s ring… these ornaments are not just jewelry, but heritage passed down from generations. Be it a wedding or a special occasion, it is common for parents and grandparents to gift gold to their children
Tax on Inherited Gold: Grandmother’s necklace, mother’s bangles or father’s ring… these ornaments are not just jewelry, but are heritage passed down from generations. Be it a wedding or a special occasion, it is common for parents and grandparents to gift gold to children. But when it comes to selling this inherited gold, the first question that comes to mind is, will it be taxed?
Thinking of making a profit by selling the inherited gold kept at home? Now know that the income tax rules have a direct impact on it. When it comes to selling inherited gold, the biggest question that arises is whether tax will have to be paid on it?
Is inherited gold taxable?
Yes. According to the Income Tax Act, inherited gold is considered a capital asset. This means that if you sell it, you will have to pay capital gains tax on the profit you get. The special thing is that for tax, the date of purchase of gold and its cost will be considered the same as when and for which your parents or grandparents bought the gold. For example, if your grandmother bought gold in 1981 and you inherited it at the time of marriage, then the date of purchase will be considered 1981 for tax calculation.
Bought gold before 2001?
If gold was purchased before 1 April 2001, then you have a special option. If you want, you can consider the fair market value (FMV) of 2001 as the purchase price. This is beneficial when there are no old bills or records.
Now the question is how will the tax be levied?
Earlier the rule was that if gold is kept for more than 36 months, then it will be considered a long-term asset. But after the Finance Act 2024, this period has been reduced to 24 months. If you have kept gold for more than 24 months, then it will be considered as long-term gain and you will have to pay 12.5% tax (without indexation). If you sell the gold before 24 months, then it will be considered as short-term gain and tax will be levied according to your income tax slab.
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