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GST on Gold - Here's All You Need to Know

November 05, 2018 5950
The Goods and Services Tax came in effect from 1st July, 2017. It has brought a lot of changes, with the price of some goods reducing while certain items like alcohol staying untouched by GST. People thought that the prices of real estate properties would reduce but that is yet to happen. While some goods and services remained un-impacted, our favorite metal Gold did get impacted by GST. Let's understand more about GST on Gold.
  1. Rates- Under GST, there is a 3 percent charge on gold. If there's additional work on the gold then it goes to 5 percent. If you are exchanging old gold with new, the GST rate would be adjusted towards your purchase.
  2. Tax on making of jewelry- If you are making changes to old jewelry or simply getting a new one made, the GST rate for that is 5 percent, and this also includes polishing.
  3. Resale- If you are selling old gold, it will not have any tax on it if you use that money to buy new gold jewelry. This means, you need to buy new gold in exchange of old to avoid taxes. Before GST, there was a 3 percent charge on selling old gold even if you were buying new gold along with it.
  4. Exemption- Avoiding taxes is not as easy, in case of buying gold, as it seems. If you are buying gold from an unregistered supplier, you will be paying taxes on the same under reverse charge mechanism. Provisions for the same have been put in place to ensure illegal trading gold can be prevented.

This is all you need to understand about the impact of GST on Gold. Gold is one of the most solid investments of all time. It has a high liquidity, is a sign of wealth and one of the best gifts that can be given to a loved one. The above points can help you make an informed purchase of gold now since you understand the impact of GST on it. For any details on where and how to invest, visit https://www.hdfclife.com/.

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