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There is no set gold storage limit in India. This makes gold a great option for investments. However, past a certain limit, the owner must submit inheritance and investment proofs. Here are the gold storage rules that you should know about.

Gold Storage Rules

As per a press release issued on December 1, 2016, The Central Board of Direct Taxes (CBDT) declared that there is no set limit on the gold you can own in India. You need not submit any ownership proof if the gold you own falls within a certain weight limit. This is as follows: 

  • Married woman: Up to 500 g 

  • Unmarried woman: Up to 250 g 

  • Man: Up to 100 g

If your gold holdings cross the mentioned limits, you must report it and submit proof of ownership like the bills of receipt and tax invoices. This helps you avoid the inspection and seizure of gold by the Income Tax Department of India.

Tax Regulations for Owning Gold

In case you have more gold than the limits mentioned above and you do not declare it to the government, it can be seized. In such cases, you are given a chance to explain the source of income for making such investments. If you fail to explain or if the given explanation is non-satisfactory, then it shall be taxable. This is as per Section 69B of the Income Tax Act of 1961.
 

Assume that you spent more money on buying gold than your recorded income sources justify. The Assessment Officer may consider this excess as additional income. As per the section, this excess amount is then taxed at the rate mentioned in Section 115BBE:

  • Tax on additional income under section 115BBE is 60% 

  • A surcharge of about 25% of the taxed amount is also applicable

  • A penalty of 10% will be levied on the above tax amount u/s 271AAC. This depends on whether the income is shown in your tax return files u/s 139. 
     

Since there is no gold limit in India, you can store as much gold as you want if you have valid proof. When you buy gold, ensure to collect the tax invoice. If it is your inherited asset, having a family settlement deed, will etc., will be helpful.

Frequently Asked Questions

Is there a limit on owning gold in India?

No. There is no limit to owning gold in India if you have valid documents to prove the ownership.

What should I keep an eye out for when buying gold?

While buying gold, ensure that it has the BIS Hallmark that certifies its purity. Also check the cost per gram, exact weight, purity level, and other charges.

How much gold can I buy without reporting?

The limit for a woman who has married is 500 g, for an unmarried woman, 250 g, and for a man, 100 gm. If you own gold beyond these limits, you will have to report it to the government with appropriate proof.

What are the investment limits for SGBs and Gold ETFs?

Individuals and  HUFs and deposit amounts equivalent to 4 kgs of gold when investing in SGBS. This limit goes up to 20 kgs of gold in the case of trusts. Meanwhile, ETFs do not have an upper capping.

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